Books of account – Rejection without assigning reason – Not justified: U.P. Trade Tax Act, 1948

The petitioner dealer was a proprietary concern engaged in manufacturing and trade of rice and rice bran. A survey was conducted in the business premises of dealer on March 15, 2003. Neither the accountant nor the proprietor was available on the spot during the survey. The aged father of the proprietor was present who stated that the proprietor has gone outside. The books of account were produced later, but were rejected and assessment made on estimate basis. This was affirmed by the Tribunal.

On a revision petition, the High Court observed, that in the absence of the books of account at the time of survey, the stocks were not verified but the fact remained that, at a later stage, the books of account were produced by the dealer but were rejected without assigning any reason. There was no finding by the Tribunal that the dealer failed to show the cash book at the time of survey with mala fide intention. On the facts, the Tribunal was in error in affirming the rejection of the books only on the ground that the cash book could not be shown at the time of survey. The version of the dealer on the facts and circumstances of the case should have been accepted. The assessing officer directed to accept the books of account maintained by the dealer and make de novo assessment accordingly.