C.K.RAJAN Vs. STATE OF KERALA

JUDGEMENT

(1.) Two revisions filed by the State and two by the assessee are before us. The revisions arise from the common order of the Tribunal in appeals filed by the State and also by the assessee.

(2.) The assessee is said to be engaged in manufacturing of gold ornaments carried on behalf of third party jeweller's on job work basis. The assessee's place of business was subjected to inspection on 26.09.2013 wherein huge stock of gold and ornaments were detected. The Intelligence Wing detected actual suppression of sales of Rs.3,33,69,622/-. The assessee compounded the offences alleged; which also included failure to take registration under the Kerala Value Added Tax Act, 2003 (hereinafter "the KVAT Act") and paid an amount of Rs.8 lakhs as compounding fee. On assessment proceedings being carried out, the turnover suppression detected by the Intelligence Officer was adopted and the Assessing Officer added 90% of the said turnover as liable to tax on purchases made, under Section 6(2) of the KVAT Act. An equal addition was made towards probable omissions and suppression. The total turnover on best judgment came to Rs.12,68,04,563/-. The Assessing Officer also declined the special rebate under Section 12 since the assessee was not a registered dealer.

(3.) In first appeal, the addition made under section 6(2) as also the estimation made towards the probable omission and suppression on that aspect was deleted. The declining of special rebate stood confirmed. The State filed an appeal before the Tribunal against the deletion of the addition made under Section 6(2) and prayed for restoration of the same. The assessee filed an appeal against the sales turnover adopted by the Assessing Officer, asserting that he was engaged only in job-works and the stock found belongs to a third party Jeweller. The assessee contended that there was no purchase or sale effected of gold or gold ornaments by the assessee. The Tribunal, in the State's appeal restored the additions made under section 6(2) as also the estimation made of a further equal addition towards the probable omissions and suppression. In the assessee's appeal, the Tribunal while affirming the best judgment assessment, specifically with respect to the adoption of sales turnover and the equal addition made; permitted special rebate under section 12.