Purchase bills missing at inspection did not alone prove suppression where later accounting and tax payment were shown.

Non-production of purchase bills at inspection did not, by itself, establish suppressed turnover where the purchases were later entered in the books and tax was paid. The record showed that the stock had been reflected in the purchase register and the defect was subsequently rectified, so mere absence of bills on the inspection date was insufficient to justify restoring the original assessment. The appellate authority was found to have erred in interfering with the relief granted on that basis, and the order of the appellate tribunal was set aside in favour of the assessee.

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Issues: Whether the non-production of purchase bills at the time of inspection, by itself, justified treating the stock as suppressed turnover and restoring the original assessment, when the purchases were subsequently accounted for in the books and tax was paid.

Analysis: The dealer was found, at inspection, to be unable to produce purchase bills for certain stocks of groundnut kernels. However, the materials on record showed that the purchases were later brought into the accounts and the tax due was paid. The mere absence of bills on the date of inspection did not, by itself, establish suppression, especially when the stock was reflected in the purchase register and the defects stood rectified subsequently. The appellate authority had therefore erred in interfering with the order that had accepted the explanation and granted relief.

Conclusion: The non-production of purchase bills at inspection did not justify a finding of suppression in the facts of the case, and the order of the appellate tribunal was set aside in favour of the assessee.

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