1997 (7) TMI 627 - HC - VAT and Sales Tax

Summary

Issues:
1. Refusal of Sales Tax Tribunal to refer questions of law to High Court under section 42(2) of the Haryana General Sales Tax Act, 1973.
2. Imposition of penalty on a courier company for alleged tax evasion.

Analysis:

Issue 1: Refusal to Refer Questions of Law
The petitioner filed a petition under section 42(2) of the Haryana General Sales Tax Act, 1973, seeking a mandamus to direct the Sales Tax Tribunal to refer three questions of law to the High Court for its opinion. These questions pertained to the imposition of penalties on the courier company for alleged tax evasion. The Tribunal declined to make the reference, stating that the first question did not arise from its order as the ownership of goods was not raised at any stage. The Tribunal also held that the other two questions were factual and not referable as questions of law. The High Court reviewed the Tribunal's orders and concurred that the first question did not arise from the Tribunal's order, as it was not raised before any authority. The second question, related to factual findings, was deemed not referable as a question of law. The High Court upheld the Tribunal's decision, dismissing the petition as without merit.

Issue 2: Imposition of Penalty
The petitioner, a courier company engaged in transporting goods, was intercepted by a Sales Tax Check Barrier officer while carrying goods. The officer found discrepancies in the goods being transported, leading to suspicions of tax evasion. The officer imposed a penalty under section 37(6) of the Act for an alleged attempt to evade tax. The petitioner appealed this decision before the Joint Excise and Taxation Commissioner and subsequently before the Sales Tax Tribunal. The Tribunal upheld the penalty, citing discrepancies in the goods' description and value as evidence of potential tax evasion. The Tribunal concluded that the maximum penalty imposed was justified based on the facts of the case. The High Court, upon review, found that the Tribunal's decision on the penalty was based on factual findings and upheld the imposition of the penalty. The High Court emphasized that the quantum of penalty is determined based on the facts of each case, and in this instance, the Tribunal's decision to levy the maximum penalty was within the limits prescribed by the Act. Consequently, the High Court dismissed the appeal, affirming the imposition of the penalty on the petitioner.

In conclusion, the High Court upheld the Sales Tax Tribunal's decision to refuse the reference of questions of law to the High Court and affirmed the imposition of the penalty on the courier company for alleged tax evasion based on the factual findings presented during the proceedings.