AUGUSTHY THOMAS Vs. STATE OF KERALA

JUDGEMENT

(1.) THIS revision is directed against the decision of the Kerala Sales Tax Appellate Tribunal dated 22nd January, 1983, in Tribunal Appeal No. 487 of 1980. The short facts could be stated as follows : The petitioner was an assessee to sales tax on the file of the Sales Tax Officer, Vaikom. He is stated to be a dealer in rubber. For the year 1977-78, he returned a turnover of Rs. 21,57,121. 56; and with reference to this entire amount he claimed exemption. Thereafter, the assessing authority detected that there was a suppression to the tune of Rs. 1,79,614. 00; and therefore, he added an amount of Rs. 3,59,230. 00 to the returned turnover. It is the correctness of this that is under challenge in this revision. According to the counsel for the petitioner, there was no basis, legal, or factual, for the addition of twice the suppressed turnover detected to the turnover returned.

(2.) IN support of his arguments, the counsel for the petitioner relied on three decisions. The first decision cited is one of this Court reported in Chandunny Nair Son v. State of Kerala ILR (1962) Ker 307. That was a case in which the assessee's shop was inspected by the officers of the sales tax department on 2nd March, 1956, when it was discovered that the assessee had secreted a book containing a record of clandestine transactions. The inspection of the stock of goods showed suppression of turnover by the assessee. By comparison with the stock on 13th February, 1956, the Sales Tax Officer also found that there was suppression of commission sales on that day. The assessee's explanation that there was no suppression was not accepted. This Court went into material that was purported to have been relied on by the Sales Tax Officer and found that there was really no material to support the conclusion reached by the Sales Tax Officer. Particularly, it was observed that it was difficult to understand how a secret book not produced would justify the conclusion of the turnover being suppressed to that extent to which the taxing authorities have held in that case. Clearly on the facts of the case, the case onhand could be distinguished.

(3.) ONCE suppression has been proved or admitted, it is the legitimate right of the taxing authority to add to the disclosed turnover such reasonable amounts as is warranted by the facts and circumstances of the case. In a case where suppression detected itself comes to Rs. 1,79,614. 00, the total addition of Rs. 3,59,230 which represent just twice the actual value of the suppressed turnover detected, could not by any reasonable standard be stated to be excessive, unreasonable or arbitrary.