1996 (5) TMI 403 - HC - VAT and Sales Tax

Summary

Issues:
1. Application under section 22(2)(b) of the Punjab General Sales Tax Act, 1948 for direction to the Sales Tax Tribunal to state the case and refer certain questions of law.
2. Imposition of penalty under section 9(2) of the Central Sales Tax Act read with section 10(7) of the Punjab Act based on revised return filed by the assessee.
3. Appeal against penalty imposition, reduction of penalty by the Tribunal, and application for reference of questions of law under section 22(1) of the Punjab Act.

Analysis:

1. The petitioner-assessee filed an application seeking a direction to the Sales Tax Tribunal to refer certain questions of law arising from the Tribunal's order. The assessee, a dealer under the Central Sales Tax Act, filed a revised return showing increased taxable inter-State sales. The Assessing Authority suspected the revised return was not filed bona fide, leading to the imposition of a penalty of Rs. 75,000. The Tribunal upheld the penalty but reduced it to Rs. 60,000. The assessee's application for reference of questions of law was declined. The issue raised was whether the Tribunal correctly concluded that the revised return was not filed accidentally and honestly, warranting the penalty.

2. The Tribunal found that the assessee did not include certain sales in the original or subsequent quarters, leading to suspicion. The Tribunal concluded that the revised return was not filed due to accidental or honest errors, as required by section 10(5) of the Punjab Act. The Tribunal's factual finding was that there was no accidental or honest omission, justifying the penalty imposed. The counsel for the assessee argued that the penalty should be based on the revised return's correctness rather than the original return. This raised the question of whether the penalty under section 10(7) of the Punjab Act should be imposed based on the original or revised return, which required legal interpretation.

3. The legal argument centered on whether the word "return" in section 10(7) of the Punjab Act referred to the original or revised return when imposing a penalty for filing a false or incorrect return. The Court directed the Tribunal to refer the question of law to determine if the assessing authority should consider the original return or the revised return, where applicable, for imposing penalties under section 10(7) of the Punjab Act. This issue required clarification to ensure consistency in penalty imposition based on the correct interpretation of the statute.