2012 (10) TMI 409 - HC - VAT and Sales Tax

Evasion of tax - non furnishing of the set of documents viz. Bill/invoice and GR at the ICC in respect of the consignment of 370 bags of Bidis - Penalty imposed u/s 51(7) (b) of the Punjab Value Added Tax Act, 2005 - Held that - As due to over-sight of driver he had left the invoice No.1900505 covering 370 bags in the vehicle and on being pointed out by the officer on duty, the driver went back and picked up the remaining documents from the vehicle and produced the same before the officer-in-charge. If the driver had been hiding to evade the payment of tax, he would have kept back Form ELTA-12 as well as Declaration Form-85. When all the documents relating to 370 bags were genuine, proper and complete in all respects and the transaction was voluntarily reported at the ICC, it would be treading in the realm of injustice to uphold the penalty. Leaving behind invoice No.1900505 ibid on the seat, does not seem to be intentional, rather oversight, which being a human mistake was rectifiable and by producing the same within no time before the officer on duty was rectified. The act being attributed to the driver, in no manner, was violative of the provisions of Section 51(2) of the Act. Consequently, the Penalizing Officer was not justified in imposing the penalty under Section 51(7)(b) of the Act, nor the first appellate authority has directed himself in the right perspective by affirming the findings of the officer incharge- cum-ETO, ICC Khallar Khera - in favour of assessee.

Summary

Issues:
1. Penalty imposed under Section 51(7) (b) of the Punjab Value Added Tax Act, 2005 deleted by the Tribunal.
2. Whether non-furnishing of documents indicated an attempt to evade tax.
3. Whether the plea of inadvertently leaving the invoice was an afterthought.
4. Whether the findings of the Tribunal were contrary to facts on record.

Analysis:

1. The State appealed against the deletion of the penalty imposed on a dealer under Section 51(7) (b) of the Punjab Value Added Tax Act, 2005. The Tribunal set aside the penalty order after the goods, including Bidis, were detained due to discrepancies in accompanying documents. The Tribunal concluded that the driver's oversight in leaving behind the invoice was a human mistake and not intentional tax evasion. The Tribunal highlighted the genuineness and completeness of the documents related to the consignment, emphasizing that the transaction was voluntarily reported at the ICC.

2. The Tribunal found that the driver had left the invoice covering the bags in the vehicle due to oversight, rectifying the mistake promptly when pointed out by the officer on duty. The Tribunal emphasized that all documents related to the consignment were genuine, proper, and voluntarily presented at the ICC. It was concluded that the driver's actions did not violate the provisions of the Act, and there was no intention to evade tax. The Tribunal noted that the penalty was not justified as there was no evidence of deliberate withholding of documents to evade tax.

3. The State's counsel failed to demonstrate any illegality or perversity in the Tribunal's decision. The Tribunal's view was considered reasonable, and no errors were identified in its findings. The State's appeal was dismissed as no substantial question of law arose from the case. The Tribunal's decision to delete the penalty was upheld based on the genuine nature of the documents and the absence of evidence indicating intentional tax evasion.

This detailed analysis of the judgment highlights the key issues, the Tribunal's reasoning, and the outcome of the appeal, providing a thorough understanding of the legal aspects involved in the case.