STATE OF KERALA Vs. P.V. MOHANDAS

JUDGEMENT

(1.) The revision is one filed by the State and the issue is one of estimation. We would have normally followed the decision of the Hon'ble Supreme Court in Commissioner of Sales Tax, M.P. v. H.M.Esufali 1973 (2) SCC 137 = (1973) 32 STC 77 (SC) and rejected the revision but for the gross perversity, which stares at us from the order of the Tribunal.

(2.) On facts, it is to be noticed that the assessee runs a restaurant, supplying food and beverages to a Bar; situated in the same premises, by virtue of an agreement. The issue was with respect to the turnover of cooked food and also of soda and soft drinks. The assessee, for the entire year, disclosed a turnover of cooked food at Rs. 6,23,859/- and a 'nil' turnover with respect to soda and soft drinks; despite a total turnover of liquor consumption at Rs 3,29,12,668/-, in the Bar.

(3.) The restaurant of the assessee supplies food and beverages to the Bar Hotel and also serves food to its own customers. The Assessing Officer found the turnover of cooked food and soda and soft drinks to be grossly low and also based on a Shop Inspection Report [SIR], rejected the books of accounts. The Assessing Officer estimated 10% & 3% of the turnover of liquor respectively as that of cooked food and beverages. The first appellate authority confirmed it. The Tribunal reduced the same and confined the addition to Rs. 4 lakhs towards the turnover of cooked food and Rs. 2 lakhs towards the turnover of soda and soft drinks. The reasoning of the Tribunal was that the suppression detected does not warrant an estimation to the extent carried out by the Assessing Officer, as confirmed in appeal. The turnover difference noted on a single day was Rs. 1370/- in the case of food and ingredients and Rs. 1236/- in the case of soda and soft drinks; which does not warrant an addition as made, was the finding.