9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2009 (10) TMI 885 - HC - VAT and Sales TaxInterpretation of statute - Section 50 of the VAT Act - Penalty on firm u/s 54 (1) of the UPVAT Act, 2008 - incomplete Form 38 - Held that - the Division Bench decision in the case of Jain Shudh Vanaspati Ltd., Ghaziabad and others vs. State of U.P. and others 1983 (1) TMI 226 - ALLAHABAD HIGH COURT still holds the field and is relevant for the interpretation of Section 50 of the VAT Act - The language of Sections 28-A (6) and 50 (4) is synonymous. There is absolutely no difference in the language. The interpretation of Section 28-A read with Section 28-A (6) given by the Division Bench of this Court in the case of M/s Jain Shudh Vanaspati is applicable to the interpretation of Section 50 read with Section 50 (4) - Thus, for the detention/seizure of the goods under Section 50 read with Section 50 (4) and 50(5), a case of an attempt to evade the tax and an attempt to evade assessment or payment of tax due or likely to be due under this Act has to be made out as a condition precedent. Before imposing penalty the authority has to give notice under Section 54 (1) and to record a finding either on the basis of material before it, or produced by the dealer, or any other person, or the department and which may include incomplete Form 38, (which may be a ground for seizure of the goods), that there was an intention to evade the payment of tax - petition dismissed - decided against petitioner.
Issues:
Challenge to notice under Section 54(1) of the U.P. Value Added Tax Act, 2008 for intention to evade tax based on incomplete Form 38; Conflict in judicial decisions regarding penalty imposition criteria; Interpretation of Section 28-A of U.P. Trade Tax Act; Requirement of intention to evade tax for penalty imposition under Section 54(14) of VAT Act. Analysis: The judgment addresses a writ petition challenging a notice under Section 54(1) of the U.P. Value Added Tax Act, 2008, alleging intention to evade tax due to incomplete Form 38 accompanying an import. The petitioner sought relief citing conflicting judicial decisions and emphasizing the need for the court to resolve the issue. The respondent argued for the petitioner to exhaust alternative remedies provided under the Act before seeking court intervention. The court referenced the interpretation of Section 28-A of the U.P. Trade Tax Act in the case of Jain Shudh Vanaspati Ltd., emphasizing the necessity of proving intent to evade tax before imposing penalties. It highlighted that mere incomplete documents do not warrant penalty unless there is evidence of tax evasion intention, as per the provisions of the Act. Regarding conflicting decisions, the court discussed the judgments in Multitex Filtration Engineering Ltd. and M/s K.M.G.S. Road Signs Pvt. Ltd., noting the importance of complete documentation like Form 38 for seizure but emphasizing the requirement of establishing intent to evade tax before imposing penalties under Section 54(14) of the VAT Act. The court reaffirmed that the principle of intent to evade tax, as established in the Jain Shudh Vanaspati Ltd. case, remains crucial even under the VAT Act. It clarified that penalty imposition necessitates a finding of intent based on evidence, including incomplete documentation like Form 38, which may trigger seizure but does not automatically justify penalties. Ultimately, the court dismissed the writ petition, directing the petitioner to pursue the statutory remedies available under the Act, including showing cause to the concerned authority. The judgment underscores the continuing relevance of proving intent to evade tax as a prerequisite for penalty imposition, ensuring a fair and evidence-based approach in tax enforcement matters.
|
