JUDGMENT
H.L. Agrawal, C.J. and S.C. Mohapatra, J.
1. This is a reference under Section 24(1) of the Orissa Sales Tax Act.
2. The dealer carries on the business of sale and purchase in wheat and wheat products. In respect of the assessment year 1969-70, the dealer was assessed under Section 12(4) of the Act to the best of judgment of the assessing officer which was confirmed in appeal. In second appeal before the Tribunal, however, the basis of enhancement was not accepted’ and the Tribunal annulled the enhancement. Aggrieved by the same, the petitioner filed an application for reference on the question of law to this Court for decision and accordingly, the Tribunal has submitted the statement of the case on the following question :
Whether on the facts and in the circumstances of the case, the Tribunal is legally correct to hold that the books of accounts maintained by the assessee on Diwali year basis should not have been rejected for the suppressions found on 14th April, 1970, 15th April, 1970 and 16th April, 1970, and as such, the enhancement made for the assessment year 1969-70 has correctly been annulled ?
3. As revealed from the facts stated, a slip was detected in which there were five items dated 14th April, 1970, 16th April, 1970, 16th April, 1970 and 19th April, 1970, which were not reflected in the books of accounts of the dealer which is maintained on the Diwali year basis. As the account books did not reflect the figures on the dates as found from the slip, the assessing officer held that the accounts are to be rejected and accordingly treating the amounts to be suppressions, enhanced the turnover for the year. On consideration of the materials, the Tribunal held that the dates in the slip relate to the year 1970-71 and as such cannot be the basis for enhancement of turnover for the previous year which is the year for assessment for enhancement.
4. There cannot be any dispute that even if the assessment is to the best of judgment, there must be some nexus for the same. The short question is whether the suppression for a subsequent period which was available at the time of making the assessment would have a reasonable nexus to the assessment?
The answer is simple. The suppression is for the subsequent year. A future action cannot be a nexus for best judgment assessment of the previous period. Accordingly, the Tribunal was justified in finding that the assessing authority cannot place reliance on the slip which is subsequent to the period of assessment.
5. In the result, on the facts and in the circumstances of the case, the Tribunal is legally correct to hold that the books of accounts maintained by the assessee on the Diwali year basis should not have been rejected for suppressions found on 14th April, 1970, 15th April, 1970 and 16th April, 1970 and as such the enhancement made for the assessment year 1969-70 has correctly been annulled.
6. The reference is answered in favour of the assessee. No costs.