2015 (4) TMI 1122 - HC - VAT and Sales Tax

Imposition of penalty - Unrecorded 472 tins of oil - No evidence to prove that it have been recorded in the books of accounts or supported by bills and vouchers - Held that - the Deputy Commissioner (Appeals) who had analysed the matter at a greater detail after going through the books of accounts, stock register and purchase/sale vouchers came to the conclusion that the assessee was unable to prove only two tins of oil with a value of ₹ 900, accordingly on a value of ₹ 900 penalty of ₹ 270 was sustained. The Revenue has been unable to contradict the finding of fact recorded by the two appellate authorities. Therefore, no infirmity, illegality or perversity found in the order passed by the Tax Board. - Decided against the revenue

Summary

Issues:
Assessment of penalty for unrecorded stock found during a survey for the assessment year 1994-95.

Analysis:
The case involved a sales tax revision petition against an order passed by the Rajasthan Tax Board related to the assessment year 1994-95. The dispute arose when a survey conducted in May 1994 revealed 472 tins of oil unrecorded, valued at Rs. 2,12,400. The assessing officer imposed a penalty of Rs. 60,000 as the assessee failed to provide acceptable evidence for the unrecorded stock. The Deputy Commissioner (Appeals) partially allowed the appeal, reducing the penalty to Rs. 270. The Rajasthan Tax Board upheld the Deputy Commissioner's decision, stating that only two tins of oil worth Rs. 900 were unrecorded. The Revenue argued that the appellate authority should not have accepted material evidence when the assessee had admitted guilt during the survey. However, the court found that the appellate authorities had thoroughly analyzed the evidence, including stock registers and vouchers, to conclude that only a minimal amount of unrecorded stock existed.

The court held that the findings of fact by the appellate authorities were based on the material presented, which showed only a minor discrepancy in stock recording. The Deputy Commissioner's detailed analysis of the books of accounts, stock registers, and purchase/sale vouchers supported the conclusion that the unrecorded stock was negligible. The court noted that the Revenue failed to challenge the factual findings of the appellate authorities. Consequently, the court found no legal question arising from the case and upheld the decision of the Tax Board, dismissing the revision petition.