COMMISSIONER OF SALES TAX ORISSA Vs. RAMANARAYAN SITARAM

JUDGEMENT

(1.) ON an application under section 24 (2) (b) of the Orissa Sales Tax Act by the State of Orissa represented by the Commissioner of Sales Tax, this court directed the Sales Tax Tribunal to state a case and refer the following questions for determination :

(2.) THE period of assessment is 1967-68. The assessee is a registered dealer carrying on business in jute, cement, wheat products, sugar, iron, asbestos, etc. , at Jajpur Road, within the jurisdiction of the Sales Tax Officer, Cuttack III Circle. On scrutiny of the books of account it was found that the accounts do not contain the details of purchases of jute as the assessee was purchasing jute from local producers. The accounts were not relied upon as correct and complete. The place of business of the assessee was inspected by the inspecting officer on 30th September, 1967, and on physical verification of stocks with the register, some shortages and excess of articles were found. The assessee could not explain the difference of stocks at the time of inspection. The managing partner of the assessee-firm was asked to sign the statement recorded by the inspector. In view of the fact that details of account of purchases were not kept and large amount of shortages and excess were found on verification, the accounts were rejected and a best judgment assessment was made by the assessing officer enhancing the gross turnover resulting in demand of extra tax.

(3.) THE assessee went up in second appeal to the Sales Tax Tribunal, which accepted the contention of the assessee and held as follows :