2019 (12) TMI 65 - HC - VAT and Sales Tax

Imposition of penalty u/s 54(1)(14) of the U.P. VAT Act, 2008 - the penalty had been imposed solely on account of vital columns of Form-38 having been left blank with respect to import of floor cleaning machinery - HELD THAT - The first appeal authority appears to have deleted the penalty and that order has been confirmed by the Tribunal on the reasoning that there was no intention to evade tax inasmuch as the said machinery was being brought inside the State only for the purpose of demonstration and not for sale. Further, explanation of the assessee that the goods were properly accounted at Haryana after being imported from Italy has also accepted. The aforesaid findings of fact recorded by the Tribunal, as to absence of intention to evade tax appear to be based on material and evidence existing on record - Revision dismissed.

Summary

Issues:
1. Appeal against the order of the Commercial Tax Tribunal regarding the deletion of penalty imposed under Section 54(1)(14) of the U.P. VAT Act, 2008.
2. Lack of interest shown by the revenue in pursuing the matter further.
3. Imposition of penalty due to vital columns of Form-38 being left blank with respect to import of floor cleaning machinery.
4. Tribunal's findings on absence of intention to evade tax based on material and evidence on record.

Analysis:

The High Court of Allahabad heard a revision filed by the revenue against the order of the Commercial Tax Tribunal, NOIDA, which had dismissed the revenue's appeal and confirmed the deletion of penalty imposed under Section 54(1)(14) of the U.P. VAT Act, 2008. Despite issuing notice to the assessee earlier, no steps were taken in the matter for 7 years, indicating a lack of interest from the revenue's side in pursuing the case further. The penalty had been imposed due to vital columns of Form-38 being left blank concerning the import of floor cleaning machinery. The first appeal authority had deleted the penalty, and the Tribunal upheld this decision, considering that there was no intention to evade tax as the machinery was brought into the State for demonstration purposes only, not for sale. The explanation provided by the assessee that the goods were properly accounted for in Haryana after being imported from Italy was also accepted. The Tribunal's findings on the absence of intent to evade tax were deemed to be supported by the material and evidence on record, leading the High Court to dismiss the revision on the grounds of lack of steps taken and the factual findings mentioned above.