2010 (3) TMI 1016 - HC - VAT and Sales Tax

Whether this is a case of misuse of process of law by the assessee? Held that - As more than sufficient opportunities were granted to the assessee on many occasions to produce the record to prove the genuineness of the declaration form ST XXII in support of the claim under section 5(2)(a)(ii) of the Act, but it (assessee) utterly failed to furnish the same and considerably delayed the matter despite adequate opportunities. Once, it is proved on record that the assessee has miserably failed to produce the record to prove the genuineness of the indicated declaration despite adequate opportunities, therefore, the assessee cannot possibly be heard to say that no opportunity was granted to it. The authorities below have recorded a categoric finding of fact that as the declaration made by the assessee based on bogus and ingenuine forms, therefore, determination of any substantial question of law did not arise at all, in the obtaining circumstances of the case. For the reasons recorded above, we, therefore, find no merit in the instant appeal, which is hereby dismissed.

Summary

Issues involved:
1. Validity of tax demand and penalty imposed under section 10(7) of the Punjab General Sales Tax Act, 1948.
2. Adequacy of opportunities provided to the assessee to prove the genuineness of the declaration.
3. Misuse of legal process by the assessee.

Detailed Analysis:

1. The judgment addresses the validity of the tax demand and penalty imposed under section 10(7) of the Punjab General Sales Tax Act, 1948. The petitioner, Bhaskar Ceramics (P) Ltd., was registered under the Act and faced scrutiny for the assessment year 1992-93, where a declaration of Rs. 49,33,358 was found to be not genuine. Subsequently, suo motu proceedings were initiated, and a show-cause notice was issued to the assessee. The revisional authority confirmed the tax demand and penalty, which was challenged by the assessee through various appeals and revisions.

2. The issue of whether adequate opportunities were provided to the assessee to prove the genuineness of the declaration is extensively discussed in the judgment. Despite multiple chances granted to the assessee to present evidence, delays and non-appearance hindered the process. The Sales Tax Tribunal and revisional authorities remanded the case multiple times for the assessee to substantiate its claims, but the assessee failed to do so effectively. The judgment emphasizes that the assessee's failure to produce evidence despite ample opportunities led to the confirmation of the tax demand and penalty.

3. The judgment also delves into the aspect of misuse of the legal process by the assessee. It highlights the repeated delays, adjournments sought, and non-appearance before the revisional authority despite being given opportunities. The court observed that the assessee's actions amounted to a misuse of the legal process and hindered the resolution of the matter effectively. The judgment cites legal precedents to support the findings and concludes that the assessee's failure to prove the genuineness of the declaration led to the dismissal of the appeal.

In conclusion, the judgment upholds the tax demand and penalty imposed on the assessee, emphasizing the importance of providing evidence to substantiate claims and the consequences of misuse of the legal process.