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TMI Blog2025 (5) TMI 851X X X X Extracts X X X X X X X X Extracts X X X X ..... rs 2014-15, 2015-16, 2016-17 and 2017-18. The matter was earlier remanded for the petitioner to avail alternative remedy vide order dated 7th March, 2022 passed in WP(C) No.221 of 2022. The Assessing Authority had by the order dated 29.07.2019 imposed tax, interest and penalty upon the petitioner which was challenged in revision under Section 70(2) of the TVAT Act, 2004 before the learned Commissioner of Taxes after liberty granted by this Court. The revision petitions have been decided vide order dated 15th October, 2022 by remanding the matters relating to A.Y. 2015-16, 2016-17 & 2017-18 on the question of imposition of penalty after due notice whereas the matters relating to the period 2014-15 was remanded to the Assessing Authority to take a fresh decision after due notice. Thereafter, the petitioner preferred a review petition under Section 74 of the TVAT Act, 2004 which was dismissed on 11th May, 2023. Petitioner has approached this Court through the instant revision petition under Section 72 of the TVAT Act, 2004 and also invoking Article 227 of the Constitution of India. By order dated 24th January, 2024, delay of 239 days in preferring the instant revision petitions was co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prosecution has been initiated, the limitation as specified in this subsection shall not apply. (2) Any assessment made or penalty imposed under this Chapter shall be without prejudice to prosecution for any offence under this Act." If the Assessing Authority had not issued any notice before proceeding for assessment for the relevant year 2014-15 and had erroneously assessed the tax returns for the said period by the common impugned order dated 29th July, 2019, the same cannot be reopened on the basis of revisional order dated 15th October, 2022 as it would be barred beyond five years from the relevant date of the tax period 2014-2015. Apart from that, learned counsel for the petitioner and the revenue both have pointed out that as per the common assessment order dated 29th July, 2019 the Assessing Authority has found Nil tax liability. The return filed by the petitioner has been accepted. In that way, the revisional order dated 15th October, 2022 remanding the matter for re-assessment for the year 2014-15 is unsustainable in law and is accordingly set aside. [5] During course of argument, learned counsel for the petitioner does not press CRP No. 45 of 2023 relating to the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s 25 (4) (d) of the TVAT Act. During the period of under assessment the dealer did not obtain any statutory permits in form XXIV, form XXVI, form XXVII, "C" form and "F" form. The dealer furnish audited balance sheet for the year 2014-15 to 2017-18 (up to 30th June, 2017) The facts and figures have been viewed carefully and it appears from the records that the dealer shown huge amount of stock. The dealer has earned margin of profit @ 1.52% for the assessment year 2014-15 to 2015-16 and 1.54% for the assessment year 2016-17 and 2017-18 (up to 30th June, 2017). The dealer is here by asked to explain regarding low profit of margin and variation of profit margin during the period of under assessment. Md. Majumder proprietor of the firm stated that due to tough competition of market and to survive in competition market for wholesale business he had to sold the goods profit margin @ 1.52% for the assessment year 2014-15 to 2015-16 and profit margin @ 1.54% for the assessment year 2016-17 and 2017-18 (up to 30th June, 2017). His explanation is accepted. The dealer shown the sale price of per MT cement of Rs.5417.86 for the financial year 2014-15 Rs.5440 for the financial year 2015-15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the respondent No.4. Petitioner has, therefore, raised this ground before the Revisional Authority as well at paragraph (F) and (G) of the present revision petition. The Revisional Authority has completely failed to take note of the plea raised by the petitioner that the determination of enhanced turnover by the Assessing Authority without rejecting the returns for the relevant year 2017-18 is without any materials and, therefore, unsustainable in law. As a result of enhancement of the turnover to Rs. 11,88,90541/- the total tax liability payable by the petitioner has risen to Rs. 1,72,39,128/- compared to the tax of Rs. 65,52,560/- as per the return filed by the petitioner. [8] It is further submitted that learned Assessing Authority had proceeded to impose penalty under Section 75A and also under Section 25 (4) (d) of the TVAT Act, 2004 for delay in filing returns for the month of May and June, 2017 which was also unsustainable in law as no notice to that effect was issued. The learned Revisional Authority has while remanding the matter only on the question of penalty on the ground of non-service of notice under Section 25 (4) (d) and under Section 75A of the TVAT Act, 2004 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned since both the parties submit that the total tax liability has been deposited including the penalty component. In such circumstances, the impugned revisional order remanding the matter for imposition of penalty after fresh service of notice upon the petitioner for these two years would be meaningless and have been accordingly interfered with in the forgoing part of this order. So far as the tax period 2017-18 concerning the months of April to June, 2017 is concerned, learned counsel for the revenue has not been able to show that the returns for these three months submitted by the petitioner have been rejected. On the other hand, the assessment order dated 29th July, 2019 does not reflect any exercise for determining a turnover of Rs. 11,88,90541/- on the basis of best judgment assessment as there is no exercise to that effect undertaken by the Assessing Authority nor are there any materials reflected in the assessment order. In this regard, reliance is placed on the decision of the Apex Court in the case of The Commissioner of Sales Tax, Madhya Pradesh vrs. M/S. H.M. Esufali, H.M. Abdulali, Siyaganj, Main Road, Indore reported in (1973) 2 SCC 137; paragraphs-7 to 9 are extr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he entries therein do not relate to nil dealings. But at a later stage, he conceded that that bill book was his and the entries therein related to his dealings. It is now proved as well as admitted that his dealings outside his accounts during a period of 19 days were of the value of Rs 31,171.28. From this circumstance, it was open to the Sales Tax Officer to infer that the assessee had large scale dealings outside his accounts. The assessee has neither pleaded nor established any justifiable reason for not entering in his accounts the dealings noted in the bill book seized. It is obvious that he was maintaining false accounts to evade payment of sales tax. In such a situation, it was not possible for the Sales Tax Officer to find out precisely the turnover suppressed. He could only make an estimate of the suppressed turnover on the basis of the material before him. So long as the estimate made by him is not arbitrary and has nexus with facts discovered, the same cannot be questioned. In the very nature of things the estimate made may be an over-estimate or an underestimate. But that is no ground for interfering with his "best-judgment". It is true that the basis adopted by the of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is even though the courts may think that it is not the most appropriate basis, the estimate made by the assessing authority cannot be disturbed. In the present case, there is no dispute that the assessee's accounts were rightly discarded. We do not agree with the High Court that it is the duty of the assessing authority to adduce proof in support of its estimate. The basis adopted, by the Sales Tax Officer was a relevant one whether it was the most appropriate or not. Hence the High Court was not justified in interfering with the same. 9. The law relating to "best-judgment" assessment is the same both in the case of Income Tax assessment as well as in the case of sales tax assessment. The scope of "best-judgment" assessment under the Income Tax law came up for consideration before the Judicial Committee as early as 1937 in Commissioner of Income Tax, Central and U.P. v. Laxminarain Badridas. [(1937) 5 ITR 170] Therein Lord Russel of Killowen speaking for the Judicial Committee observed (at p. 180): "The Officer is to make an assessment to the best of his judgment against a person who is in default as regards supplying information. He must not act dishonestly, or vindictivel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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