Proper documentation for detained goods and evidence of tax evasion justified penalty where records were missing and contradictory.

Proper documentation accompanying detained goods was treated as essential to rebut the presumption arising from detention. On the facts, non-production of the bill or invoice, delivery challan, goods receipt and account books, together with an undated declaration and a later contradictory letter, supported the conclusion that the transaction was not backed by genuine records. The court held that these circumstances reasonably established an attempt to evade tax, and the penalty based on that finding was upheld.

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Issues: Whether the goods were accompanied by proper and genuine documents and whether the circumstances established an attempt to evade tax so as to justify the penalty.

Analysis: The available documents were found insufficient to rebut the presumption arising from the detention of goods. The record showed non-production of the bill or invoice, delivery challan, goods receipt, and account books, while the declaration produced was undated and the later letter was treated as contradictory. On these facts, the finding that the transaction was not supported by proper documentation and that an attempt to evade tax had been made was held to be a reasonable conclusion based on the evidence.

Conclusion: The finding of attempted tax evasion and the resulting penalty were upheld.

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