Penalty limited to actual suppressed turnover, not estimated additions, under sales tax law.

Penalty under section 12(3)(b) of the Tamil Nadu General Sales Tax Act, 1959 applies only to actual suppressed turnover and not to turnover added by estimation. The Tribunal applied the statutory Explanation, which excludes estimated additions from penalty computation, and sustained the tax addition while limiting penalty to turnover actually found suppressed. The High Court found no reason to interfere with that approach, leaving the penalty confined to the suppressed turnover alone.

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Issues: Whether penalty under section 12(3)(b) of the Tamil Nadu General Sales Tax Act, 1959 could be levied on turnover estimated by the assessing authority by way of equal addition, or whether it was confined to the actual suppressed turnover alone.

Analysis: The Tribunal applied the Explanation to section 12(3)(b), which excludes from penalty turnover representing estimated additions and confines penalty to actual suppression. It sustained the tax addition made on estimation, but for penalty purposes held that only the turnover actually found suppressed could be taken into account. The High Court found no reason to interfere with that approach.

Conclusion: Penalty under section 12(3)(b) was held to be leviable only on the actual suppressed turnover and not on the estimated turnover added by the assessing authority.

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