T. Ramaprasada Rao, C.J.
1. In the exercise of its powers as the statutory authority under the Tamil Nadu General Sales Tax Act, 1959, the assessing authority was not satisfied with the returns furnished by the assessee-respondent and had to assess the taxable turnover on the basis of best judgment. This resulted in the assessing officer assessing the respondent to a taxable turnover of Rs. 7,19,237.11. The Deputy Commissioner of Commercial Taxes in suo motu revision, while accepting the exercise of the best judgment assessment of the assessing authority, thought that this was a fit case in which penalty ought to have been levied under Section 12(3) of the Act. Therefore, in exercise of such power supposed to have been vested in him and on the supposition that there was 'wilful suppression' of sales turnover, inflicted a penalty of Rs. 2,061 being the equivalent of the tax due on the 'suppressed turnover' of Rs. 58,901.75 for such wilful non-disclosure. It may be stated at once that the expression 'suppressed turnover' used by the Deputy Commissioner is relatable to the difference between the turnover reported by the assessee as per his books and the turnover determined by the assessing officer in the exercise of his best judgment method. The assessee took up the matter in appeal before the Appellate Tribunal, Additional Bench, Madurai, who would not sustain the order of penalty as levied by the Deputy Commissioner and allowed the appeal.
2. It is clear from the facts recited that the assessment was the product of the best judgment method. Though terminologically the State calls it the best judgment, one is not sure whether it is. It is the judgment of the assessing authority on a scrutiny of the books of account of the assessee and taking into consideration the surrounding circumstances. Unless there is a finding by the assessing authority that there has been a wilful suppression, which springs from the contumacious conduct on the part of the assessee, which is discernible from the course of his conduct as a businessman, it would not be safe to assume that, by reason of the best judgment assessment and by reason of the increase in the assessable turnover as discovered by the assessing officer, there is an automatic conclusion about the suppression and that too wilful suppression of assessable turnover by the assessee. Each case has to be decided on its own merits. In the instant case, it is not stated that there was such a finding which would provoke a reasonable assessing authority, while exercising suo motu powers of revision to assume that there was such a wilful suppression of sales turnover on the part of the assessee. The Deputy Commissioner, no doubt, had the right to look into the records and scrutinise the order of the statutory functionary in the lower hierarchy, so as to correct it, if such a correction was necessary. But it is very doubtful whether he could assume that in every case where the best judgment method is adopted as a result of which there is an increase in the assessable turnover as discovered by the assessing authority that there has been a wilful suppression of sales turnover. Levy of penalty springs from the act which amounts to misconduct and being penal in nature ought not to be the product of any assumption. The Deputy Commissioner in the exercise of his revisional power thought that he could fix the penalty at Rs. 2,061, once again on the supposition that there was wilful suppression. There was no such direct or telling finding by the assessing authority. It is not even contended to be so before us. It was in those circumstances that the Tribunal, in the appeal filed by the aggrieved assessee for cancellation of the penalty levied by the Deputy Commissioner, who did so in exercise of his revisional authority, cancelled the penalty. The Tribunal would say that the Deputy Commissioner exceeded his limits of revisional jurisdiction, when, as revisional authority, he was only reviewing the order of assessment made by the original authority and that, in the circumstances, he exceeded the power to impose penalty, as if he was the original authority. It was in that light that the Tribunal corrected the order of the Deputy Commissioner. As ultimately we are satisfied that this is not a case in which it could be reasonably said that there was a wilful suppression of taxable turnover, we are not inclined to interfere. The tax case is accordingly dismissed.