JUDGMENT V.K. Mehrotra, J.
1. This revision has come before us on a reference made by one of us who felt dubitant about the correctness of the observation made by him in an earlier decision in Bhagwan Das Mool Chand v. Commissioner of Sales Tax, U. P. 1980 ATJ 434.
2. The assessee, who is the applicant in this Court, was dealing in foodgrains and oil-seeds. The matter relates to the year 1977-78 during which there were several surveys at its business premises. One of such surveys was made on 27th October, 1977, at about 5.00 or 5.30 in the evening. Some loose papers were found during the survey at the shop containing mention therein of arrivals of foodgrains, etc. On scrutiny of the account books it was found that the transactions recorded in these loose papers were not incorporated in the books of account. The explanation given by the dealer was that the arrivals evidenced by these loose papers had taken place shortly before the survey and entries could not, therefore, be made about them in the books of account till after the survey. At the time of the assessment proceedings this explanation of the dealer was considered but the assessing authority found that it was not true. The dealer was not able to establish that the arrivals mentioned in the loose papers had taken place in the earlier part of the day. The assessing authority also found that some of the transactions were not entered in the books of account at all though entries had been made in respect of some of the transactions entered in the loose papers in the books of account. The assessing authority, therefore, rejected the books of account and determined the taxable turnover of the dealer by best of judgment. It made an addition in the taxable purchases of foodgrains and oilseeds to the extent of rupees twelve lakhs and two lakhs. It also made some addition in the taxable sale of oil-seeds.
3. The dealer failed to get the books of account accepted by the Assistant Commissioner (Judicial), Sales Tax, in appeal who, however, made some reduction in the taxable turnover. In a further appeal to the Sales Tax Tribunal also the dealer failed to secure acceptance of its accounts. The Tribunal, however, took the view that, in the circumstances noticed by it about the dealings of the applicant-dealer, the enhancement should be confined to rupees three lakhs and fifty thousand respectively.
4. In this Court the learned counsel for the dealer urged that the rejection of the books of account of the dealer only on the ground that the transactions found incorporated in the loose papers at the time of survey of the business premises on 27th October, 1977, had not been found entered in the account books at the time of survey was not enough to uphold the rejection of the accounts of the dealer, more so, when the entries about those transactions were actually made by the dealer in the books of account after the survey. In support of the plea, reliance was placed, inter alia, on a decision of one of us (R. M. Sahai, J.) in the case of Bhagwan Das Mool Chand 1980 ATJ 434.
5. In Bhagwan Das Mool Chand's case 1980 ATJ 434 the view taken was that the mere fact that some transactions which had taken place on the date of survey had not been found incorporated in the account books when they were examined by the survey party, but they were subsequently so incorporated would not be a sufficient ground in law to reject the books of account. Reliance for the view was placed on an earlier Division Bench judgment of the Court in Bishambar Singh v. Commissioner of Sales Tax Reversed by the Supreme Court in 1972 UPTC 742. Since the observations in the case of Bhagwan Das Mool Chand 1980 ATJ 434 were felt to have been widely made and required reconsideration, the matter was directed to be placed before a larger Bench at his instance.
6. The question which often arises before the assessing authorities is whether books of account can be rejected on the mere ground that entries relating to some transactions, which had taken place during the day, were not found to be incorporated in the books of account when survey of the business premises of the dealer was made that very day. The question does not admit of any straight jacket answer. It has to be kept in mind that the purpose of survey generally is to check up the credibility of the accounts maintained by a dealer by finding out whether the transactions entered into by it were being correctly incorporated in the books of account. The fact that some transactions entered into by a dealer on the date on which survey was made were not found entered in its books of account at the time of survey must be considered in the context of the totality of circumstances and the inference drawn must necessarily depend upon the time when the survey was made and the time at which those transactions had taken place. Illustratively, we may mention that there might be a transaction, like arrival of goods in the business premises of the dealer at a time when the survey was in progress about which no entry is found. It is obvious that it could not be insisted in such a case that the entries about the transaction must contemporaneously be made. There is no provision in the U. P. Sales Tax Act or the Rules framed thereunder requiring contemporaneous entries of such transactions in the books of account. Likewise, where arrivals had taken place at about the commencement of business in the day and the survey is made soon thereafter it would be too much to expect the dealer to make an entry although the transactions were prior to the time of survey. These are only illustrative situations. On the contrary, in a case where a transaction found to have taken place early in the day and no mention about it was found till late in the day when the survey of the business premises was made, a legitimate inference could be drawn that the failure of the dealer to make the entry was deliberate with a view to suppress the transactions.
