1. This revision petition by the assessee under section 23 of the Sales Tax Act, 1957, is directed against the order dated 25th March, 1981, of the Karnataka Appellate Tribunal, made in S.T.A. No. 954 of 1980 in Appeal No. 101 of 1980-81, on the file of the Deputy Commissioner of Commercial Taxes (Appeals), Bangalore Division, Bangalore. The Deputy Commissioner of Commercial Taxes, in turn, affirmed the order of assessment dated 20th June, 1980, made by the Commercial Tax Officer, I Circle, Davangere, for the assessment period commencing from 1st April, 1978 to 31st March, 1979.
2. The assessee, M/s. Andanur Kotrabasappa & Bros. is a trader in Davangere. As the assessee did not comply with the statutory obligations of filing of the returns for the relevant assessment periods a proposition-notice dated 11th June, 1979, pointing out the non-compliance by the assessee in response to the earlier notice served on 10th May, 1979, and proposing to levy sales tax on the assessee on a turnover of Rs. 1,00,000 was caused to be issued by the assessing authority. In response to this notice, the assessee by its letter dated 29th June, 1979, stated that there was a marriage in the family of the partners on 4th July, 1979, and requested for a month's time to produce its accounts. The assessing authority granted the time prayed for. But for nearly none months thereafter, the assessee did not bestir itself to produce the books of account. The assessing authority could very well have proceeded to finalise the assessment ex parte. Instead another notice dated 26th March, 1980 - served on the assessee on 3rd April, 1980 - was issued notifying the assessee that if it did not cause production of the books of account within three days from the date of service of the notice, the assessment would be finalised on the basis of the proposition-notice dated 11th June, 1979. Even this notice not having evoked the desired response, the assessing authority on 20th June, 1980, concluded the assessment on the basis of the proposition-notice. Its appeals before the Deputy Commissioner of Commercial Taxes and the Karnataka Appellate Tribunal having been unsuccessful, the assessee has now come up in revision.
3. Sri B. K. Manjunath, the learned counsel for the petitioner, raised three points :
(i) Assessment to sales tax made in the case on a taxable turnover of Rs. 1,00,000, as against the assessed taxable turnover of Rs. 3,800 for the previous year, is an antithesis of a best judgment assessment and is wholly arbitrary.
(ii) That the entirety of the assumed gross turnover is treated as taxable turnover which is wholly unreasonable and arbitrary.
(iii) That on 3rd April, 1980, the partner of the assesses-firm did appear before the assessing authority and the matter had to be adjourned on that day on account of the assessing authority proceeding on leave and that the partner was given to understand that fresh notices would be issued in this behalf. The assessment finalised without such further notice is at once importer, unfair and stands vitiated.
4. We see no merit in any one of these contentions.
It is no doubt true, as contended by the learned counsel, that a best judgment assessment should not be arbitrary but must have some basis. Sri Manjunath says that for the months of May to December, 1978, which constituted a substantial part of the assessment period, the assessee had filed form No. 3 for each month and that the figures set out therein ought to have been a proper guide for the best judgment assessment. It is seen from form No. 3, found in the records made available by the learned High Court Government Pleader at the hearing, the turnover disclosed is in the neighborhood of Rs. 69,000, yielding an average of approximately Rs. 7,900 per month. Reckoning for 12 months on that basis would yield a figure near about the one assumed by the assessing authority. We do not think that the figures in the best judgment assessment are really arbitrary so as to render it infirm in law. In the light of these facts, the circumstance that the assessing authority did not rest the best judgment assessment on the previous year's taxable turnover would not vitiate the assessment. This is so far as the first point is concerned.
5. The second point is that even assuming that Rs. 1,00,000 was permissible to be assessed as the gross turnover, the whole of it ought not to have been reckoned as taxable turnover. The bulk of the turnover, says Sri Manjunath, represented dealings as a second dealer. On this aspect the burden was on the assessee to substantiate that claim having regard to the provisions of section 6-A of the Act. The burden of proof that any transaction of turnover was not liable to tax was on the assessee. Since the assessee made no attempt in this regard either before the assessing authority or before the appellate authorities, the assumption of the entire turnover as taxable was a logical finale of the omission on the part of the assessee to discharge the burden under section 6-A.
6. So far as the third point that the on 3rd April, 1980, the partner of the assesses-firm did, in fact, appear before the Commercial Tax officer and that there was an assurance from the latter that a fresh notice would be issued is concerned, the learned counsel did not, in our opinion, wisely press this contention, after looking into the ground No. 3 urged by the assessee before the first appellate authority.
7. There is thus no merit in the petition. It is accordingly rejected at the admission stage.
Smt. M. R. Vanaja, High Court Government Pleader, is permitted to file memo of appearance, if it is not already filed within two weeks from today.
8. Petition dismissed.