2022 (3) TMI 630 - HC - VAT and Sales Tax

Validity of assessment order - sales suppression besides adding 50% towards probable omission - petitioner mainly contended that the first respondent has passed the order, which is impugned in this writ petition, without physically verifying the delivery challans - excess stock of doors noticed during inspection were either damaged doors or there is a calculation mistake made by the inspection team but it was not properly appreciated by the first respondent-Tribunal - levy of penalty u/s 12 (3) (b) of the TNGST Act - HELD THAT - The Tribunal, on perusal of the stock register or the records relating to the case, has rendered a specific finding that there were interpolations made in the entries in the stock register and therefore, the plea of the petitioner cannot be accepted. Such a finding of fact rendered by the Tribunal is not required to be interfered with by this Court. On the whole, the various findings rendered by the Tribunal in the order, which is impugned in this writ petition, are based on material evidence over which this Court cannot interfere in exercise of the jurisdiction conferred under Article 226 of The Constitution of India. There is no illegality or perversity in the order passed by the first respondent-Tribunal, warranting our interference - Petition dismissed.

Summary

Issues:
Petitioner seeks to quash an order related to sales tax assessment. Discrepancies in stock transfer and delivery challan noticed during inspection. Appeal filed by petitioner against assessment order. Appellate authority reduced estimated turnover. Tribunal set aside appellate authority's order. Petitioner challenges Tribunal's order.

Analysis:
1. Discrepancies in Assessment: The petitioner, a registered dealer under TNGST and CST, reported turnover for assessment year 2002-2003. Inspection revealed stock differences and discrepancies in stock transfer and delivery challan. Second respondent assessed sales suppression and imposed penalty under TNGST Act.

2. Appellate Proceedings: Petitioner appealed assessment order before Appellate Assistant Commissioner, who reduced the turnover estimate based on stock difference and deleted probable omission addition. Appellate authority accepted petitioner's claim of damaged stock and discrepancies in delivery challan entries.

3. Tribunal's Decision: Second respondent appealed against the appellate authority's order before the Tribunal. Tribunal set aside the order, citing discrepancies in delivery challan entries and stock transfer. Tribunal concluded that the dealer manipulated figures and evaded tax intentionally.

4. Petitioner's Contentions: Petitioner argued that stock differences were due to totalling mistakes and damaged doors were not accounted for. Petitioner claimed damaged PVC doors were yet to be replaced. Petitioner contended that the Tribunal did not consider relevant evidence, such as delivery challans, and passed the order without proper verification.

5. Respondent's Defense: The second respondent argued that discrepancies were unearthed during inspection, leading to the assessment order. The first respondent concluded that the dealer manipulated figures and had malafide intentions to evade tax. The first respondent observed interpolations in the stock register and discrepancies in the entries.

6. Court's Decision: The Court rejected petitioner's contentions, noting findings by the Tribunal based on material evidence. The Tribunal found interpolations in the stock register, indicating malafide intentions of the dealer. The Court held that the Tribunal's decision was not illegal or perverse, warranting interference.

In conclusion, the Court dismissed the writ petition, upholding the Tribunal's decision based on the evidence presented. The Court found no grounds for interference, as the Tribunal's findings were supported by material evidence, and the petitioner's contentions were not accepted due to discrepancies in the stock register and delivery challan entries.