Sayar Jewellers Vs State of Tamil Nadu (Madras High Court)
The Madras High Court considered a revision filed under Section 38 of the Tamil Nadu General Sales Tax Act, 1959 (TNGST Act) challenging the order of the Tamil Nadu Sales Tax Appellate Tribunal dated 31.10.2012.
The revision petitioner, a trader in gold and silver jewellery, filed returns for the assessment year 2005-2006 declaring a total turnover of Rs.19,88,066/- and taxable turnover of Rs.14,32,099/-. During scrutiny, suppression of purchases, excess stock and suppression of sales were detected. The revised return filed by the trader in September 2007, after a surprise inspection by the Income Tax Department on 13.09.2005, disclosed the previously unaccounted stock. The Assessing Officer held that the additional turnover was disclosed only because the Income Tax inspection had unearthed the unaccounted stock. Accordingly, the Assessing Officer determined the total turnover at Rs.5,07,45,693/- and taxable turnover at Rs.4,82,63,723/-, levied the balance tax and surcharge, imposed equal additions, and levied a penalty of Rs.3,62,071/- under Section 12(3)(b) of the TNGST Act.
The trader challenged the assessment before the Appellate Assistant Commissioner (CT), disputing the assessment relating to purchase suppression of gold and silver, sales suppression, equal time additions, and penalty. The Appellate Authority dismissed the appeal, holding that the discovery of unaccounted gold and silver stocks valued at Rs.99,68,870/- during the Income Tax Department’s surprise inspection established that the trader had not maintained true and complete accounts. It further observed that the stock difference was not a solitary instance.
