Case Law Details
Audco India Limited Vs Commercial Tax Officer (Madras High Court)
In the given case the assessment was made by the assessing authority, not accepting the turnover reported in the dealier’s returns. It is seen further that the appellate Assistant Commissioner had directed to reconsider the assessment made on a major portion of the disputed turnover ie., the assessment made on Rs.1,25,08,358/- and also that created on a further Rs.40,05,778/-. The assessment made by the Assessing Officer has thus not reached its finality and the total tax demand of the assessment year was not finally determined as on the date of Appellate Assistant Commissioner’s order.
Having heard the learned counsel for the parties, HC are of the opinion that the parameters of Section 12(3)(b) of the Act are not satisfied in the present case. Section 12(3)(b) provides for imposition of penalty in case of submission of incorrect or incomplete return by the Assessee. Both the grounds given above for imposition of additional tax on the Assessee did not, in our opinion, result in Best Judgment Assessment against the Assessee and it cannot amount to filing of incorrect or incomplete return by the Assessee. On debatable issues, even if the addition in taxable turnover is made by the Assessing Officer, it does not amount to Best Judgment Assessment, which can be passed, only if the regular books of accounts and the return filed by the Assessee are rejected for given reasons. Therefore, the learned Tribunal has erred in relying upon the insertion of the Explanation in Section 12(3) of the Act at a later date with effect from 01.04.1996 to uphold such penalty in the year 1993-94. In our opinion, the Explanation to Section 12(3) does not get attracted to the facts of the present case at all.
The Writ Petition filed by the Assessee, in our opinion, therefore deserves to be allowed and the same is accordingly allowed and the order passed by the learned Tribunal is set aside. No costs.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
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