Rejection of Books of Account Sustained Where Returns, Survey Material and Undisclosed Sales Showed Suppressed Turnover

Rejection of books of account and estimation of taxable turnover were sustained where the dealer's returns did not match the account books, the survey material and show-cause notice supported the assessment, and the dealer failed to appear or explain the seized bilities. The fall in turnover was not the sole basis for rejection, and the explanation for that decline did not cure the other discrepancies. An undisclosed inter-State sale was also admitted, no revised Central return was filed, and these facts justified the conclusion that the accounts were not properly maintained and turnover had been suppressed. Revisional interference was therefore unwarranted.

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Issues: Whether the rejection of the books of account and the consequent estimation of taxable turnover under the State and Central tax laws were justified.

Analysis: The dealer's returns did not tally with the account books, and the assessing authority relied on the survey report, the show-cause notice, and the dealer's failure to appear or explain the seized bilities before the Sales Tax Officer. The decline in turnover was not the sole basis for rejection, and the explanation offered for that fall did not cure the other discrepancies. The dealer also admitted an inter-State sale not disclosed in the Central return and did not file any revised return. On these facts, the authorities had material to conclude that the accounts were not properly maintained and that turnover had been suppressed.

Conclusion: The rejection of the books of account and the estimation of turnover were upheld, and no interference was called for in revisional jurisdiction.

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