JUDGMENT OM PRAKASH, C.J. – The short question arising in this tax revision case for consideration is whether the assessing officer was right in resorting to the average running stock method in the jewellery account. This revision relates to the assessment year 1986-87. The assessee - a dealer in textile and jewellery items - disclosed turnover of both the items. The assessing authority noticing certain defects rejected the book version of the assessee and resorting to the average running stock method, made an addition to the extent of four times the average running stock in the jewellery account, which was reduced by the appellate authority to two times of the average running stock and that has been affirmed by the Tribunal. The assessee's business premises was inspected by the intelligence wing on June 30, 1986 and then it was discovered that purchases and sales were not regularly accounted for in the books. At the time of inspection, the intelligence officer found a difference of 4.200 grams worth Rs. 996.60. From this, the assessing officer inferred as follows : "This clearly revealed that he has unaccounted purchase of gold in large scale and in order to accommodate the unaccounted purchase he has unaccounted sales also. The total suppression on the inspection estimated to Rs. 3,601.66." 2. The submission of learned counsel for the assessee before us is that the difference in gold ornaments was very insignificant, that is, to the extent of only 4.200 grams and, therefore, the average running stock method could not have been resorted to by the assessing officer. It is true that no pattern of suppression has been pointed out in this case. The question for consideration is that when there is no pattern of suppression and when the difference in the stock is only to the extent of 4.200 grams whether the assessing officer was right in resorting to the average running stock method. 3. In C. Kunhikannan v. State of Kerala 1996 KLJ (Tax Cases) 97, a Division Bench of this Court hold as under : "... The estimation necessarily depends upon the facts of each case. The running stock method, though permitted cannot be applied as a flat rule of thumb in each and every case of rejection of accounts and estimation of turnover. The estimate must be related to the facts of the case. The estimation necessarily depends upon the facts of each case. The running stock method, though permitted cannot be applied as a flat rule of thumb in each and every case of rejection of accounts and estimation of turnover. The estimate must be related to the facts of the case. There is nothing stated in the orders of the authorities below as to why the average running stock method is the proper mode of estimating the turnover in these cases excepting that the petitioner's shop is situated in an important centre in Thaliparamba. But that itself will not justify die adoption of this method in the absence of any other material." The application of the average running stock method, resulted into the addition of more than Rs. 1 lakh. 4. We are of the considered view that on the facts and in the circumstances of the case, this case requires reconsideration. Before resorting to the average running stock method the assessing authority must have stated cogent reasons to resort to that method which resulted into the addition of more than Rs. 1 lakh. Applying the aforesaid authority, it must be held that resorting to the average running stock method is not the universal rule and the application thereof will depend upon the facts and circumstances of each case. That being so, it was the duty of the assessing authority to state the reasons to resort to the average running stock method, application of which has given rise to the huge addition. No such reasons have been given either by the assessing authority or by the appellate authority, who affirmed the application of the average running stock method. In the result, the T. R. C. succeeds and is allowed. The Tribunal's order dated March 6, 1992 is set aside and the case is remitted to the Tribunal with the direction that the Tribunal if it wants to affirm the order of the assessing officer, will state the reasons as to whether on the facts and circumstances of the case the average running stock method could be applied. Petition allowed.