2016 (6) TMI 142 - HC - VAT and Sales Tax

Imposition of penalty - Section 78(5) of the RST Act - Import of certain electrical goods from Singapore - Declaration form ST-18A was not found with the driver - Held that - the penalty has rightly been deleted by the DC(A) and the said order has been upheld by the Tax Board which is just and proper. Admittedly, the goods were being imported directly from Singapore as per bill of entry and builty etc. produced at the time when the vehicle was intercepted. It is also admitted that the said goods had directly come after custom clearance from New Delhi International Airport and such a finding of fact has been noticed by all the three lower authorities. In my view, there is a difference in between the goods coming in the state of Rajasthan from other States as against the goods being directly imported from foreign countries as in the instant case. No occasion would arise for carrying a declaration form in such a case as the foreign seller may not be aware of such eventualities of filing of declaration form ST-18A. Needless to mention it will be detrimental to even imports from foreign countries as the foreign seller may not be aware of Indian Laws (Tax) and filling such declaration form as and when goods are sold to Indian Traders/Businessman and which came after custom clearance. Though Rule 53 prescribes that declaration form ST-18-A is required to be carried but in my view, not at least in such an eventuality where the goods were directly imported from the foreign countries. It is also a finding of fact recorded even by the AO that the claim of the respondent-assessee was that the goods were brought into India for self use (for own use) and consumption and not for sale. Taking into consideration these finding of fact recorded by the DC(A) and such finding of fact upheld by the Tax Board, in my view, the order impugned is just and proper and is not required to be interfered with. - Decided against the revenue

Summary

Issues:
1. Imposition of penalty for not carrying declaration form ST-18A for imported goods.
2. Interpretation of Rule 53 regarding the necessity of carrying declaration form for goods entering the State of Rajasthan.
3. Difference in requirements for goods imported from foreign countries compared to goods brought in from other states.
4. Applicability of penalty in cases of goods directly imported from foreign countries.
5. Consideration of facts and findings by lower authorities in penalty imposition.

Analysis:
1. The case involved the imposition of a penalty by the Assessing Officer (AO) for not carrying the declaration form ST-18A for imported goods. The respondent-assessee contended that the goods were directly imported from Singapore and were for personal use, hence the declaration form was not necessary. The AO imposed the penalty citing Rule 53 as mandatory for all cases, leading to an appeal by the respondent.

2. The Deputy Commissioner (Appeals) (DC(A)) deleted the penalty based on the explanation provided by the respondent. The DC(A) found the explanation satisfactory, leading to the deletion of the penalty. The Revenue further appealed to the Tax Board, which upheld the decision of the DC(A) but for different reasons.

3. The petitioner argued that Rule 53 mandates carrying the declaration form for all goods entering the State of Rajasthan, regardless of whether they are imported or brought from other states. The petitioner emphasized the requirement of the declaration form and cited a previous judgment that was later reversed by the Supreme Court.

4. The High Court considered the arguments presented and reviewed the facts and orders of the lower authorities. It noted that the goods were directly imported from Singapore after custom clearance and were for personal use, not for sale. The Court highlighted the distinction between goods imported from foreign countries and those brought in from other states, stating that the foreign seller may not be aware of the necessity of the declaration form.

5. Ultimately, the High Court upheld the decision of the lower authorities in deleting the penalty. It found no substantial question of law arising from the Tax Board's order, except for the reliance on a judgment that had been overturned by the Supreme Court. The Court concluded that the penalty imposition was not justified in this case, considering the specific circumstances of directly imported goods for personal use. The petition was dismissed for lacking merit.