GULATI, J. - (1.) THIS is a reference under section 11(1) of the U.P. Sales Tax Act submitted by the Additional Judge (Revisions), Sales Tax, Agra, at the instance of the assessee and relates to the assessment year 1964-65. The connected reference relates to the assessment year 1965-66.
(2.) THE assessee carries on business in oil-seeds, foodgrains and gur in the trade name of M/s. Shyam Lal Om Prakash. It has two shops one at Dankaur, which is the head office, and the other at Gulaothi, which is the branch. On 7th December, 1965, a survey of the assessee's business premises at Gulaothi was carried out by the Sales Tax Officer, SIB (Special Investigation Branch). As a result of the survey 27 loose sheets of paper and one exercise book containing some transactions were discovered. The entries recorded on the loose sheets were found to have been entered in the account books. The exercise book contained entries from 18th November, 1965, to 6th December, 1965, i.e. for a period of one month and 17 days. The total of the credit entries amounted to Rs. 1.57,147 while the entries in the debit side totalled to Rs. 2,22,714. On verification it was found that transactions worth about Rs. 88,293.99 had not been recorded in the account books and the rest had been recorded. The assessee's explanation was that the exercise book did not contain any transactions of sale or purchase but was a private account for the transactions of loan and their repayment. This explanation of the assessee was not believed and the amount of Rs. 88,000 and odd was held to be suppressed turnover. In the circumstances, the Sales Tax Officer rejected the assessee's account books and made a best judgment assessment for both the years enhancing the turnover by Rs. 6,00,000 for the assessment year 1965-66 and Rs. 3,00,000 for the assessment year 1964-65. On appeal, the appellate authority confirmed the assessments except that it reduced the turnover of gur by Rs. 75,000 for the assessment year 1965-66 and by Rs. 40,000 for the assessment year 1964-65. The assessee then applied in revision in respect of both the years but remained unsuccessful. At the instance of the assessee, the revising authority has submitted this combined statement of the case relating to the two assessment years and has submitted for the opinion of this court the following questions of law : "(1) Whether the survey dated 7th December, 1965, can be held relevant for the year 1964-65 and whether a suppression could be presumed for that year on that basis ? (2) Whether the facts and circumstances of the case as held in revision corroborate the estimate of turnovers for the years 1964-65 and 1965-66 ?"
(3.) THE date of the survey, namely, 7th December, 1965, admittedly falls in the assessment year 1965-66. We are, however, of the opinion that it is not the date of the survey which is material for determining the question as to whether the result of such survey would be relevant for an earlier assessment year but what is material is the dates and the nature of the suppressed transactions which are discovered as a result of the survey. The exercise book which has been held to he a duplicate account book contains transactions relating to the period 18th November, 1965, to 6th December, 1965. This period falls within the assessment year 1965-66. There is no material or finding that any of the transactions recorded in the exercise book related to a period which would fall in the assessment year 1964-65 nor is there any finding or even a suggestion that any entry in the exercise book disclosed a balance carried over from an earlier year. There might be other circumstances which might suggest that the assessee might have practised suppression of turnover even in the earlier year. But no such circumstance has been indicated by the Judge (Revisions) in his revisional order giving rise to the present references. In the circumstances, it is not possible to hold that on the basis of the survey carried out on 7th December, 1965, any suppression of turnover during the year 1964-65 could be presumed. The Judge (Revisions) held the survey to be relevant for the assessment year 1964-65 on the view that "it cannot be believed that the applicant started making duplicate set of accounts only in the year 1965-66. There is some continuity of habits in business." This conclusion of the Judge (Revisions), in our opinion, is based on no material whatsoever and is a pure conjecture or a surmise. Even the best judgment assessment has to be supported by some material. The material may be direct or circumstantial but a mere suspicion or conjecture cannot take the place of evidence or material. We are, therefore, unable to uphold the finding of the Judge (Revisions) so far as the assessment year 1964-65 is concerned. On the facts and circumstances of the case the survey of 7th December, 1965, was not relevant for the assessment year 1964-65 and no suppression could be presumed for that year on the basis of the survey.;