2012 (1) TMI 135 - HC - VAT and Sales Tax

Whether the Appellate Tribunal is right in law in modifying the taxable turnover to 3, 02, 641 being the 50 per cent difference of turnover arrived by the assessing officer as against the reported taxable turnover? Whether the Appellate Tribunal is right in law in having set aside the order of the Appellate Assistant Commissioner and restore the order of the assessing officer does have any valid materials to sustain the turnover of 50 per cent of the difference of the turnover arrived at by the assessing officer as against the reported taxable turnover? Whether in the facts and circumstances of the case the Appellate Tribunal is right in law in deleting the penalty of 1, 04, 069 under section 12(3)(b) of the Tamil Nadu General Sales Tax Act 1959 even though the assessee has not reported the turnover as taxable and paid tax which amounts to filing of incorrect and incomplete return? Held that - The order of the Tribunal is based on valid material. It is a question of fact. It is not a perverse order. We find no illegality or error in the order of the Tribunal that warrants interference by this court. Therefore no question of law arises for consideration in admitting this tax case revision.

Summary

Issues:
1. Modification of taxable turnover by the Appellate Tribunal.
2. Setting aside the order of the Appellate Assistant Commissioner by the Tribunal.
3. Deletion of penalty under section 12(3)(b) of the Tamil Nadu General Sales Tax Act, 1959 by the Tribunal.

Analysis:

1. The Appellate Tribunal modified the taxable turnover to &8377; 3,02,641, which was 50% of the difference between the turnover reported by the assessee and that arrived at by the assessing officer. The Tribunal justified this by considering the assessing officer's estimation as excessive and harsh. The Tribunal applied an eight percent tax rate for the period from April 1, 1996, to July 15, 1996, and an eleven percent rate for the period from July 17, 1996, to March 31, 1997. The Tribunal's decision was based on the assessment officer's estimation and the proportionate reduction of the turnover, leading to a valid conclusion. The High Court found no illegality or error in the Tribunal's decision, concluding that the order was not perverse and did not warrant interference.

2. The Tribunal set aside the order of the Appellate Assistant Commissioner, who had refixed the taxable turnover at &8377; 9,94,478, disagreeing with the assessing officer's estimation. The Revenue contended that the Tribunal erred in reducing the turnover to 50% and in setting aside the penalty. However, the High Court upheld the Tribunal's decision, stating that the Tribunal correctly exercised its discretion in reducing the turnover based on valid reasoning. The High Court found no grounds for interference, as the Tribunal's decision was not erroneous.

3. The Tribunal deleted the penalty of &8377; 1,04,069 imposed under section 12(3)(b) of the Tamil Nadu General Sales Tax Act, 1959. The Tribunal concluded that there was no specific concealment of turnover, leading to the deletion of the penalty. The High Court agreed with the Tribunal's decision, stating that the Tribunal correctly applied its mind and found no illegality in deleting the penalty. The High Court held that the Tribunal's decision was based on valid material and factual considerations, leading to the dismissal of the tax case revision.

In conclusion, the High Court dismissed the tax case revision, stating that no question of law arose for consideration. The Tribunal's decisions regarding the modification of taxable turnover, setting aside the Appellate Assistant Commissioner's order, and deleting the penalty were upheld based on valid reasoning and factual analysis.