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2016 (7) TMI 881

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..... Sales/Trade Tax Revision No. - 48 of 2005 - - - Dated:- 4-7-2016 - Hon'ble Yashwant Varma, J. For the Applicant : Suyash Agrawal, Rakesh Ranjan Agrawal For the Respondent : C.S.C. ORDER Heard Sri R.R. Agrawal learned senior counsel for the revisionist and Sri B.D. Pandey, learned Standing Counsel. This revision lays challenge to an order passed by the Trade Tax Tribunal upholding an order made by the assessing authority rejecting the books of accounts of the assessee and consequently coming to hold that tax has been evaded in respect of the sale of jute bags valued at ₹ 20,00,000/-. The disputed tax liability was pegged as ₹ 1,20,000/-. The undisputed facts appear to be that the revisionist, who is a .....

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..... iew taken by the assessing authority. Sri Agrawal learned counsel has submitted that the precondition for formation of opinion as contemplated under Section 7(3) did not exist and therefore, the rejection of books of accounts was clearly illegal. He has further submitted that the self assessed tax which was paid by the revisionist on the basis of the audited accounts was not disputed by the State. It was contended that unless the respondents had come to a conclusion that the audited accounts was not worthy of credence, tax could not have been imposed on the basis of the rough/provisional balance sheet. Learned Standing Counsel on the other hand has contended that great variance was found between the rough/provisional balance sheet and .....

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..... ely on the ground that the audited accounts were at variance with the balance sheet which was found in the business premises during the course of survey. This in the opinion of the Court would not justify the rejection of books of accounts maintained by the dealer for more than one reason. A reading of the order of the assessing authority as well as the Tribunal indicates that no reason whatsoever has been recorded to reject the audited balance sheet which was presented by the assessee and on the basis of which self assessed tax was deposited. In the absence of such a finding, in the opinion of this Court, there did not exist a circumstance which warranted rejection of books of accounts . The audited balance sheet would have to be faulte .....

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..... s a faculty to decide matters with wisdom truly and legally. Judgment does not depend upon the arbitrary caprice or a Judge, but on settled and invariable principles of justice. Though there is an element of guess work in a ''best judgment assessment', it shall not be a wild one, but shall have a reasonable nexus to the available material and the circumstances of each case. Though sub section (2) of Section 12 of the Act provides a summary method because of the default of the assessee, it does not enable the assessing authority to function capriciously without regard to the available material. Here, both the assessing authority as well as Tribunal have failed to discharge this statutory obligation which stood placed upon th .....

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