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2016 (8) TMI 668 - MADRAS HIGH COURT

2016 (8) TMI 668 - MADRAS HIGH COURT - TMI - Suppression of sales turnover - estimation suppressed turnover - ad-hoc addition of 20% - Held that:- Mere one day sales could not be attributed to estimate the whole year without considering the festival season, rainy season and other natural calamities. It is also seen that the first Appellate Authority as well as the second Appellate Authority had considered all the relevant materials and came to the correct conclusion. The Assessing Officer had on .....

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of the Court was made by S. Manikumar, J. ) Tax Case (Revision) is filed by the Joint Commissioner (CT), State of Tamil Nadu, Chennai (Central) Division, Chennai, against the order made in S.T.A.No.81 of 2009, dated 28.10.2013, passed by the Tamil Nadu Sales Tax Appellate Tribunal (Additional Bench), Chennai. 2. Brief facts leading to the revision petition are as follows: Saravana Stores (Fast Food), dealers in food and drinks, were assessed on a total and taxable turnover of ₹ 46,46,105/- .....

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to food and drinks, at 2% under section 3(D) of the abovesaid Act and ₹ 8,63,200/- relating to sale of audio cassettes, at 2% under section 7A of the same Act. He also levied tax, at 12% on a turnover of ₹ 85,800/-, an estimation made on cassette, for the period between 26.02.2005 and 03.03.2005 and also levied penalty, under section 12(3)(b) of the said Act. 3. Aggrieved against the revision order, the dealer has filed appeal in A.P.No.121 of 2007, before the Appellate Deputy Commi .....

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sales turnover, which is not a scientific method and not justified, as per the decision reported in State of Tamil Nadu v. Tvl.New Kamaliya Hotel reported in 147 STC 111 and remanded the matter on the levy of penalty, with a specific direction to levy penalty, under section 16(2) of the Act, with reference, to actual suppression only. 4. Aggrieved against the order of the first appellate authority, State has filed second appeal in STA.No.81/2009, before the Tamil Nadu Sales Tax Appellate Tribun .....

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rity's findings that the sales suppression of food and drinks is at ₹ 9,29,221/- being the 20% of the reported turnover, omitting the estimated suppression of ₹ 72,59,944/- without any logical conclusion for arriving the suppression at 20% on the reported turnover?. (2) Whether on the facts and in the circumstances of the case the Tribunal was right in law in accepting the First Appellate Authority finding that sales suppression of audio cassette is at ₹ 5,200/- with equal .....

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ting the judicial discipline?. 6. Though Mr.V.Haribabu, learned Additional Government Pleader for Taxes submitted that the Tribunal has erred in restricting the sales turn over for food and drinks to 20% of the book turnover, notwithstanding the fact that the Enforcement Wing Officers, during their inspection on 26.02.2005, have clearly noticed suppression and that an estimation was made, based on one-day sales turnover and further contended that the Tribunal has erred in relying on a decision o .....

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was sales and purchase suppression, and therefore, the estimation made by the Assessing Officer, was just and reasonable and and that the Appellate Assistant Commissioner erred in deleting the entire additions and the restrictions of the appellate authority to only 20%, required reconsideration. 7. After hearing the learned Senior Standing Counsel for Taxes, at Paragraph 4, the Hon'ble Division Bench in New Kamaliya Hotel's case (cited supra), held as follows: 4. We heard the counsel. Th .....

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h the authorities below also found that there was no omission established by the Revenue. Mere one day sales could not be attributed to estimate the whole year without considering the festival season, rainy season and other natural calamities. It is also seen that the first Appellate Authority as well as the second Appellate Authority had considered all the relevant materials and came to the correct conclusion. The Assessing Officer had only relied on the one day sale for making estimation. The .....

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ed the total and taxable turnover. In the appeal filed by the assessee, the Appellate Assistant Commissioner, deleted the entire estimation, sustained 20% addition, to the book turnover and brought the assessee to the below tax liability. The revenue filed an appeal before the Tamil Nadu Sales Tax Appellate Tribunal (Additional Bench), Madurai, which dismissed the appeal. The substantial question of law, raised in New Kamaliya Hotel's case (cited supra), was, whether the Sales Tax Appellate .....

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