2013 (12) TMI 1676 - HC - VAT and Sales Tax

Penalty u/s 45A of the KGST Act - discrepancy in quantity recorded by the petitioner as transported in trucks - Held that - In the present case, the petitioner have shown 1,000kgs in the delivery note, whereas he has actually transported 10,000kgs. As against 600 kgs he would have transported 6,000 kgs. and likewise, in respect of all the delivery notes, he had transported 10 times the quantity that is shown as per the delivery note and the books of account. There is a clear finding that when the vehicle was having a capacity of 6,000 kgs to 10,000 kgs and that too national permit vehiclesowned by petitioner. Hence there is every possibility that the petitioner would have carried at least ten times quantity as shown the delivery note. In fact, the assessing officer had only taken ten times, whereas, it is possible that the petitioner would have even carried the full capacity of the truck involved - In fact, the assessing officer had only taken ten times, whereas, it is possible that the petitioner would have even carried the full capacity of the truck. Under these circumstances,we do not think that the petitioner/appellant is justified in contending that the quantum of penalty is excessive. Appeal dismissed.

Summary

Issues:
Penalty levied under Section 45A of the KGST Act.

Analysis:
The petitioner appealed against the penalty imposed under Section 45A of the KGST Act. The case involved discrepancies in the transportation of raw rubber, where the quantity recorded in the books of account did not match the actual quantity transported. The Intelligence Officer found substantial discrepancies and suspected tax evasion, leading to the imposition of a penalty of Rs. 5,22,000. The officer cited contravention of various provisions and intentional evasion of tax as reasons for the penalty. The petitioner failed to produce duplicate copies of delivery notes despite multiple opportunities, further strengthening the case for tax evasion. The Single Judge upheld the penalty, emphasizing the significant difference in recorded quantities and the failure to produce required documents.

Further Analysis:
The petitioner's counsel argued that the penalty for one specific delivery note had been set aside by the appellate authority, suggesting a different outcome for the remaining 16 delivery notes. However, since the petitioner failed to produce any duplicate copies as requested, the Intelligence Officer's conclusion of tax evasion was deemed valid. The appellate authority concurred with this view, reinforcing the case against the petitioner. The court found no reason to question the judgment of the Single Judge based on these circumstances.

Legal Interpretation:
Regarding the penalty under Section 45A of the KGST Act, the court clarified that the liability extends beyond a fine of Rs. 10,000. The section allows for penalties up to twice the amount of tax evaded, emphasizing the importance of maintaining accurate accounts and complying with statutory provisions. In this case, the petitioner's failure to provide evidence of actual quantities transported resulted in the upheld penalty. The court rejected the argument that the penalty was excessive, citing the substantial discrepancy between recorded and actual quantities as justification for the penalty amount.

This comprehensive analysis highlights the key details and legal interpretations of the judgment, focusing on the issues related to the penalty imposed under Section 45A of the KGST Act.