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1995 (4) TMI 261 - HC - VAT and Sales Tax
Issues:
1. Penalty under section 12(3) of the Act for non-filing of return. 2. Penalty under section 22(2) of the Act for collecting tax without registration. Issue 1: Penalty under section 12(3) of the Act for non-filing of return The case involved a partnership firm engaged in the business of color films production and distribution. The assessing officer levied penalties under section 12(3) and section 22(2) of the Act. The Appellate Tribunal deleted the penalty under section 22(2) but confirmed the penalty under section 12(3). The Tribunal held that there was no wilful failure to file the return as the tax had been collected by the Revenue authorities before the due date. However, the High Court disagreed with the Tribunal's decision. The Court observed that the penalty under section 12(5) is exigible if the assessee fails to file a return, irrespective of wilfulness. The Court re-fixed the penalty at 100% of the tax payable, considering the single transaction nature of the business. Issue 2: Penalty under section 22(2) of the Act for collecting tax without registration Regarding the penalty under section 22(2) for collecting tax without registration, the Court analyzed the timeline of events. The firm collected tax on August 4, 1981, without being a registered dealer. The application for registration was submitted on October 29, 1981, beyond the 30-day limit from the commencement of business. The Court noted that the non-issuance of the registration certificate within 30 days from the application date amounted to rejection. Therefore, the tax collected without proper registration was deemed illegal. The Court re-fixed the penalty at 100% of the tax payable by the assessee, considering the specific circumstances of the case. In conclusion, the High Court allowed the petition, setting aside the Tribunal's decision on penalties under section 12(3) and section 22(2) of the Act. The Court re-fixed the penalties at 100% of the tax payable by the assessee, emphasizing compliance with registration requirements and timely filing of returns to avoid penalties.
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