T. Ramaprasada Rao, J.
Tax Case No. 402 of 1969
1. The assessee started business in groundnut and groundnut kernel in the assessment year 1962-63. For the first assessment year, he returned a turnover of Rs. 78,232.23. There were two surprise inspections made by the departmental officers on 14th September, 1962 and 27th November, 1962, which disclosed heavy suppressions to the tune of Rs. 27,235.00 and Rs. 15,578.75 on 14th September, 1962 and Rs. 19,950.00 on 27th November, 1962. Though the dealer produced his accounts, they were rejected by the Revenue and ultimately in second appeal by the Tribunal as well, who maintained the best judgment assessment made by the assessing authority as also the levy of penalty for such suppression. Mr. Padmanabhan, learned Counsel for the petitioner, reiterates his contentions urged before the Tribunal and says that the mere fact that suppression was discovered on two occasions of inspection cannot legitimately lead to the inference that a best judgment assessment could be made and if at all it could be made, an estimate of three times over the returned turnover is, according to him, unsupportable. The best judgment method of assessment involves a certain amount of a legitimate guess though tampered with judicial mercy and such guess is ordinarily dependent upon the facts and circumstances of the case and particularly the conduct of the assessee in the course of his business. Though it is essentially subjective in nature, yet it has some objective features as well and it is such objective material which prescribes varied and variegated standards for the ultimate assessment of the turnover on a hypothetical basis. In the instant case, the assessee started his mill for the first time during the assessment year, but even then he thought of evasion, suppression and avoidance. It is not on one occasion, which could be ordinarily viewed as a result of an accident. But on two surprise inspections such suppression was discovered. This is, therefore, reflective of the cause conduct of the new dealer who entered into the field of merchandise and who has not had an honest intention about his trade and taxation. It was this which no doubt compelled the assessing authorities to resort to best judgment and while resorting to best judgment, they had to necessarily estimate the turnover. As the Tribunal points out, there was attempted huge suppression of the turnover by the assessee and it was not satisfactorily explained that such suppressions were properly reflected in the regular accounts kept by the assessee. The assesse wanted to explain and on the face of it the explanation was spurious. Such suppressions were found in a pocket note-book recovered during inspection and the assessee gullibly explains away the pocket note-book as one relating to another person and not his. He did not take any steps to substantiate his statement that the pocket note-book did not belong to him but related to the business of another. Taking the conduct of the assessee as a whole, the Tribunal thought that there was not occasion for it to interfere with the estimate made by the Revenue. There is therefore no question of law arising from the order of the Tribunal. We are not satisfied that the conclusions resulting in the findings of fact by the Tribunal are without any basis whatsoever. The Tax Case is rejected.
Tax Case No. 403 of 1969.
The same assessee is concerned in this Tax Case, and the year of assessment is 1963-64. In this case also the best judgment assessment was made by the Revenue and the Tribunal considerably reduced the quantum by adopting another yardstick of estimation. This, again, is a case where the account books of the assessee were rejected because on the date when the mills were inspected, there was a suppression of over one lakh of rupees on one single day. The Revenue rightly, therefore, assessed the assessee in, its best Judgment. They, however, estimated the the turnover and added 50 per cent to the book turnover, as returned by the assessee. The Tribunal reduced it and added only 25 per cent of the same and thus brought the totality as the, assessable turnover. No question of law arises and in addition the finding of fact is justified. The Tax Case is dismissed.