9911796707
TMI Blog2007 (12) TMI 426X X X X Extracts X X X X X X X X Extracts X X X X ..... evy of penalty under section 45A of the KGST Act for evasion of tax is perfectly justified. So far as quantum of penalty is concerned, penalty originally levied was ₹ 59,68,240 which was reduced by the Commissioner to around ₹ 18 lakhs after partially accepting the petitioner's claim. Therefore, the petitioner is not entitled to any quantum relief also. - - - - - Dated:- 4-12-2007 - RAMACHANDRAN NAIR C.N. , J. C.N. RAMACHANDRAN NAIR J. The petitioners were partners of a firm by name Jaya Medicals which was a registered dealer under the Kerala General Sales Tax Act, 1963. However, according to the petitioners, common petitioner in O.P. Nos. 18423 of 1997 and 29631 of 2002 retired in 1990 and the petitioner in O.P. N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Tax Rules, 1963 and he contended that since the retired partners did not give notice to the department, department was entitled to assume continuation of the firm making all the partners liable for the penalty levied. Rule 5(8) with sub-clauses are extracted hereunder for easy reference: 5(8)(a) Every partnership firm shall, at the time of submitting the application for registration under section 14, file a copy of the partnership deed and a declaration in form 2 signed by all the partners stating the names and addresses of all the partners and their respective shares in the business along with the application for registration. Every company or association of persons or body of individuals shall, at the time of submitting the applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the assessing officer. Consequently retirement of the partners and automatic dissolution of the firm after retirement of two partners out of three was not within the knowledge of the department. It is made mandatory in clause (d) above that after a partnership is dissolved and business is taken over by an individual, such individual has to take separate registration to continue business as registered dealer. The petitioners in all the original petitions admittedly did not comply with the procedural requirement under the Rules inasmuch as neither the firm nor the partners gave notice of retirement of the partners. Besides this, the continuing partner who is the petitioner in O.P. No. 18411 of 1997 did not take a fresh registration under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) may be given by any partner. The principle laid down in section 45 of the Partnership Act is that partners who hold out to be members of the firm to third parties will continue to be liable as such, if retirement or dissolution is not informed to third parties through public notice. It is this principle that is incorporated in rule 5(8)(b) of the KGST Rules which requires statutory notice to the assessing officer about dissolution of the firm. Therefore, if retiring partner does not give notice in form No. 3, he will continue to be liable for payment of tax, penalty, etc., payable by the firm or the continuing partners or partner to the department even after his retirement as if he has not retired. In the circumstances, the contenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the dealer who transfers the goods outside the State other than under contract of sale to prove the same. Rule 5A of the Central Sales Tax (Kerala) Rules, 1957, prescribes conditions and documents for proving consignment sales. It is seen from exhibit P16 order that petitioners have not ventured to prove that sales were effected in U.P. after transfer of goods from Kerala to Kanpur on consignment basis. The petitioners could have produced consignment agency agreements, sale particulars, details of commission paid and even details of tax paid in U.P. for establishing their case. However, it is seen that not even an attempt is made to prove the transaction as consignment transfers as claimed by them before the lower authorities. In the circ ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
