Guesswork assessment and penalty for non-disclosure fail where statutory enquiry and willful suppression are not proved.

Assessment made on a guesswork basis, without the factual enquiry required by the statutory rule and without investigation into the prevailing market rate, was treated as unsustainable. Penalty under section 16(2) of the Tamil Nadu General Sales Tax Act, 1959 was linked to willful non-disclosure and, in the absence of such a basis, could not stand. Because the matter turned on concurrent factual findings rather than a substantial question of law, the revision did not succeed and the relief granted below was left undisturbed.

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Issues: (i) Whether the assessment made by the Assessing Officer on a guesswork basis, without the factual investigation required under the statutory rule, could be sustained; (ii) whether penalty under section 16(2) of the Tamil Nadu General Sales Tax Act, 1959 was attracted in the absence of willful non-disclosure.

Issue (i): Whether the assessment made by the Assessing Officer on a guesswork basis, without the factual investigation required under the statutory rule, could be sustained.

Analysis: The assessment was found to rest on guesswork, including an addition made without taking into account the relevant factors prescribed under the rule and without necessary investigation into the prevailing market rate. The first appellate authority and the Tribunal both recorded factual findings that the disputed turnover had been assessed without the mandatory enquiry contemplated by the statute.

Conclusion: The assessment on guesswork basis could not be sustained.

Issue (ii): Whether penalty under section 16(2) of the Tamil Nadu General Sales Tax Act, 1959 was attracted in the absence of willful non-disclosure.

Analysis: The penalty provision was treated as applicable only where there is willful non-disclosure. Since the assessment itself was set aside as unsustainable on facts, the consequential penalty also lacked foundation. No substantial question of law arose from the concurrent factual findings.

Conclusion: The penalty was not attracted and the deletion of penalty was upheld.

Final Conclusion: The revision failed because the dispute turned entirely on concurrent factual findings and did not raise any substantial question of law, resulting in dismissal of the revision and affirmation of the relief granted below.

Ratio Decidendi: Concurrent factual findings that an assessment was made on guesswork without the statutory enquiry required by the rule, and that penalty under section 16(2) depends on willful non-disclosure, do not give rise to a substantial question of law in revision.

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