2007 (7) TMI 590 - AT - VAT and Sales Tax

Summary

Issues:
1. Challenge to penalty order under section 77 of West Bengal Value Added Tax Act, 2003.
2. Reduction of penalty by Assistant Commissioner of Sales Tax, Siliguri Range.
3. Confirmation of penalty order by Deputy Commissioner of Sales Tax, Siliguri Range.

Analysis:

1. Challenge to Penalty Order:
The petitioner challenged the penalty order under section 77 of the West Bengal Value Added Tax Act, 2003, imposed by the S.T.O., Siliguri Range. The petitioner argued that there was no violation of section 81 of the VAT Act, 2003, as the necessary documents for an inter-State sale were produced during the interception. The petitioner contended that the production of a tax invoice was not mandatory, as an invoice was produced along with seven other documents. The State Representative, however, highlighted discrepancies, such as the absence of the petitioner's VAT number on the invoice and the consignor and consignee having the same address on the consignment note.

2. Reduction of Penalty:
The Assistant Commissioner of Sales Tax, Siliguri Range, reduced the penalty amount from Rs. 3,57,042 to Rs. 2,14,225.20. The petitioner argued that the seizure and penalty were unlawful and should be quashed. The State Representative emphasized the requirement under section 81 of the VAT Act, 2003, for the production of a tax invoice with the VAT number. The State Representative urged for the dismissal of the petition based on these grounds.

3. Confirmation of Penalty Order:
The Deputy Commissioner of Sales Tax, Siliguri Range, confirmed the penalty order passed by the Assistant Commissioner. However, upon detailed examination of the documents produced by the petitioner, the Tribunal found that the grounds cited for the penalty were not valid in the present case. The Tribunal observed that the petitioner acted in good faith and did not intend to evade tax. Consequently, the Tribunal set aside the seizure, penalty order, and revisional orders, directing the immediate release of the goods if not already done.

In conclusion, the Tribunal, comprising Pradipta Ray and Deb Kumar Chakraborti, JJ., found in favor of the petitioner, setting aside the penalty order and subsequent revisional orders. The judgment emphasized the importance of considering all documents collectively and assessing their cumulative effect, rather than focusing on isolated technical defects. The ruling highlighted the petitioner's compliance with inter-State trade regulations and the absence of any fraudulent intent, leading to the decision to release the goods and overturn the penalty.