TaxTMI 
TaxTMI 
2026 (7) TMI 1046
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.... inspection of its premises by the Income Tax Officers on 13.09.2005, was taken into consideration by the Assessing Officer during the course of checking the accounts. The unaccounted stock found during the Income Tax Department's inspection was later declared to the Sales Tax Department by way of revised return. Hence, the Assessing Authority held that, but for the Income Tax Department inspection and the unravelling of the unaccounted stock, the trader would not have disclosed the additional turnover by filing the revised return. Therefore, the Assessing Officer concluded that there was suppression of purchases as well as sales and levied tax, equal additions and penalty after determining the total turnover and taxable turnover, as under: Total Turnover Determined Rs.5,07,45,693/- Taxable Turnover Determined Rs.4,82,63,723/- Tax Rs. Surcharge Rs. Due 7,70,077/- 38,503/- Paid 1,22,300/- 5,628/- Balance 6,47,277/- 32,875/- A Notice in Form "B" are issued. Levy of Penalty under Section 12(3)(b): Tax and Surcharge due after deducting the tax and surcharge on estimated suppression. Tax Rs. ....
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....al of the appeal, the trader had taken up the matter on further appeal before the Sales Tax Appellate Tribunal questioning the order of the Assessing Officer as confirmed by the Appellate Authority. The tribunal, on considering the grounds of appeal filed by the trader, had formulated the following point to be decided:- A. Whether the confirmation of assessment by the first appellate authority on the excess stock of Rs. 82,00,000/- related to own old gold jewels and the excess of stock of gold jewels of Rs. 9,30,980/- connected with repair and polishing is in order or not? B. Whether the confirmation of assessment made on the excess stock related to own silver jewels of Rs. 8,20,341/- and on the excess stock of silver articles of Rs. 17,549/- by the first appellate authority is in order or not? C. Whether the confirmation of assessment made on sales estimation of Rs. 1,31/28,523/- @ 2% related to gold jewels and the Rs. 2,40,944/- @ 4% related to silver articles by the first appellate authority is in order or not? D. Whether the assessment made on equal time addition for purchase omission of Rs. 91,30,980/- @ 1% connected with excess stock gold j....
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....37,890/- @ 1% and Rs. 2,40,944/- @ 4% confirmed by the first appellate authority are set aside and reduced to an adhoc addition of 10% on estimation instead of equal addition is fixed as addition for defects. Thus these points are answered accordingly. Point E: Thus it is noticed that the excess stock of gold and silver jewels had not been disclosed by the appellants/assessee's either in the regular accounts or in the regular monthly returns till 13.9.2005. Therefore the contention of the learned counsel that the excess stock was brought into accounts could not be considerable, and treated as already available in the accounts. Therefore the contention of the learned counsel that the purchase suppression should be considered as suppression on presumption is not acceptable. A perusal of the assessment order dated 31.03.2008 clearly shows that the penalty of Rs. 3,62,071/- has been properly levied as per the provisions and as per the explanations of the Section 12 (3)(b) of the Tamil Nadu General Sales Tax Act, 1959. Therefore, we do not find any need for intervention in the levy of penalty of Rs. 3,62,071/- and on the order of the first appellate authority. Therefore, we are....
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....sclosing the entire turnover detected by the Income Tax Officials. While so, the voluntary disclosure of turnover through the revised return not been taken into consideration by the Department. Further, it is contended that the assessment of alleged suppression is only on generalities of probabilities. The Tribunal failed to independently apply its mind in respect of the explanations offered by the trader regarding the alleged purchase suppression. The Tribunal failed to consider judgments which have held that subsequent accounting of transactions detected at the time of inspection will not amount to suppression. Though being the final authority on fact-finding, the Tribunal grossly erred in accepting the case of the Revenue without considering the facts and law in their proper perspective. 10. In support of the above submissions, the following judgments were relied:- 1. Jayalakshmi Oil Mills vs. State of Tamil Nadu reported in 2012 (2) TMI 450. 2. S.R.S.Industries vs. State of Tamil Nadu reported in 2010 SCC Online Mad 6455. 3. Ram Sun Fabi Techs vs. State of Tamil Nadu reported in 2008 SCC Online Mad 1257. 4. Appollo Saline Pharmaceuticals (....
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.... ....... 14. The view taken by the Tribunal is a probable view, and the High Court while exercising its revisionary jurisdiction should not substitute its own view to the view taken by the last fact finding Authority. In light of the above, we are of the view that there is no error in the decisions of the authorities below. 13. The sequence of events in this case which is very crucial, since the determination of willful suppression to impose equal addition and penalty, depends on it. 14. In the Jayalakshmi Oil Mills case, cited supra and relied by the trader, the Court upheld the levy of additional tax based on account of stock variation and on the basis of recovered slips. However, the Court deleted the equal addition made on the estimation for probable suppression, since the equal addition was only based on estimate that too probable suppression. It is only a guesswork. There is no material for making equal amount for probable suppression. A similar view taken by another Division Bench of this Court in S.R.S. Industries case, cited supra. 15. In the Appollo Saline Pharmaceuticals (P) Ltd case, cited supra and relied by the revision petitioner, the Divisi....
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.... the Income Tax official inspection. The non-disclosure of purchases and the value of the unaccounted stocks were not on any guesswork, but based on materials collected during the Income Tax inspection and the revised return filed by the trader. 18. The Tribunal, after considering the explanation of the trader had modified the equal addition and reduced it to 10%. This shows independent application of mind and re-assessment of the facts by the tribunal. Having found from the documents that the suppression of purchases and, as a corollary, the suppression of sales, mere submission of revised return after the income tax department inspection is not sufficient to presume bonafide about the omission to maintain records of purchases and sales. 19. From the assessment order, we find on 13.09.2005, at the time of Income Tax Officials inspection, as per the stock book maintained by the trader, the gold stock was 21545.500 grams, whereas the Income Tax Officials found 39220.960 grams of gold jewels. Likewise, the silver stock as per the books maintained by the trader was 53.249 kg. Whereas, the Income Tax Officials found 144.398 kg of silver jewels. Against the excess stock of 17675.4....