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2013 (2) TMI 660 - HC - VAT and Sales TaxNon payment of Professional tax - petitioner did not register itself under section 6 of the Andhra Pradesh Tax on Professions, Trades, Callings and Employments Act, 1987 nor did it file returns as provided under section 7 of the Act - penalty levied - Held that - In the absence of any provision enacted by the Legislatures for levy of penalty on the assessees who do not register themselves or file returns under the Act, there cannot be any levy of penalty. It is settled law that courts cannot supply a casus omissus Ashok Lanka v. Rishi Dixit 2005 (5) TMI 615 - SUPREME COURT and UCO Bank v. Rajinder Lal Capoor 2008 (3) TMI 656 - SUPREME COURT and only the Legislature can supply any lacuna in the Act. Therefore, levying penalty on the petitioner cannot be sustained. The first respondent had no jurisdiction under the Act to levy penalty on the petitioner which had not registered itself under the Act nor filed returns as mandated by the Act.In favour of assessee.
Issues:
1. Levy of penalty under section 8(5) of the Andhra Pradesh Tax on Professions, Trades, Callings and Employments Act, 1987 without registration and filing of returns by the petitioner. Analysis: The judgment by the High Court of Andhra Pradesh dealt with the issue of the petitioner, an educational institution, not registering itself under section 6 of the Act nor filing returns as required under section 7 of the Andhra Pradesh Tax on Professions, Trades, Callings and Employments Act, 1987. The assessing authority had assessed the profession tax dues payable by the petitioner for financial years 2007-08 to 2011-12 and levied a penalty under section 8(5) of the Act on the ground of willful tax evasion and non-disclosure of information. The petitioner contended that the penalty under section 8(5) could only be levied if assessments were made under section 8(1) and not under section 8(3) as in their case. The counsel for the petitioner argued that in the absence of registration and filing of returns, the assessing authority could only make a best judgment assessment under section 8(3) without the provision for penalty. The court analyzed section 8 of the Act, which outlines the assessment of an assessee. It highlighted that a penalty under section 8(5) could only be imposed by the assessing authority if there was willful non-disclosure of information or an attempt to evade tax. Sub-section (1) of section 8 deals with situations where a return is filed by the assessee, allowing the assessing authority to assess the tax due if the return is incorrect or incomplete. However, in cases where the assessee fails to register or submit returns, as in the petitioner's situation, sub-section (3) of section 8 enables a best judgment assessment without provision for penalty. The court emphasized that since the Act did not provide for the levy of a penalty on assessees who did not register or file returns, the assessing authority had no jurisdiction to impose a penalty in such cases. It cited legal precedents to support the principle that courts cannot fill legislative gaps, and only the Legislature can address any omissions in the law. Therefore, the court held that the impugned orders levying penalties on the petitioner were not sustainable, and the assessing authority lacked the authority to impose penalties on an entity that had not complied with registration and return filing requirements. Consequently, the High Court allowed the writ petitions, quashing the penalty levied on the petitioner by the assessing authority. The judgment concluded that the assessing authority had exceeded its jurisdiction in imposing penalties on the petitioner for non-registration and non-filing of returns under the Act.
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