Estimated turnover cannot rest on missing purchase bills alone where declared sales are supported and unchallenged.

An estimated sales tax turnover cannot be sustained merely because purchase bills are not fully produced or sales have declined from the previous year, where the declared sales are supported by books and no enquiry discredits the buyer or the sales figures. Here, the assessee had disclosed sales to a single established buyer, the recorded turnover was backed by the books, and no adverse material was found to doubt the declared sales. On that basis, the high turnover estimate of Rs. 11 lakhs was held unjustified, set aside, and the original assessment order was restored.

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Issues: Whether the estimate of taxable turnover at Rs. 11 lakhs in sales tax assessment was justified on the basis of non-production of purchase bills and a decline in sales.

Analysis: The assessee had disclosed its sales to a single established buyer and the recorded turnover was supported by the books. The enhancement made by the assessing authorities rested mainly on the absence of purchase bills and on a comparison with the previous year's turnover. No enquiry was made with the buyer, and no other material was found to cast doubt on the correctness of the declared sales. The mere fact that purchases were not fully verifiable, or that sales had declined from the preceding year, did not by itself justify a very high estimated turnover where the sales themselves were not shown to be suspect.

Conclusion: The estimate of turnover at Rs. 11 lakhs was unjustified and was set aside. The revisionist succeeded and the assessment order of the Assistant Commissioner (Judicial) Sales Tax was restored.

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