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TMI Blog2008 (2) TMI 843X X X X Extracts X X X X X X X X Extracts X X X X ..... the society. In this view of the matter, it is held that penalty under section 45A read with section 19C of the KGST Act was rightly levied on all the petitioners for each of the years irrespective of whether the turnover arrived at in the case of individuals for any year is less than the non-taxable limit. The original petitions are, therefore, devoid of any merit and are dismissed. - - - - - Dated:- 29-2-2008 - RAMACHANDRAN NAIR C.N. , J. C.N. RAMACHANDRAN NAIR J. These connected cases are filed challenging penalty levied under section 45A of the Kerala General Sales Tax Act, 1963 for evasion of tax by the petitioners for the assessment years 1993-94 to 1996-97. The nature of transactions and the findings based on which penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs who sold paper for the manufacture of note books. When society was requested to furnish details of source of funds for the purchase, it was revealed that society never had the funds to make the purchases and the secretary gave statement that it is the petitioners who really purchased paper for making note books by taking DD in the name of the society thereby accounting purchase by the society. In fact the society has not accounted any sale of note books. On the other hand, the actual purchasers of paper, namely, the petitioners, manufactured note books and sold the same by accounting the transaction in the name of the society. This led to evasion of sales tax on the entire turnover. The secretary of the society gave statement to the Inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt gave an opportunity to the petitioners to file detailed affidavit denying the transactions, but with consequence that if affidavits are found to be false after enquiry through police, those who file false affidavit will face prosecution, no petitioner has come forward with any affidavit denying the transaction. Further it is seen from the adjudication order that many of the petitioners simply sought time for filing objection, but did not choose to file any objection. Another important matter to be noticed is that most of the petitioners were not even members of the said society and counsel appearing for the society also had conceded the same. The Cooperative Societies Act does not authorise outsiders to deal with the society and withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontained in any judgment, decree, order, direction or decision of any court, Tribunal or other authority, where the assessing authority has reason to believe that any person is, or was carrying on business in the name of, or in association with any other person, either directly, or indirectly, whether as agent, employee, manager, power of attorney holder, guarantor or in any other capacity, such person and the person in whose name the registration certificate, if any, is taken, shall jointly and severally, be liable for the payment of the taxes, penalty or other amount due under this Act which shall be assessed, levied and recovered from all or any of such person or persons as if such person or persons are dealers: Provided that before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... funds, is defunct and is closed. When the transactions leading to evasion of tax were carried out in the name of the society, there is no need to separate the turnover in respect of each one for the purpose of deciding liability for tax for each year. Therefore, the total turnover of business of all the petitioners carried on in the name of the society could be clubbed to determine whether there is tax liability and based on this, penalty also could be levied under section 45A of the KGST Act. Separate amounts are dealt with in the penalty order only for the purpose of recovery of penalty from each of the petitioners in proportion to business carried on by them in the name of the society. In this view of the matter, I hold that penalty und ..... X X X X Extracts X X X X X X X X Extracts X X X X
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