No.298 of 2006)The State of Tamilnadurepresented by theDeputy Commissioner (CT)Madurai Divsion, Madurai v. A, Khanpalayam 2nd Street,Madurai

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 14-07-2011THE HONOURABLE MRS.JUSTICE CHITRA VENKATARAMANANDTHE HONOURABLE MR.JUSTICE M.JAICHANDRENTax Case No.730 of 2006(Revision No.298 of 2006)The State of Tamilnadurepresented by the Deputy Commissioner (CT)Madurai Divsion, Madurai... Petitioner. VersusTvl. Bhagavan Metals,69A, Khanpalayam 2nd Street, Madurai... Respondent. Prayer: Revision Petition filed to revise the order of the SalesTax Appellate Tribunal (AB) Madurai, dated 11.8.1999, in MaduraiTribunal Appeal No.101 of 1996 and against the order of the Appellate Assistant Commissioner (CT) Madurai (South) in TNGSTNo.471558/95-94 dated 3.11.1995 and against the proceedings of the Commercial Tax Officer, Munichalai Road, Assessment Circle, Madurai. For Petitioner: Mr.R.Sivaraman Special Government PleaderFor Respondent: Mr.M.Nanda KumarO R D E R(Order of the Court was made by CHITRA VENKATARAMAN,J.)The revenue is on revision, as against the order of the SalesTax Appellate Tribunal, relating to the assessment year 1993-1994.2. The place of business of the appellants was subjected toinspection by the Enforcement Wing Officers, on 25.8.1993, wherein, they found deficit stock of 114.790 kgs of S.S.Sheets. Theverification of the extracted bills of inter-state purchase ofS.S.Patta and S.S.Wares, with reference to the accounts revealedinter-state purchase of S.S.wares, S.S.Sheet and S.S.patta for 130kgs 1824 kgs and 2510 kgs, respectively, and the same were notaccounted for in the accounts of the assessee. Thus, based on theinspection results, the Assessing Officer determined the total andtaxable turnover and levied penalty, under Section 12(3) of the Tamil Nadu General Sales Tax Act, 1959. https://hcservices.ecourts.gov.in/hcservices/

It is seen from the reading of the assessment order that inrespect of the inter-state purchase relating to the three billssecured at the time of inspection by the Enforcement Officers, theassessee denied the purchase, on the ground that they had not takendelivery of the inter-state purchase. Evidently, the RegistrationCertificate Numbers of the sellers were not found in the bills. After considering the objections taken, the assessment as regardsthe inter-state purchases was made.

The asseseee preferred an appeal before the AppellateAssistant Commissioner who pointed out the stock variation noticedat the time of inspection and that the omission to record theinterstate purchase amounting to Rs.1,19,469/-, was a clearindication of the purchase suppression and sales omission. Going bythe materials thus available, the Appellate Assistant Commissionerconfirmed the assessment on actual suppression. However, as regardsthe two times addition made for probable omission, the AppellateAssistant Commissioner sustained the same at the equal time. Corresponding penalty was thus sustained by the Appellate AssistantCommissioner.

Not satisfied with the relief thus granted, the assesseewent on appeal before the Sales Tax Appellate Tribunal, wherein, the assessee took the plea that the documents seized and theextracts taken from the check post clearly showed that the outsidestate dealers names were not shown along with the address. Thus, the assessee contended that there was no material to hold thatthere was purchase suppression leading to a sales omission.

In a very cryptic order passed by the Sales Tax AppellateTribunal, the Tribunal accepted the plea of the assessee by stating"the argument of the learned Advocate seems to be correct". Exceptfor extracting the arguments of the learned Advocate, the order ofthe Tribunal carries no discussion referring the materials tocancel the additions made on the basis of the actual materialsrecovered. The Tribunal held that while cancelling the actualsuppression, the Appellate Assistant Commissioner ought to havecancelled the addition made twice on the probable suppression andomission. Thus, the Tribunal deleted the equal addition made to theactual suppression. The Tribunal, thus, upheld the actualsuppression and deleted the equal addition, and correspondingly, reduced the penalty. Aggrieved by the same, the Revenue is onappeal before this Court.

A reading of the order of the Assessing Officer, the Appellate Assistant Commissioner and the Tribunal shows theinconsistent stand taken by the assessee. While before theassessing officer the assessee denied having any transaction withthe Delhi parties, before the Tribunal, the assessee accepted thepurchase effected from these sources. Thus, the extracts and thestock variation clearly pointed out the nature of dealing of theassessee warranting equal addition, as had been done by the Appellate Assistant Commissioner. https://hcservices.ecourts.gov.in/hcservices/

As already pointed out, the Tribunal passed a verymechanical order, extracted the arguments and accepted the plea ofthe assessee on the face value to delete the equal time addition. Although, normally, on a revision this Court does interfere withthe order of the Tribunal, where there are findings of the Tribunal, which is the highest fact finding authority in thehierarchy of appeal and revision authorities, when the order of the Tribunal lacks any material to base its view and when there is nodiscussion at all as to why it thought fit to cancel the estimatedaddition, on the face of the materials available, as had been foundby the Assessing Officer, as well as the Appellate AssistantCommissioner, we uphold the contention of the Revenue. Consequently, we have no hesitation in allowing the Tax CaseRevision, thereby, we set aside the order of the Tribunal andrestore the order of the Appellate Assistant Commissioner. The TaxCase is allowed. No costs. cshSd/-Asst. Registrar//True Copy//Sub Asst. RegistrarTo1.The Assistant Registrar, Income Tax Appellate Tribunal, III Floor, Rajaji Bhavan, Besant Nagar, Chennai-90. 2. The Deputy Commissioner (CT)Madurai Division, Madurai.3. The Appellate Assistant Commissioner, Madurai.4. The Commercial Tax Officer, Munichalai Road, Madurai.+ 1 cc to Spl Government Pleader (T), SR No.42404+ 1 cc to Mr. S. Balamurugan, Advocate SR No.42562SGL(CO)SR/5.9.2011Tax Case (Appeal) No.730 of 2006