2017 (5) TMI 658 - HC - VAT and Sales Tax

Penalty u/s 51(6)/51(7)(c) of PVAT Act - detention of vehicle - Held that - the assessee had placed reliance on the affidavit of Mr. Sarabjit Singh, driver who was driving the vehicle at the relevant time. He himself had admitted through his affidavit that he had crossed the ICC without generating the information - it was not the first transaction and even prior to that, the goods were being taken through that way. Thus, the mere excuse that the driver did not know about the location of the ICC, was not accepted. Further, the goods were carried away through a vehicle which was not used for carrying the goods. Consequently, the Tribunal rightly concurred with the findings recorded by the authorities below and dismissed the appeal filed by the appellant-assessee - penalty upheld - decided against appellant-assessee.

Summary

Issues:
1. Competency of Designated Officer to impose penalty under Section 51 of the Punjab VAT Act.
2. Imposition of penalty under Section 51(6)/51(7)(c) without tax evasion attempt.
3. Consideration of written submissions and documents by the Tribunal.
4. Adequacy of material consideration in the impugned order.

Analysis:
1. The appellant-assessee challenged an order under Section 68 of the Punjab Value Added Tax Act, 2005, questioning the competency of the Designated Officer to impose penalties. The Tribunal did not address this issue as it was not raised by the appellant. The Tribunal found that the driver admitted to crossing the ICC without generating information, indicating prior knowledge of the route. The Tribunal upheld the penalty, stating the excuse of not knowing the location was insufficient due to prior transactions through the same route.

2. The Tribunal examined whether penalties under Section 51(6)/51(7)(c) were rightly imposed without an attempt to evade tax. The appellant argued the invoices were true and genuine, with no intention to evade tax. However, the Tribunal found the appellant had prior knowledge of the route and used a vehicle not meant for transporting goods, strengthening the case for tax avoidance. The Tribunal upheld the penalty based on these findings.

3. The appellant contended that the Tribunal failed to consider written submissions and documents. The Tribunal's decision did not mention these submissions, leading to the appellant's claim of inadequate consideration. However, the Tribunal's detailed analysis of the driver's admission and prior transactions indicated a thorough review of the case facts, even without explicit mention of certain documents.

4. Lastly, the appellant argued that the impugned order should be set aside due to inadequate consideration of the material on record. The Tribunal's findings, based on the driver's admission and past conduct, were deemed well-founded and reasoned. The Tribunal's decision was upheld as legally sound, with no demonstrated illegality or perversity by the appellant's counsel. Consequently, the appeal was dismissed based on the Tribunal's factual findings and legal conclusions.