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2013 (11) TMI 921 - HC - VAT and Sales TaxJurisdiction of the Joint Commissioner under Section 34 of the Tamil Nadu General Sales Tax Act - Initiation of penal proceedings - Held that - The assessee did not produce any material, except to the extent on merits, to hold that penalty cannot be levied - if the assessee had had no grievance as regards the issue raised by the Revenue proposing to levy penalty before the first Appellate Authority, we do not find any inhibition even otherwise on the authority of the Joint Commissioner to invoke his revisional powers to give a direction to the Assessing Officer to invoke penalty in view of Section 23 on the violation of Form XVII. Thus, we reject the prayer of the assessee as to the jurisdiction of the Joint Commissioner under Section 34 of the Tamil Nadu General Sales Tax Act to give such directions to the Assessing Officer as regards initiation of penal proceedings - Decided against assessee.
Issues:
1. Jurisdiction of Joint Commissioner under Section 34 of Tamil Nadu General Sales Tax Act. 2. Levy of penalty under Section 23 of Tamil Nadu General Sales Tax Act. 3. Reasonable cause for violation of Form XVII. Jurisdiction of Joint Commissioner under Section 34 of Tamil Nadu General Sales Tax Act: The Tax Case (Appeal) involved a dispute regarding the jurisdiction of the Joint Commissioner to direct the Assessing Officer to invoke Section 23 of the Tamil Nadu General Sales Tax Act. The Appellate Assistant Commissioner had initially rejected the Revenue's contention for the levy of penalty. The assessee argued that the subsequent decision of the Court should not have been the basis for the Joint Commissioner's intervention. The Court clarified that the Joint Commissioner's power under Section 34 is limited to cases prejudicial to the Revenue's interests. The Court cited the case of A.Velayutha Raja v. The Board of Revenue (C.T.) Madras to emphasize that the Joint Commissioner's authority is confined by the provisions of the Act and cannot exceed the Assessing Officer's jurisdiction. Levy of penalty under Section 23 of Tamil Nadu General Sales Tax Act: The dispute arose from the purchase of tyres and tubes by the assessee at a concessional tax rate under Section 3(3) of the Tamil Nadu General Sales Tax Act for use in animal-driven vehicles. The Revenue contended that the assessee was not entitled to the concessional rate, leading to the initiation of penalty proceedings under Section 23 due to the violation of Form XVII. The Appellate Assistant Commissioner initially ruled in favor of the assessee based on a previous decision. However, the Joint Commissioner, relying on a subsequent decision, upheld the penalty imposition. The Court upheld the Joint Commissioner's decision, emphasizing that the violation of Form XVII warranted the penalty under Section 23, even if the item was used as a component part of other goods. Reasonable cause for violation of Form XVII: The Court declined to consider the reasonable cause for the violation of Form XVII at that stage, noting that the assessee could present its case during the proceedings initiated by the Assessing Officer under Section 23. The Court rejected the contention that the previous decision served as a reasonable cause for the violation, stating that the decision only determined when a penalty could be imposed, without providing a justifiable cause for the violation. Ultimately, the Court dismissed the Tax Case (Appeal) as it found no grounds to interfere with the Joint Commissioner's order regarding the penalty under Section 23.
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