The provisions of Sec.18 (1) of the Bihar Sales Tax Act, 1959, include the power to assess the escaped turnover to the best of judgment.

U. N. Sinha, J.

1. This reference has been made under Sec.33 (1) of the Bihar Sales Tax Act, 1959, by the Commercial Taxes Tribunal, Bihar, Patna, at the instance of a dealer named Messrs Mittal and Company at Patna. The two questions of law arising out of an order passed by the Tribunal on the 18th December, 1965, in Revision Case No. T/50 of 1965, in the matter of an assessment of sales tax for the period 1962-63, have been framed as follows :-

(1) Whether the remand assessment order under Sec.18 (1) read with Sec.16 of the Bihar Sales Tax Act, 1959, after the order passed by the Deputy Commissioner of Commercial Taxes on 30th May, 1964, in respect of the year 1962-63 is legally valid ?

(2) Whether the provisions of Sec.18 (1) of the Act include power to assess the escaped turnover to the best of judgment ?

2. During the relevant period, Messrs Mittal and Co. was a dealer in glass bangles. By an assessment order dated the 4th July, 1963, the dealer was assessed to sales tax for the assessment year 1962-63, by which the dealers general turnover was increased by the assessing authority by a sum of Rs.29,455. The dealer had, in due course, appealed against this order and it appears that during the pendency of the appeal, there was a surprise inspection of the business premises of the dealer on the 30th September, 1963. Five books of account were seized for the purpose of detailed verification and on verification, the assessing authority came to the conclusion that two of these books contained clandestine transactions, resulting in tax evasion for the same assessment year and as assessment had already been completed, the assessing authority came to the conclusion that reasonable grounds existed for believing that the turnover for the assessment year 1962-63 had escaped assessment. A proceeding under Sec.18 (1) was commenced and the dealer was noticed. An objection was raised by the dealer on the ground that the notice issued under Sec.18 (1) was illegal and that the seized books did not contain any material in respect of the period 1962-63. The objection was overruled by the assessing authority by an order passed on the 29th November, 1963. The dealer was ordered to produce its complete account books for the year 1962-63 for examination. Being dissatisfied with this order the dealer went up in revision and the revision was dismissed on the 16th January, 1964, by the Appellate Assistant Commissioner. Thereafter, on the 30th May, 1964, the appeal from the original assessment order was disposed of by the Deputy Commissioner of Commercial Taxes. The relevant portion of this order runs as follows :-

I have perused the order passed by the Sales Tax Officer. The order recorded by the Sales Tax Officer does not show that there was any specific evidence of suppression of the turnover. The Sales Tax Officer has pointed out some delay in the posting of some entries but this delay cannot be taken to be any good piece of indication of any suppression of turnover. The Sales Tax Officer also seems to have suspected that the assessee might have maintained some fabricated or cooked up cash memos. But this suspicion does not seem to be well supported by any satisfactory evidence. In the circumstances I direct that the assessees book figures should be accepted for the purpose of assessment. The order of assessment should be modified accordingly. In due course, a fresh assessment order was passed by the assessing authority. The assessing authority enhanced the gross turnover as revealed by the books of account by 150 per cent. After making certain deductions the total tax payable and the penalty were calculated. The dealer appealed against this assessment order and the appellate authority dismissed the appeal, with slight modifications. The book figures were enhanced by 100 per cent. instead of 150 per cent. , as was done by the assessing authority. Thereafter the dealer went up to the Tribunal in revision and by order dated the 18th Decemb