9911796707
TMI Blog2000 (3) TMI 1063X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 12(3)(b) of the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as "the Act") are as follows: 2.. At the assessment stage, the assessing authority proposed levy of 12 per cent tax on the sales of milk products amounting to Rs. 57,17,537.10. Further, the assessing authority also proposed to levy a penalty at 100 per cent of tax under section 12(3)(b)(iii) of the Act, having regard to the fact that there was a difference of 42 per cent between the tax assessed and tax paid as per the returns. In reply to the pre-assessment notice, the petitioner contended that the brand name of "Cocomilk" under which the goods were sold was not registered under the Trade and Merchandise Marks Act and therefore levy of 12 per cent tax is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore whether the brand name is registered or not, it is liable to tax at 12 per cent under entry in item 1(viii) of Part E of the First Schedule to the TNGST Act, 1959 with effect from March 12, 1993. As regards the claim of exemption, the Appellate Tribunal observed that the general rate of 5 per cent under section 3(1) of the Act was no longer in existence after it was omitted by Act 24 of 1993 and the commodities were brought under section 3(2) of the Act with effect from March 12, 1993. In such circumstances, the notification issued under section 3(1) of the Act by reducing the rate of tax from 5 per cent to 1 per cent is no longer in existence. Therefore, even if the notification has not been cancelled, the levy of tax at 12 per cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fication shall come into force on March 7, 1992." (Reference: Lawman's TNGST Act, 1959 published during 1993 at Ch. III-176) The Tribunal without discussion upheld the penalty and that no penalty is warranted as the book turnover is the basis for assessment and there was no wilful omission on the part of the co-operative society in not paying the tax at the enhanced rate. Thus, there is absolutely no case for levy of penalty. 4.. We have considered the contentions. At the outset, we would like to point out that the notification for reduction of tax from 8 to 5 per cent relied on by the learned Senior Counsel was cancelled with effect from March 17, 1993. The material portion of the notification reads as follows: "In exercise of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on November 4, 1974 and May 30, 1975, rate of tax was prescribed expressly for ice cream among other goods. In such circumstances, it was held by the Supreme Court that the notification dated May 21, 1974 was undone by the notification dated November 4, 1974 as well as by the notification dated May 30, 1975. In this regard, the Supreme Court followed the earlier decision of the Supreme Court in the case of Commissioner, Sales Tax, U.P. v. Agra Belting Works reported in [1987] 66 STC 1. In that case, it was held that where a notification is issued prescribing a rate of tax for goods, which may have been exempted from tax by an earlier notification, it must be held that the intention was to withdraw the exemption and make the sale eligible to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dismissed the issue regarding the rate of tax, it held that there was no case to interfere with the order of the Additional Appellate Assistant Commissioner thereby confirming impliedly the levy of surcharge and penalty also. It is the contention of the Mr. K.J. Chandran, learned Senior Counsel for the petitioner, that no penalty could be levied under section 12(3)(b) of the Act in this case as there is no wilful omission and that the assessment was not a best judgment assessment. We find that the material portion of the section 12(3)(b)(iii) of the Act reads as follows: "Section 12(3): In addition to the tax assessed under subsection (2), the assessing authority shall, in the same order of assessment passed under sub-section (2) or by a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f final assessment but the petitioner merely stated that if the refunds due are adjusted, then no penalty would arise in his case. The assessing authority, after adjusting the excess as desired, found that as against the difference of 42 per cent indicated in the pre-assessment notice, the difference after adjustment of excess amount has come down to 27 per cent and still section 12(3)(b)(iii) of the Act was attracted wherein the quantum of penalty prescribed is 100 per cent. Thus, we find that there is no escapement from the penalty provision inasmuch as the section clearly says that penalty shall be levied while making the assessment on the basis of incorrect or incomplete return and the quantum of penalty is as prescribed in the slab und ..... X X X X Extracts X X X X X X X X Extracts X X X X
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