SREE KRISHNA ELECTRICALS versus STATE OF TAMIL NADU & ANR.

Citation: [2009] 6 S.C.R. 809 · Decided: 21-04-2009 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Disposed off

Judgment (excerpt)

[2009] 6 S.C.R. 809 
SREE KRISHNA ELECTRICALS 
A 
V. 
STATE OF TAMIL NADU & ANR. 
(Civil Appeal Nos. 5134-5135 of 2002) 
APRIL 21, 2009 
.B 
[DR. ARIJIT PASAYAT AND LOKESHWAR SINGH 
·'r 
PANTA, JJ.] 
Tamil Nadu General Sales Tax Act, 1959 - Sale of wet 
. grinders - Levy of sales tax and imposition of penalty -
c 
Assessee's claim that only parts of wet grinders sold and not 
wet grinders - Order of assessing authorities and High Court 
that a complete wet grinder was sold which was a new 
commodity and not merely parts thereof - Interference with -
Held: Not called for as regards levy of tax - As regards levy D 
.. 
of penalty, certain items not included in the turnover were 
disclosed in dealer's own accounts book and assessing 
authorities included the items in dealer's turnover and 
disallowed exemption, thus, penalty cannot be imposed -
Levy of penalty set aside. 
E 
State of Tamil Nadu v. Suguna Agencies 1991 (81) STC 
33; S. Durai v. Joint Commissioner of Commercial Taxes 
Chepauk, Madras (1994) 95 STC 372, referred to. 
Case Law Reference: 
F 
1991 (81) STC 33 
Relied on 
Para 1 
1994 (95) STC 372 
Relied on 
Para 1 
CIVIL APPELLATE JURISDICATION : Civil Appeal Nos. 
"*' 
1 
5134-5135 of 2002. 
G 
From the Judgment & Order dated 12.09.2001 of the High 
Court of Judicature at Madras in Writ Petition Nos. 6722 to 
6723 Of 1999. I 
809 
H 
810 
SUPREME COURT REPORTS 
[2009} 6 S.C.R. 
A 
S. Balaji, N.C. Mohan, Madhusmita Bore and K.V. 
Vijayakumar for the Appellant(s). 
R. Nedumaran for the Respondent(s). 
The Judgment of the Court was delivered by 
B 
DR. ARIJIT PASAYAT, J. 1. Challenge in this appeal is 
to the judgment of a Division Bench of the Madras High Court 
dismissing the writ petitions filed by the appellant. The appellant 
is a dealer registered under the Tamilnadu General Sales Tax 
Act, 1959 (in short the 'Act'). The appellant was assessed to 
C tax on the sale of wet grinders. Though the appellant claimed 
that he was not selling wet grinder but only parts thereon, the 
claim was found to be untrue and tax and penalty were imposed 
for the Assessment years 1992-93 and 1993-94. Appellant's 
stand was that he was entitled to relief on the basis of a 
D judgment of the High Court in State of Tamil Nadu v. Suguna 
Agencies (1991) 81 SCC 33). According to the Revenue 
authorities, the judgment was referred to in a later judgment of 
the High Court in S. Durai v. Joint Commissioner of 
Commercial Taxes Chepauk, Madras (1994) 95 STC 372 
E wtiere a different view was taken. 
2. Both these cases are cases in which similar claims were 
made that though the assessee had purchased parts required 
to be put together to form wet grinder whatsoever has been sold 
by the assessee was not wet grinder but parts thereof. In the 
F first case the High Court accepted the finding of the Tribunal 
that what had been sold was the parts of the wet grinder. In the 
later case the High Court found that the authorities had 
recorded a finding that what was sold was in fact was a 
complete wet grinder which was a new commodity and not 
G merely parts thereof. 
3. The High Court was of the view in the present case that 
the later decision apply to the facts of the present case. As 
regards the penalty the assessee took the stand that the 
H penalty has been imposed mechanically and there was no 
...
SREE KRISHNA ELECTRICALS v. STATE OF TAMIL 811 
NADU & ANR. [DR. ARIJIT PASAYAT, J.] 
• 
warrant for it as the assessee had disclosed the turnover for A 
.. _ 
which he had claimed exemption. The High Court was of view 
that there was not complete disclosure and the fact that he had 
disclosed the sale of what he has termed as parts does not 
amount to full disclosure. The assessments made in the case 
of the assessee were in fact the best judgment assessment 
B 
which permitted the imposition of penalty. Accordingly the writ 
petitions were dismissed. 
4. Learned counsel for the appellant submitted that the 
High Court should have compared the factual scenario and 
should have held that the decision in Suguna's case (supra) is c 
applicable to the facts of the case. 
5. Learned counsel for the respondent on the other hand 
supported the judgment of the High Court. 
6. We find that the authorities have factually adjudicated 
D 
the issues. In S. Durai's case (supra) on which reliance was 
placed by the High Court to dismiss the writ petitions is held 
that what was sold was in fact a complete wet grinder which 
was a new commodity 

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