B THANKAPPAN Vs. STATE OF KERALA

JUDGEMENT

(1.) THE short question arising in this tax revision case for consideration is whether the assessing officer was right in resorting to the average running stock method in the jewellery account. This revision relates to the assessment year 1986-87. THE assessee - a dealer in textile and jewellery items - disclosed turnover of both the items. THE assessing authority noticing certain defects rejected the book version of the assessee and resorting to the average running stock method, made an addition to the extent of four times the average running stock in the jewellery account, which was reduced by the appellate authority to two times of the average running stock and that has been affirmed by the Tribunal. THE assessee's business premises was inspected by the intelligence wing on June 30, 1986 and then it was discovered that purchases and sales were not regularly accounted for in the books. At the time of inspection, the intelligence officer found a difference of 4. 200 grams worth Rs. 996. 60. From this, the assessing officer inferred as follows : " This clearly revealed that he has unaccounted purchase of gold in large scale and in order to accommodate the unaccounted purchase he has unaccounted sales also. THE total suppression on the inspection estimated to Rs. 3,601. 66. "

(2.) THE submission of learned counsel for the assessee before us is that the difference in gold ornaments was very insignificant, that is, to the extent of only 4. 200 grams and, therefore, the average running stock method could not have been resorted to by the assessing officer. It is true that no pattern of suppression has been pointed out in this case. THE question for consideration is that when there is no pattern of suppression and when the difference in the stock is only to the extent of 4. 200 grams whether the assessing officer was right in resorting to the average running stock method.