2000 (3) TMI 1049

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....ons arrived at and observations made by a division Bench of this Court in Lovely Thomas v. State of Kerala [1999] 113 STC 505, the present reference has been made to a larger Bench. 2.. The view expressed in Lovely Thomas' case [1999] 113 STC 505 (Ker), was that where unaccounted purchases are there, it is for the Revenue to explain as to wherefrom the unaccounted purchases were made. This conclu....

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....nce the source of purchase. The assessee is entitled to have evidence produced and an inference to be drawn therefrom. There is a prima facie presumption that one who is found in possession of an article or thing is the owner thereof unless that presumption is rebutted by cogent evidence. Section 110 of the Indian Evidence Act, 1872 (in short "the Evidence Act") embodies a salutory principle of co....

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....dence. (See A. Raghavamma v. A. Chenchamma AIR 1964 SC 136). In view of the above position in law conclusions in Lovely Thomas' case [1999] 113 STC 505 (Ker), are not acceptable. 4.. The other question is whether an adverse inference warranting addition can be drawn when books of accounts are found to be not fully posted at the time of inspection. It would depend upon fact-situation of each case.....