2012 (1) TMI 149 - HC - VAT and Sales Tax

Whether the impugned orders passed by the learned below authorities without establishing the mala fide intention on part of the appellant in view of essential ingredients of relevant provision of section 51 are legally sustainable in the eyes of law? Whether the act on the part of the learned below authorities to pass the impugned orders without perusing the relevant documents is legally sustainable in the eyes of law? Whether the impugned orders are legally sustainable in the eyes of law? Held that - The Tribunal after appreciating the material on record had correctly arrived at the conclusion that there was an attempt at evasion of tax on the part of the appellant as M/s. Snowman Frozen Foods Limited was having its business at Pind Ganna, Phillaur, District Jalandhar whereas the destination mentioned in the documents was M/s. Modern Refractories, Village Ikoloha, District Ludhiana which were reported by the driver of the vehicle at the ICC. The findings recorded by the Tribunal having not been shown to be erroneous or perverse in any manner, no question of law much less substantial question of law arises in this appeal.

Summary

Issues:
- Appeal under section 68 of the Punjab Value Added Tax Act, 2005 against impugned orders
- Legality of impugned orders without establishing mala fide intention
- Legality of passing orders without perusing relevant documents
- Legality of impugned orders overall

Analysis:
1. The appellant filed an appeal under section 68 of the Punjab Value Added Tax Act, 2005 against impugned orders dated June 27, 2006, July 23, 2009, and December 24, 2010. The appellant raised substantial questions of law regarding the legality of the orders passed without establishing mala fide intention and without perusing relevant documents.

2. The appellant, engaged in importing and selling temperature control units, dispatched goods to another company for demonstration and trial purposes. However, the goods were detained, and a penalty was imposed for alleged tax evasion. The appellant contended that the goods were not for sale and were sent for trial purposes, emphasizing a lease agreement to support their claim.

3. The Tribunal found discrepancies in the documents and concluded that there was an attempt at tax evasion by the appellant. The Tribunal noted inconsistencies in the destination of the goods, the parties involved, and the lack of genuine documentation supporting the appellant's claims. The penalty was imposed under section 51(7)(b) of the Act based on these findings.

4. The Tribunal's decision was upheld as it was deemed not erroneous or perverse. The court found no substantial question of law arising from the Tribunal's findings, leading to the dismissal of the appeal.

5. In conclusion, the court dismissed the appeal, affirming the Tribunal's decision regarding the penalty imposed on the appellant for alleged tax evasion. The court found no merit in the appellant's arguments challenging the legality of the impugned orders and upheld the decision based on the findings of discrepancies in the documents and lack of evidence supporting the appellant's claims.