9911796707
TMI Blog2005 (1) TMI 642X X X X Extracts X X X X X X X X Extracts X X X X ..... the offence was compounded as evidenced by exhibit P2 proceedings of the Intelligence Officer dated December 31, 1994. The operative portion of the orders exhibits P1 and P2 would clearly show that it is the offence of non-maintenance of true and complete accounts committed by the dealer, which was compounded departmentally in lieu of prosecution and a sum of Rs. 48,874 towards compounding fee for the year 1991-92 and maximum amount of Rs. 1,00,000 towards compounding fee for the year 1992-93 were paid by the assessee. Thereafter by exhibit P3 proceedings dated June 30, 1995 original assessment was revised on finding that a portion of the turnover of the business had escaped assessment. Likewise by exhibit P4 dated June 30, 1995 revised assessment orders were passed for the year 1992-93 invoking section 19(1) of the KGST Act. There is no dispute that the assessee had paid the balance tax due as per the revised assessment orders exhibits P3 and P4. Later, by exhibits P5 and P6 notices under date June 3, 1996 the Sales Tax Officer proposed to impose penalty of Rs. 1,03,458 under section 45A(1)(d) read with section 19(2) of the Act relating to the year 1991-92. Likewise an amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Sales Tax Department that no penalty is imposed in a case where the assessee admitted the offence and compounded the same after remitting the prescribed compounding fee. 3.. The learned Government Pleader, Sri Soman on the other hand contended that the offence compounded is "non-maintenance of true and correct accounts" as is evidenced by the orders, exhibits P1 nd P2. Whereas the penalty now imposed is for a different offence, i.e., for "wilful non-disclosure of the taxable turnover". As such the offence compounded was a different offence and in no way absolve his liability to be proceeded with under section 19(2) of the Act. It is also his contention that there is nothing to indicate in section 19(2) of the Act that the penalty should also be imposed simultaneously with the order of revised assessment passed under section 19(1) of the Act. However, he was unable to make any submission as to whether the officer had passed an order as dictated by the superiors in the absence of any counter-affidavit filed in the case. 4.. Heard both sides and perused the orders. 5.. I shall now consider the first contention as to whether the compounding of the offence as evidenced b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irect the dealer to pay, in addition to the tax assessed under subsection (1) a penalty as provided in section 45A: Provided that no such penalty shall be imposed unless the dealer affected has had a reasonable opportunity of showing cause against such imposition. Explanation. Notwithstanding anything contained in the Indian Evidence Act, 1872, the burden of proving that the escape from assessment was not due to wilful non-disclosure of assessable turnover by the dealer shall be on the dealer." 7.. On a combined reading of sub-sections (1) and (2) of section 19 of the Act, it can be seen that at the time of reassessment under section 19(1) of the escaped turnover, the assessing authority may impose penalty in addition to the tax that may be assessed. The words "making an assessment under sub-section (1)" make it abundantly clear that it is in the course of such assessment made under section 19(1) that the officer has to apply his mind and decide whether a penalty is to be imposed in addition to the tax and if he is so satisfied, he may impose penalty in addition to the tax as provided in section 45A. In other words section 45A is referred to only for the purpose of quantifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent" as required by law. While imposing a penalty under sub-section (2) of section 19, two conditions are postulated: (1) That the assessing authority must be satisfied that the escapement from assessment was due to wilful disclosure of assessable turnover by the dealer. (2) It is in the course of making the assessment that such satisfaction is formed to impose penalty in addition to the tax assessed after affording him an opportunity of being heard. But in the present case it was not in the contemplation of the officer at the time of passing the revised order of assessment to impose penalty and it is only later as a result of the influence exerted on him that by a separate order he imposed the penalty. On a reading of section 19(2) it could be seen that it is only in the process of making an assessment that the authority may, if satisfied, impose penalty in addition to the tax assessed. In other words, once an assessment order is completed under section 19(1) of the Act and left no indication in the said order that the officer proposes to impose penalty by a separate order it must be held that the officer was not satisfied that it is a fit case to impose any penalty while making ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... termination of the reassessment proceedings, is contrary to section 19(2) of the Act and hence without jurisdiction. 12.. It is also to be noticed that the petitioner has specifically made averments in paragraph 5 of the original petition that the petitioner on enquiry came to know that the penalty was imposed on him by the first respondent at the instance of the second respondent who was the administrative superior of the first respondent and in spite of the insistence of the second respondent, the first respondent initially refused to initiate penalty proceeding stating that in cases where the dealer compounds offence by admitting the offence and remitting compounding fee penalty is not usually imposed and it would be unjustified, but the second respondent submitted a report to the Board of Revenue about the same and it was in the above circumstances that the first respondent was forced to initiate penalty proceedings against the petitioner. He has also averred that these informations are available in file No. R2-400(9)/96 of the office of the second respondent as well as in the assessment file of the first respondent. This averment is not controverted by filing any counteraffi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