7. The question whether the books of account of a dealer could be discarded for absence of entries regarding transactions which have taken place earlier on the day of survey has arisen in this Court from time to time. In some of the reported decisions to which we shall make a reference presently, the inference that the books of account were unworthy of credence was upheld while in some the view taken was that the books of account could not have legitimately been rejected. The rule which, according to us, has generally been found running through these decisions and has normally been accepted by this Court in that eventuality it is a matter depending upon the circumstances of a particular case.
8. In Bishambar Singh v. Commissioner of Sales Tax 1972 UPTC 742, the Division Bench proceeded upon the view that the dealer was a kachcha arhatiya for whom it was not necessary to maintain a record of arrivals. On this view, the Bench concluded that the mere absence of entry of some transactions, which took place on 7th January, 1968, till 10th January, 1968, when entry was actually made, could not legitimately lead to the conclusion that the books of account were unworthy of acceptance. This case was taken in appeal to the Supreme Court Commissioner of Sales Tax, U. P. v. Bishamber Singh Layaq Ram [1981] 47 STC 80 (SC) by the Commissioner, Sales Tax. The Supreme Court took the view that on the facts of the case the dealer was actually a pucca arhatiya. As such, it was necessary for the dealer to have made entries about the arrival of goods at its business premises. On that basic premise the view taken by this Court was not accepted by the Supreme Court.
9. In Commissioner of Sales Tax v. Murli Dhar Shyam Saran 1976 UPTC 207, a Division Bench of this Court of which one of us was a member, observed that :
...The order of the Assistant Commissioner shows that the entry in respect of these two items were not made in the books of account at the time of survey. There is no finding that the assessee did not enter these transactions later. In fact, the assessee in His explanation before the Sales Tax Officer stated that the amount represented purchases made by the munim of the assessee, who had on a day earlier been advanced an amount of Rs. 1,000 and Rs. 10 for making purchases from Kanpur. In these circumstances and in the absence of any finding to this effect, it cannot be contended that no entries in respect of these transactions were made at all in the account books. The Judge (Revisions) Sales Tax, is the last fact-finding authority and it was open to him to accept the book version after considering the evidence....
10. It is clear from these observations that the Bench felt, in the circumstances of the case before it, that the acceptance of the explanation of the assessee could not be treated to be perverse or illogical.
11. In Tarang Radio Company v. Commissioner of Sales Tax 1980 ATJ 19, C. S. P. Singh, J., observed as under :
A survey was held on the premises of the assessee, and the Surveying Officer found that the three radio sets had not been entered in the wireless stock register. The wireless stock register of the assessee was not ready. The assessee's explanation was that the sets were not entered in the stock register as they were in an incomplete stage. The Sales Tax Officer took this fact into account...account books were rejected and an estimate of the turnover was made. The rejection of accounts has been upheld by the appellate authority as well as the revising authority although the estimated turnover has been reduced...the assessee's wireless stock register did not contain any entry regarding three radio sets. The explanation that they were not entered as they were not ready has not been accepted....The assessee should have entered these radio sets in the wireless stock register. The absence of entry in the relevant records indicated that the accounts of the assessee were not regularly maintained. The rejection of accounts were, therefore, justified.
