1983 (6) TMI 173

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..... ts were written upto 9th June, 1977. He also took stock for certain items. Those items were verified with reference to the accounts and he found certain deficiency of the stocks. Again there was an inspection on 2nd February, 1978. At this stage, there was again a physical verification of the stocks and there was a certain deficiency of stocks. There was again an inspection of the premises on 15th December, 1977 when it was found that the assessee was not maintaining the stock and production accounts upto-date. Certain records and slips were also recovered. Out of the slips recovered from the assessee, slips Nos. 1 to 21, 39 and 44 and a pocket notebook revealed that the dealer had advanced money to labourers to the extent of Rs. 12,613.87 .....

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..... e suppressed transactions. It also sustained the levy of penalty at Rs. 2,803. In this tax case, the assessee only questions the order of the Tribunal so far as it relates to the levy of penalty. According to the learned counsel for the assessee, in this case, the assessee gave an explanation as to why the slips which formed the basis of the addition of Rs. 56,071 do not relate to it and that those are the slips maintained by its contractors. That explanation was not accepted by the authorities all through, including the Tribunal. As a matter of fact, the learned counsel for the assessee does not question the order of the Tribunal so far as it sustained the addition of Rs. 56,071. What is contended by the learned counsel for the assessee i .....

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..... the levy of penalty is not automatic and that the considerations to be taken in connection with assessment are different from the considerations which have to weigh in the matter of penalty. In that case, if the assessee's explanation that he was a broker had been accepted there would not be any room for making a best judgment assessment. Since the assessee's explanation went to the root of the matter, that is regarding his assessability to sales tax under the Tamil Nadu General Sales Tax Act, it was held by this Court that merely because a best judgment assessment came to be made after rejecting the explanation given by the assessee, it will not ipso facto lead to the fact that the assessee has suppressed the turnover. In this case, the fa .....

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