IN THE HIGH COURT OF KERALA AT ERNAKULAM
ST Rev No. 220 of 2007()
1. A.T.ESSAKUNHI, PWD CONTRACTOR,
... Petitioner
Vs
1. THE STATE OF KERALA
... Respondent
For Petitioner :SRI.RAJESH NAMBIAR
For Respondent : No Appearance
The Hon'ble the Chief Justice MR.H.L.DATTU
The Hon'ble MR. Justice K.T.SANKARAN
Dated :02/07/2007
O R D E R
H.L. DATTU, C.J. & K.T. SANKARAN, J.
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S.T.Rev.No.220 of 2007
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Dated, this the 2nd day of July, 2007
ORDER
H.L. DATTU, CJ.
For the assessment year in 1992-93 the assessing authority had
quantified the tax liability of the assessee by passing an order of
assessment dated 30.8.1999. According to the assessee, at the time of
assessment he had produced the books of accounts maintained during the
regular course of business. Further, according to the assessee, after
going through the records, namely, the books of accounts, statement of
accounts etc., the assessing authority had prepared a check note.
2. The assessing authority had completed the assessments
accepting the returns filed by the assessee.
3. The revisional authority in exercise of its powers under section
35 of the Act had initiated suo motu revisional proceedings on the ground
that the assessing authority should not have completed the assessment
and should not have granted the exemptions claimed by the assessee in
the absence of books of accounts produced by the assessee.
4. The revisional authority thereafter had set aside the orders
passed by the assessing authority and had remanded the matter to the
assessing authority to re-do the matter in accordance with law. After such
remand, the assessing authority had passed an order dated 2.9.2003 and
S.T.Rev.No.220/2007 2
in that had proceeded to complete the best judgment assessment.
5. Aggrieved by the said order passed by the assessing authority
the assessee had carried the matter by way of first appeal before the
appellate authority and second appeal before the Tribunal. He was
unsuccessful before both the authorities. That is how the assessee is
before us in this revision petition.
6. The assessee has framed the following questions of law for our
consideration and decision. They are as under:
“I. Whether the order of the Sales tax Appellate Tribunal is
correct on law, facts and circumstances of the case?
II. The day book, ledger, statement of account and the
certificates from the awarders were admittedly produced by
the assessee at the time of the completing the original
assessment order. They were not returned to the
petitioner after completion of the proceedings. No
evidence is produced to show that the said records were
returned to the assessee. Burden is on the assessing
authority to prove by acknowledgment of the assessee that
the documents admittedly produced before the assessing
authority were in fact returned to the assessee after
completion of the original assessment proceedings. Thus
whether the best judgment assessment made solely for the
reason that book of accounts were not produced again
sustainable in law in absence of any evidence to show that
the book of accounts had in fact been returned to the
assessee after completion of the original assessment
proceedings?
III. Has the tribunal erred in law in not directing the
S.T.Rev.No.220/2007 3
assessing authority to verify the check notes prepared on
the basis of the book of accounts produced at the time of
completion of the original assessment and to re do the
assessment on the basis of the entries therein?
IV. The Deputy Commission had set aside the Annexure A
assessment on the ground that the assessment completed
is irregular and without proper enquiry. The deductions
allowed by the assessing authority were found to be
irregular by the Deputy Commissioner. In Annexure B
order itself it is stated that “the assessment completed
under Section 5(1)(iv) by the assessing authority is
irregular as the contractor himself has stated that he has
not maintained proper book of accounts for the above
years and as such the book of accounts produced appears
to be incorrect and incomplete”. Thus the Deputy
Commissioner in Annexure B order had only expressed an
opinion and not rendered any specific finding that the book
of accounts produced are incorrect as wrongly interpreted
by the tribunal. Therefore has not the Tribunal erred on
facts and on law in stating that since there is a specific
finding by the Deputy Commissioner that the accounts
produced before the assessing authority are incorrect and
incomplete and therefore a direction to re-do the
assessment on the basis of the check notes prepared
cannot be allowed?
7. Learned counsel appearing for the assessee would contend that
at the time of quantification of the tax liability for the first time by the
assessing authority he had produced all the books maintained by him in
S.T.Rev.No.220/2007 4
the regular course of business. Therefore, the assessing authority by its
subsequent order dated 2.9.2003 should not have observed in its order
that the assessee had failed to produce the books of accounts. It is further
contended by the learned counsel for the appellant that with the help of the
cheque slips that were available, the assessing authority should have
completed the assessment and should have granted certain benefits
claimed by the assessee in his annual returns.
8. The assessing authority, the first appellate authority and the
Tribunal have come to the conclusion that for the assessment year in
question the assessee had not produced any books of accounts before the
assessing authority. Whatever that was produced was also defective and
the books of accounts were returned to the assessee.
9. In fact, even before the assessing authority and the revisional
authority, the assessee had stated that he had not maintained proper
books of accounts with respect to the assessment year in question.
10. In our opinion, since the assessee did not produce the books of
accounts maintained by him during the regular course of business, the
assessing authority had no other alternative but to proceed and complete
the best judgment assessment. The order so passed is confirmed by the
first appellate authority as well as by the Tribunal. We do not see any
error in those orders. Therefore, interference of those orders is not called
for in this revision petition. Accordingly, this revision petition is rejected
and the questions of law framed by the assessee is answered in the
S.T.Rev.No.220/2007 5
negative and in favour of the revenue. Ordered accordingly.
H.L. DATTU,
CHIEF JUSTICE.
K.T. SANKARAN,
JUDGE.
mt/