TMI Blog2012 (7) TMI 1164X X X X Extracts X X X X X X X X Extracts X X X X ..... tax as a presumptive tax payer under Section 6(5) of the Act. Section 6(5) provides payment of tax at the rate of 0.5% by those dealers whose total turnover for an year is below Rs.50 lakhs; the limit being so for the respective assessment years. 2. For the years 2006-07 and 2007-08, the dealer conceded a turnover respectively of Rs.32,72,510/- and Rs.45,46,917.60. On verification of certain records of the supplier of the assessee, the assessing authority found that for the two years the assessee had suppressed purchase turnover to the tune of Rs.13,32,506/- and Rs.11,55,970/- respectively. Hence, the sales turnover was estimated by adding the gross profit conceded by the assessee in both these years and also made addition of two times ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (iii) Whether the authorities below are justified in adding gross profit without any reasons? 5. The 1st question of law raised is with respect to the authority of the Assessing Officer to make additions for an offence which has already been compounded by the assessee. Admittedly, on suppression being detected, the assessee had moved for composition of the offence under Section 74 of the Act, which was allowed by the assessing authority. The consequence of composition of offence under Section 74(1) is specifically laid down in sub-clause (2). Section 74(2) reads as follows :- On payment of such amount under sub-section (1), no further penal or prosecution proceedings shall be taken against such person, in respect of that offenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suppression has been detected since the purchases of the assessee is only from one supplier. From the facts of the above case, we do not see any warrant for such assumption. There is definitely a pattern of suppression established in the years 2006-07 and 2007-08. The suppression itself is more than 25% of the conceded turnover for both the years. The consistent reduction made by the appellate authorities cannot at all be relied on by the assessee for claiming total exemption from additions. The reduction made by the appellate authorities can only be considered as discretionary exercise, again based on the facts and circumstances of the case. The attempt of the assessee is to make itself eligible for payment of presumptive tax in the year 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was made and the turnover of the assessee determined as per the assessment proceedings exceeded the limit prescribed for presumptive tax payment. In such circumstances, the turnover has to be assessed at the rate applicable under Section 6(1). We see that the Tribunal has made such an observation and has also found that the rate applicable to the goods dealt with by the assessee, i.e., ice cream, is 12.5%. However, on going through the assessment order, we find that the tax has been assessed in the concluding portion at the rate of 0.5% on Rs.50 lakhs and at the rate of 12.5% on Rs.31,67,472/-. That is to say, even on finding that the dealer goes out of the presumptive tax net; upto the limit prescribed for being included in the presumptiv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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