TMI Blog2013 (11) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... available, the Joint Commissioner sustained the method of accounting adopted by the Assessing Officer. - There is no violation in the order of the Joint Commissioner in approving the proportion guiding the best of judgment assessment. Keeping of a stock register by the manufacturer is of importance to verify the assessee's account for a quantitative tally of different goods attracting different rates; if such a stock book is not maintained, there being no other material to identify the different goods, it leads to the conclusion that the account books are not reliable or that particulars are not properly verifiable. Thus, we do not find that there is any arbitrariness in fixing second sales exemption based on the formula - Decided agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see had not maintained stock account as required under Rule 26 of the Tamil Nadu General Sales Tax Rules, restriction of claim of exemption under second sales only at 27% on the total purchase of hides was justified. 4. Aggrieved by the same, the assessee went on appeal before the Appellate Assistant Commissioner. As regards the stock variations found at the time of inspection, the Appellate Assistant Commissioner confirmed the estimates on the sales turnover by rejecting the account. As regards the five times addition for probable omission for the previous period, the First Appellate Authority pointed out that there were no materials to prove that the assessee was involved in similar pattern of suppression. Thus, equal time addition besi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assistant Commissioner. 6. The Joint Commissioner considered the objections and pointed out that the assessee had effected local purchase of tanned skins for 19,719 pieces and the second sales were however again for 21,867 pieces. The assessee purchased 52,705 pieces of raw skins. Taking note of the purchase of tanned skins for 19,719 pieces and the total sales of tanned skin for 21,867 pieces, the Revisional Authority justified adoption of formula for exemption to the extent of 27%. He further pointed out to the details available at page 197 of the assessment file, indicating the following:- Inter-State purchase of raw skins for Rs. 58,10,725/- Local purchase of raw skins Rs. 29,550/- Local purch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessing Officer had not made any allegation as regards the account books not indicating materials to reject the second sales exemption, the adoption of the formula is totally uncalled for. He further pointed out that when the details are available from the ledger, the Joint Commissioner ought not to have rejected the plea for granting the second sales exemption as claimed by the assessee. There was no allegation that the assessee had not maintained separate stock account or monthly account; in the circumstances, the Revenue ought not to have adopted the formula. 8. Rule 26 of the TNGST Rules contains the provisions regarding maintenance of accounts. It also contains provisions regarding maintenance of separate books of accounts for differ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee as well as locally purchased tanned skins, the Assessing Officer found that the claim of the assessee for exemption of turnover of Rs.61,01,040/- could not be granted as a matter of course. Given the fact that the details regarding the tax suffered tanned skins had also gone for the claim for second sales, the Assessing Officer adopted formula, which is the one and only course available for the Assessing Officer in arriving at assessing the turnover for suppression and taxability of the turnover. The Appellate Assistant Commissioner, however, upset this order and held that in the absence of any misclassification pointed out and in the light of the same issues considered in the earlier order by the Sales Tax Appellate Tribunal, the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of accounting adopted by the Assessing Officer. 13. We do not find any violation in the order of the Joint Commissioner in approving the proportion guiding the best of judgment assessment. 14. Learned counsel for the assessee pointed out to the decision of this Court in the case of K.Ramalinga Mudaliar Co., Vs. State and another reported in (1992) 86 STC 475, wherein, this Court pointed out that a mere failure to maintain stock register, by itself, would not be a sufficient ground to reject the return and that in the absence of wrong classification, best judgment assessment is not justified. 15. As already stated in the preceding paragraph, keeping of a stock register by the manufacturer is of importance to verify the assessee's acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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