Case Law Details
Brief of the Case
ITAT Chennai held In the case of ACIT vs. Sh. R. Paneerselvam (Individual) that normally, the sale price mentioned in the menu card would be the sale price of the liquor. However, the fact is that the liquor shops are giving discount on the liquor sold to their corporate guests, walk in customers, etc. for various reasons. One of the reasons presumably may be to attract many customers. The menu card or tariff card said to be found during the course of survey operation does not mention or disclose any of the discounts said to be given by the assessee during happy hours to corporate guests, walk in customers, etc. However, we cannot totally rule out the claim of the assessee that certain discounts are given to the corporate guests, walk in customers and happy hours discount. Also, in the absence of any material like reference in tariff card or menu card, it cannot be ruled out that the assessee inflated the discount. Hence, taking into consideration the nature of trade and material found during the course of survey operation and the statement recorded from the person in-charge of Bar, estimation of sale suppression modified at 26% instead of 56.33% estimated by the AO.
Facts of the Case
A survey under Section 133A was conducted on 27.02.2008 in the business premises of the assessee. During the course of survey operation, incriminating materials were found in relation to suppression of sale of liquor at Rohini International Bar, T. Nagar, Chennai. According to the revenue, in the Permit Room of Rohini International Bar, the price of liquor entered in daily stock sheet was substantially less than the price mentioned in the menu card. The assessee kept the current books in the Bar. On examination of one Shri Raju, in-charge of Rohini International Bar, it was found that suppression of sale was done from 5 to 6 years earlier. The said Shri Raju further confirmed that the Bar bill books would be destroyed and separate set of sale bills would be prepared underlying the sale price. The Investigation Department worked out the average sale suppression at 56.33%.
The revenue further submitted that the assessee explained before the Assessing Officer that the collection from Rohini International Bar was calculated on the basis of the price mentioned in the menu card. According to the Ld. D.R., the assessee further explained that the liquor is not sold at the prices mentioned in the tariff card or menu card. In fact discount was given at 50% to 10%. Therefore, indirectly, , the assessee accepted that there was suppression of sale. Accordingly, the Assessing Officer estimated the suppression of sale in Rohini International Bar at 56.33%.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
