2013 (9) TMI 981 - HC - VAT and Sales Tax

Imposition of penalty - Held that - Tax Board while maintaining the order of the Deputy Commissioner (Appeals) to the extent of waiver of penalty has placed reliance on a decision of Apex Court in case of Sree Krishna Electricals vs. State of Tamilnadu and Anr. 2009 (4) TMI 428 - SUPREME COURT OF INDIA . The learned Tax Board while interpreting Section 12(5) of the Entry Tax Act applying the ratio decidendi of the aforesaid verdict has recorded a definite finding that the assessee is registered under the Entry Tax Act and further it has deposited a sum of 2, 42, 221 on 8.3.2007 for the imported diesel and LDO against the tax liability and the receipt of the challan was also produced before the Commercial Taxes Officer Jaisalmer by the assessee on 9th of March 2007 therefore it is not desirable to invoke Section 12(5) of the Entry Tax Act. With this specific finding the learned Tax Board has maintained the order of the appellate authority to the extent it has set aside the order of imposition of penalty. In this view of the matter I am of the considered opinion that the learned Tax Board has not committed any error of law requiring interference by this Court in exercise of revisional jurisdiction. - Decided against Revenue.

Summary

Issues:
1. Revision petition under Section 86 of the Rajasthan Sales Tax Act, 1994 assailing the order of the learned Tax Board.
2. Imposition of penalty on the assessee for tax liability and interest on diesel and LDO purchases.
3. Interpretation of Section 12(5) of the Entry Tax Act regarding waiver of penalty.
4. Application of the ratio decidendi of a Supreme Court decision in Sree Krishna Electricals vs. State of Tamilnadu and Anr.

Analysis:
1. The petitioner-Revenue filed a revision petition under Section 86 of the Rajasthan Sales Tax Act, 1994 challenging the order of the learned Tax Board dated June 14, 2012. The Tax Board partly allowed the appeal of the Revenue against the appellate order of January 4, 2008, upholding the imposition of penalty. The appellate authority had set aside the tax liability and interest on the assessee, which was reversed by the Tax Board.

2. The respondent-assessee, engaged in the business of diesel and LDO, purchased these products and availed discounts/incentives. The assessee paid tax on the invoiced amount, not the discounted one, and did not submit a sales statement for entry tax. The assessing authority imposed tax, penalty, and interest after issuing a show cause notice. The Deputy Commissioner (Appeals) set aside the entry tax, interest, and penalty, which was challenged by the Revenue before the Tax Board.

3. The learned counsel for the Revenue argued that the Tax Board did not analyze the matter properly, making the impugned order unsustainable. However, the Tax Board, relying on the Supreme Court decision in Sree Krishna Electricals vs. State of Tamilnadu and Anr., interpreted Section 12(5) of the Entry Tax Act. It found that the assessee, registered under the Entry Tax Act, had deposited the tax liability amount and produced the receipt before the Commercial Taxes Officer, thus waiving the penalty under Section 12(5).

4. The Tax Board's decision to maintain the waiver of penalty based on the specific findings regarding the deposit made by the assessee was upheld. It was concluded that the Tax Board did not commit any legal error justifying interference by the Court in revisional jurisdiction. Consequently, the revision petition was dismissed for lacking merit.