9911796707
TMI Blog1993 (2) TMI 312X X X X Extracts X X X X X X X X Extracts X X X X ..... ock with reference to the accounts showed excess of 150 tins in the stock of coconut oil, deficit of 44 tins in the stock of gingerly oil, deficit of 8 tins in the stock of castor oil, excess of one tin in the stock of major refined oil, etc. There was also a deficit of 7 bags in the stock of coconut oil cake and excess of 19 bags in the stock of groundnut oil cake. The inspection took place when the assessee's father, Shri Kunhikannan Nair, was in the shop. A detailed inspection report was drawn. The concerned mahazar is available in page 55 of the files. The representative of the assessee, who was available in the shop, declined to sign in the report or acknowledge receipt of a copy of the report. The Intelligence Officer sent notice to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a penalty under section 45-A(1)(b) is leviable. A penalty of Rs. 5,000 was imposed. The assessee filed a revision from the aforesaid order before the Deputy Commissioner of Agricultural Income-tax and Sales Tax, Kannur. By order dated January 3, 1986, the Deputy Commissioner of Agricultural Income-tax and Sales Tax affirmed the levy of penalty. In the revision, the main plea of the assessee was regarding the unreliability of the inspection report dated October 5, 1982. The plea was rejected. It may also be stated that the aforesaid orders passed under section 45-A of the Act and affirmed in revision were assailed before this Court in O.P. No. 306 of 1986. A learned single Judge of this Court, by judgment dated October 5, 1990, dismissed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the shop inspection report was not procured validly to stand the test of law since it was not prepared in the presence of the dealer. It was further held that the presence of the father of the dealer cannot be taken note of in strict legal view of the matter, especially when the father of the dealer has not appended his signature in the shop inspection report in approval of his presence. The Tribunal concluded that in such disputed circumstances, the Inspecting Officer should have prepared a mahazar as provided in the Code of Criminal Procedure, which alone will satisfy the requirements of law. The shop inspection report was held to be not binding on the assessee. Against the acceptance of the plea of the assessee and the direction to ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... course and it is for persons who dispute the accuracy and legality of the same to prove the contra. That has not been done in the instant case. On the other hand, the official act has been found to be correct and justified on facts, in view of the revisional order dated January 3, 1986 and the judgment of this Court in O.P. No. 306 of 1986 dated October 5, 1990. It is not the law in taxation matters that an inspection report, though not in conformity with the law, has no value. It has a probative value and can be relied on for assessment purposes. Reliance was placed on the following decisions: Kuruma v. Queen [1955] AC 197 (PC), M.K. Annamalai Chettiar and Co. v. Deputy Commercial Tax Officer [1965] 16 STC 687 (Mad.), New Street Oil Mills ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment order), 141 (notice for levy of penalty under section 45-A), 145 to 147 (reply by the assessee thereto dated October 25, 1985), 155 and 156 (order levying penalty), 161 and 162 (revisional order confirming the same) and 163 to 166 (order in the first appeal from the order of assessment). The judgment in O.P. No. 306 of 1986 is seen stitched on the top of the assessment files. The Appellate Tribunal has stated in para 9 of its order that it heard both sides and also perused the relevant records and considered all aspects of the issues. The decisions brought to our notice by the Revenue-Annamalai Chettiar and Co.'s case [1965] 16 STC 687 (Mad.), New Street Oil Mills' case [1978] 41 STC 36 (Ker) and Pooran Mal's case [1974] 93 ITR 505 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tally missed by the Sales Tax Appellate Tribunal. This is a very clinching factor to reject the plea of the assessee assailing the inspection report dated October 5, 1982. We are surprised that the departmental member pronouncing the order of the Appellate Tribunal dated February 25, 1991, conveniently missed the above fundamental aspects and proceeded to decide the validity of the inspection report uninformed even by the elementary principles of law governing the said matter. We have no hesitation to hold that the order passed by the Appellate Tribunal is illegal, unreasonable and unfair. On the above grounds, we set aside the order passed by the Appellate Tribunal dated February 25, 1991. 8.. With regard to the plea of the assessee that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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