12. In Indermal Triloki Pd. v. Commissioner of Sales Tax 1981 Tax Law Diary 1, one of us (V. K. Mehrotra, J.) took the view, on the facts of the case, that the absence of contemporaneous entries about the arrival of "gur" and "matar" in the satti bahi on the date of two surveys was not destructive of the dealer's case that there was no effort on its part to exclude these transactions from its books of account. The entries were made by the dealer in the books of account after the survey but on the dates of surveys themselves. Reliance had been placed on behalf of the Commissioner, Sales Tax, upon the provisions of the U. P. Krishi Utpadan Mandi Adhiniyam, 1964, and the Rules framed thereunder for the view that the entries should have been made contemporaneously. Learned counsel for the Commissioner failed to point out any specific provision in the Act or the Rules requiring such contemporaneous entries being made in the satti bahi.
13. In Krishna Brothers, Nainital v. Commissioner of Sales Tax 1982 UPTC 1159 a survey was made of the business premises of the dealer on 23rd March, 1977. Rokar was complete up to 22nd March, 1977, and the entries of the transaction up to 22nd March, 1977, were made. B. N. Sapru, J., who decided the case observed in paragraph 6 as follows :
No discrepancies in the account prior to 23rd March, 1977, was found and the fact that the assessee had not entered all the transactions on the date of the survey, namely, 23rd March, 1977, could not be a ground for rejecting the account as the transactions could have been entered till the close of that date's business.
14. A reading of the above observation may suggest as it was open to a dealer to make entries about transactions, which may have been entered into by him throughout the day, till the close of business that day so that the absence of entries about the transactions in the books of account at the time of survey during the day was not to be taken into account as a circumstances justifying the rejection of books of account. The report of the decision does not contain facts in sufficient details particularly with regard to the time when the survey was made nor has the learned Judge given reasons for the view taken by him. It is, however, clear that the observation cannot be construed to mean that in each and every case where survey is made of the business premises of a dealer at any time of the day, an absence of the record of the transactions made by the dealer that day in the books of account could not be taken to be a circumstance justifying the rejection of its books of account.
15. We have noticed the decisions, which were placed before us by the counsel for the parties, with a view to emphasise that it has not been laid down as a mattei" of law by this Court that where transactions entered in to by a dealer on the day on which his business premises are surveyed are not found incorporated in the books of account, the absence of such entries could not be taken into account, as a matter of law, for rejecting the accounts. The observations made by the learned Judges in the various decisions were in the context of the circumstances of each case and no inflexible rule of law has been laid down in this regard. In fact, it is not possible to lay down any inflexible rule in this regard for circumstances may be myriad in which the transactions may or may not be entered in the books of account of a dealer particularly of the day on which the survey is made. It has ultimately to be left to be decided by the appropriate authority, specified in the Act, whether absence of entries in the books of account has been properly explained by the dealer or not. In a particular case where the conclusion of the authority is found to be perverse in the sense that no reasonable person would have arrived at it, it would always be open to this Court to interfere in its revisional jurisdiction.
16. Coining to the facts of the present case, we find that the assessing authority has given cogent reasons for not accepting the explanation of the dealer about the absence of the entry relating to the transactions found incorporated in the loose papers found, till about 5-00 or 5-30 P. M., when the survey of business premises was made on 27th October, 1977. One of the reasons was that even the entries which were subsequently made did not contain the full record of transactions. It is difficult to accept the submission of the dealer's counsel that the rejection of the dealer's explanation was unjustified. In the matter of turnover as well, the Tribunal has given adequate relief to the dealer. In the circumstances noticed by it in its order, it cannot be said that the estimate of turnover ultimately made by the Tribunal is unreasonable or that it suffers from any manifest error which may induce this Court to interfere with it.
17. In conclusion, the revision fails and is dismissed. But, there shall be no order as to costs.