2016 (8) TMI 177 - HC - VAT and Sales Tax

Levy of penalty on the assessee for non-filling of Column-6 in From-38 in respect of the goods such as Trolleys, tyres and other wooden items, which were being transported from Rajpura (Punjab). - The goods were on a onward journey from Rajpura (Punjab) to Agra and were intercepted by the Mobile Squad - Held that - one thing, which is clear that the seizing authority itself has recorded that the goods, which were seized were found accompanied with certain documents. The Tribunal remained completely silent upon this aspect of the matter and has relied heavily on the fact that more than once the assessee had taken goods without filling column-6 of Form-38 and has drawn its conclusion from this fact that it seems that the assessee was a habitual defaulter. After examining this aspect of the matter, I am of the opinion that the Tribunal should have returned a finding on this fact also as to whether the documents, which were there before it would reflect whether or not there was intention to evade tax and as to whether documents supported the case of the assessee at all. Matter remanded back to tribunal.

Summary

Issues:
1. Imposition of penalty under Section 54(1) (14) of U.P. VAT Act for non-filling of Column-6 in Form-38.
2. Interpretation of legal precedents regarding imposition of penalty.
3. Consideration of intention to evade tax in penalty proceedings.
4. Justification of penalty imposition on the applicant.
5. Tribunal's failure to consider accompanying documents in determining intention to evade tax.

Analysis:
The revision pertains to the imposition of a penalty on the assessee for not filling Column-6 in Form-38 during the transportation of goods. The Tribunal had upheld the penalty, prompting the revisionist to challenge the decision citing various legal questions. The revisionist argued that the absence of intention to evade tax should be a prerequisite for imposing penalties under Section 54(1) (14) of the VAT Act. The counsel emphasized that despite the non-filling of Column-6, all accompanying documents matched the goods, indicating no intention to evade tax.

The Court analyzed the provisions of Section 54(1) (14) and acknowledged the violation of Sections 50 and 51 by the assessee. However, the crucial aspect of intention to evade tax was contested by the revisionist, pointing out that the documents accompanying the goods were consistent and no adverse findings were made by the seizing authority. The Court noted the Tribunal's oversight in not considering the accompanying documents and relying solely on the non-filling of Column-6 to infer an intention to evade tax.

In light of the discrepancies in the Tribunal's assessment, the Court remanded the matter back to the Tribunal for a detailed examination of whether the documents supported the assessee's case and if there was indeed an intention to evade tax. The Tribunal was directed to provide a clear finding on this aspect within three months. The Court also instructed that the penalty amount deposited by the assessee would be subject to the final decision of the Tribunal, ensuring a fair opportunity for both parties to present their case.

Ultimately, the Court disposed of the revision without costs, emphasizing the importance of a thorough evaluation of all relevant factors, including the intention to evade tax, in penalty proceedings. The remand to the Tribunal aimed to rectify the oversight and ensure a just determination based on a comprehensive assessment of the facts and accompanying documents.