TMI Blog1995 (12) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... e submits that if the court were to peruse the assessment orders one by one, that it will be evident that the assessing officer did examine the records produced by the assessee and that he did also carefully and applied his mind. The submission that was canvassed by him is in relation to the quantity of the goods, which in these cases happen to be cigarettes and beedies, that were earmarked for consumption in the nonmunicipal areas. He further points out that if one were to look at the relevant figures for all the five years, that the application of mind on the part of the assessing officer will be evident. Even though in keeping with the books produced, certain claims were made for exemption on the ground that this consumption related to n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the tabulation he has pointed out that these percentages vary from 7.83 per cent in 1985-86 to 5.2 per cent in 1986-87, 2.6 per cent in 1987-88, 1.95 per cent in 1988-89 and 2.47 per cent in 1989-90. The notice further proceeds on the footing that these figures are unrealistic. The notice in so many words sets out that the consumption of beedies and cigarettes in non-municipal areas is very much higher than in municipal areas and in any event, the authority has recorded the opinion that the ratio cannot be other than 50: 50. 2.. The appellant's learned advocate has seriously assailed the show cause notice because it is his contention that there was no valid ground in the present case to issue such a notice and his second submission i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ible to issue a show cause notice because that is only the starting point of the exercise and it is open to the assessee to point out that there may be no valid ground on which higher tax should be levied. The learned advocate submits that having regard to the various circumstances, where the returns filed are glaringly at variance, that alone can be a ground for revision. He also submits that as far as the final order is concerned, that if through a process of due investigation that has taken place, the department is formally of the view that there exists a certain percentage as far as the consumption pattern is concerned, that it is open to the department to apply that figure where the assessee has not produced true and correct facts. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use against the assessee. In our considered view, that principle has been totally breached in the present case. Not only is there a reference to the intelligence report in the show cause notice but on the other hand it forms the substantial basis for the final order that has been passed against the assessee without they having been aware of this order. 5.. As far as the main challenge is concerned, we do see considerable substance in the challenge that has been presented by the appellant's learned advocate. What the learned advocate points out, and perhaps with considerable justification, is that none of the earlier findings had been carelessly recorded. He relies on the fact that when the returns were filed by his clients, they themelves ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lligence report and other facts which were not specifically made known to the assessee and they were not confronted with. At one part of the order, there is a specific statement that goods worth a substantial amount of money were unloaded. If such material was proposed to be used in a revision proceeding, then the assessees ought to have been confronted with it so that they could have put forward their explanation. We see considerable justification in the plea that the final order that has been passed cannot be sustained on the basis that the appellants did not have specific notice. Having regard to this situation, the impugned order is liable to be set aside. Normally, we would have let the matter rest at that, but the position that emerge ..... X X X X Extracts X X X X X X X X Extracts X X X X
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