9911796707
TMI Blog1983 (11) TMI 263X X X X Extracts X X X X X X X X Extracts X X X X ..... vided under the Tamil Nadu General Sales Tax Act, he should be taken to have collected at the excess rate contravening the provision of the Act, and therefore, the penalty is leviable in respect of the excess collection of tax to the extent of Rs. 2,176. In the assessment order, though the assessee has submitted his objections to the levy of penalty in answer to the show cause notice issued by the assessing authority, the assessing authority did not consider any of the objections raised by the assessee, but merely passed a creptic order which is as follows: "I also levy a penalty under section 22(3) of the Tamil Nadu General Sales Tax Act, 1959." He had passed the above order after dealing with the turnover to be assessed. 3.. The ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the stand taken by the Revenue. Taking those circumstances into account the Tribunal has held that no penalty could be levied when the assessee has collected the tax at 4 per cent taking note of the stand taken by the Revenue. It is also pointed out by the Tribunal that in all the earlier years the assessee has collected tax at 4 per cent and the same has been remitted to the Department and the assessing authority also proceeded on the basis that the tax leviable is at 4 per cent and did not levy any penalty. In this view, the Tribunal set aside the order of penalty as the assessee has acted though bona fide in charging tax at 4 per cent. The question is whether the view taken by the Tribunal could legally be sustained? 5.. As po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in respect of sales of cloth bags is only at 2 per cent and not at 4 per cent. The assessing authority, however, rejected the assessee's contention and finalised the assessment holding that the cloth bags are taxable only at 4 per cent and not at 2 per cent as contended by the assessee. When an appeal was filed by the assessee, the Appellant Assistant Commissioner affirmed the order of the assessing authority holding that the cloth bags are taxable at 4 per cent. Thereafter, the assessee took the matter in appeal to the Tribunal and the Tribunal by its order dated 24th November, 1976, held that in view of the notification referred to above, the cloth bags are taxable only at 2 per cent and not at 4 per cent as contended by the Revenue. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 per cent. The Department having right through proceeded on the basis that the rate of tax on the sale of cloth bags is only at 4 per cent and having resisted the assessee's claim that it is taxable only at 2 per cent and having driven the assessee to go before the Tribunal to get a decision and the Tribunal having given a decision in favour of the assessee though for the earlier years, it cannot now turn round and say that the assessee has wrongly collected the tax at 4 per cent instead of 2 per cent. There appears to be a mutual mistake as to the rate of tax payable on the sale of cloth bags. Even the Department has been proceeding on the basis, till the Tribunal has rendered its decision on 24th November, 1976, that the sale is taxable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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