Judgment:
Rajes Kumar, J.
1. Present revision under Section 11 of the U.P. Trade Tax Act, 1948 (hereinafter referred to as 'the Act') is directed against the order of the Tribunal dated September 7, 1999 relating to the assessment year 1998-99, by which Tribunal has deleted the penalty under Section 15A(1)(c) of the Act.
2. Brief facts of the case are that the opposite party/dealer (hereinafter referred to as 'the dealer') was carrying on the business of manufacture and sale of paints and disclosed a taxable turnover at Rs. 1,58,94,193. The assessing authority rejected the books of account and estimated the turnover at Rs. 1.62 crores by way of best-judgment assessment. The enhancement of the turnover has been made mainly on account of difference in the stock found at the time of survey dated June 6, 1993 made by the S.T.O. (S. I. B.) and on the basis of entries made in exhibit 8, which was the notebook for the period April 8, 1993 to April 6, 1993 (sic). According to the assessing authority, the entries of the notebook valued at Rs. 53,000 were not found entered in the books of account.
3. A perusal of the assessment order filed along with supplementary affidavit reveals that the dealer explained that the alleged stocks were kept in laboratory for testing purposes and was mainly unfinished goods. The assessing authority had not accepted the explanation of the dealer on the ground that such explanation was not given before S.T.O. (S.I.B.). With regard to the entries in the exhibit 8, it was explained that such notebook was maintained by the employee and related to the loading and for the classification of various shades. It was also explained that most of the entries of the notebook were got tallied from the books of account but some of the entries could not be tallied due to the change in the loading schedule. The explanation was not accepted. Against the assessment order, the dealer could not file any appeal. The assessing authority initiated the proceeding under Section 15A(1)(c) of the Act with the view that the enhanced turnover was concealed turnover. It appears that the dealer could not submit any reply in the penalty proceeding and the assessing authority levied a sum of Rs. 91,800 towards penalty under Section 15A(1)(c) of the Act taking the enhanced turnover at Rs. 3,05,877 as suppressed sales. Being aggrieved by the order, the dealer filed an appeal before the Deputy Commissioner (Appeals), which was dismissed. The dealer filed second appeal before the Tribunal. The Tribunal, by the impugned order, allowed the appeal of the dealer and the penalty was deleted.
4. Heard Sri B.K. Pandey, learned Standing Counsel and Sri K. Saxena, learned Counsel for the opposite party.
5. Learned Standing Counsel submitted that on the basis of the adverse material found at the time of survey dated June 6, 1993, the inference drawn by the assessing authority was justified and the Tribunal has erred in deleting the penalty.
6. Learned Counsel for the opposite party submitted that no specific concealment of turnover was found at the time of survey dated June 6, 1993. He submitted that with regard to the stock found at the time of survey dated June 6, 1993, the dealer had explained that they were for the testing purposes and mainly they were unfinished goods. With regard to the entries in exhibit 8 it was explained that it related to the loading and classification of a various shades maintained by the employee. He submitted that most of the entries of the exhibit 8 tallied with the books of account and some of the entries could not be tallied due to the change in the loading schedule. He submitted that the turnover has been enhanced on account of the rejection of the explanation and, therefore, penalty under Section 15A(1)(c) of the Act has rightly been deleted. In support of his contention, he relied upon the decisions of this Court in the case of Satya Confectionery Works v. Commissioner of Sales Tax reported in [1980] UPTC 356, Moti Lal Jawahar Lal v. Commissioner of Sales Tax reported in [2003] UPTC 854.
7. Having heard learned Counsel for the parties. I have perused the order of the Tribunal and authorities below.
8. I do not find any substance in the argument of learned Standing Counsel.
9. In the case of Satya Confectionery Works v. Commissioner of Sales Tax reported in [1980] UPTC 356, Moti Lal Jawahar Lal v. Commissioner of Sales Tax reported in [2003] UPTC 854, it has been held that merely because the turnover has been enhanced by rejecting the explanation of the dealer in respect of the documents found at the time of survey, it cannot be inferred that the turnover has been concealed in the absence of any specific material of concealment.
10. In the present case, perusal of the assessment order reveals that the adverse inference has been drawn after rejecting the explanation in respect of the stock found at the time of survey dated June 6, 1993 and exhibit 8, which was the notebook. The Tribunal, having regard to the entire facts and circumstances, held that the dealer had not concealed any turnover and accordingly, deleted the penalty. Learned Standing Counsel is not able to show anything to the contrary.
11. In view of the above, revision is devoid of merit and is accordingly, dismissed.