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TMI Blog2015 (11) TMI 880X X X X Extracts X X X X X X X X Extracts X X X X ..... t he over-stepped his jurisdiction to impose penalty by holding that it was evasion of payment of tax. - there is nothing illegal or impermissible for a party in so arranging its affairs that the liability to pay tax would not be attracted or that the brunt of taxation would be reduced to the minimum. In the cited authority, version of the appellant was accepted and transfers made by the company were taken to be genuine by the Sales Tax authorities. - State Counsel has not been able to demonstrate any flaw in the approach of the Tribunal which may warrant interference - no factual or legal infirmity in the impugned order of the Tribunal - Decided against Revenue. - V. A. T. A. P. No. 18 of 2009 - - - Dated:- 13-8-2014 - AJAY KUMAR MITTAL AND BHARAT BHUSHAN PARSOON DR. JJ. Piyush Kant Jain, Additional Advocate-General, Punjab, for the appellants. K. L. Goyal, Senior Advocate with Rohit Gupta for the respondent. ORDER This appeal by the Department is directed against order dated 6.11.2008 passed by the Punjab Value Added Tax Tribunal (in short the Tribunal) whereby appeal of the respondent-company had been accepted and orders of the Assistant Excise and Taxation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant-Department but the only question of law, which emerges to be answered, is as under:- Whether order dated 31.12.2003 (Annexure A-1) of the checking officer, affirmed by the Appellate Authority vide order dated 26.10.2004 (Annexure A-2) was within the jurisdiction of the said authority? 6. The impugned order of penalty has been passed under Section 14-B(7)(ii) of the Act. This provision could be invoked only when there was violation of sub-section (2) or of sub-section (4) of Section 14-B of the Act. Concedingly, Section 14-B of the Act deals with the establishment of check posts or of information collection centres including for export of goods in transit. Merely because drivers of the vehicles of the respondent-company were carrying with them some more documents other than the relevant ones for despatch and transfer of the goods, tenor and temperament of the transaction forming propelling force for movement of the goods would not change. 7. Proceedings under Section 14-B of the Act are of summary nature. The Officer In-charge of the check post or Information Collection Centre or any officer referred to in sub-section (2) suspects that the goods under transpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he amount of transaction as may be prescribed. (3)xxx xxx xxx xxx (4)The owner or person incharge of a goods vehicle entering the limits or leaving the limits or the State of Punjab shall stop at the nearest check post or information collection centre, as the case may be, and shall furnish in triplicate a declaration mentioned in sub-section (2) along with the documents in respect of the goods carried in such vehicle before the officer incharge of the check post or information collection centre. The officer incharge of the goods vehicle to enable him to produce the same at the time of subsequent checking, if any. Provided that where a goods vehicle bound for any place outside the State of Punjab passes through the State, the owner or person incharge of such vehicle shall furnish, in duplicate, to the officer incharge of the check post or information collection centre, a declaration of his entry into the State of Punjab in the prescribed form and obtain from him a copy thereof duly verified. The owner or person incharge of the goods vehicle, shall deliver within forty eight hours the aforesaid copy to the officer incharge of the check post or information collection centre a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urther steps are required to be taken by the officer incharge of a check post. However, as per provisions of sub-section 6, if the officer incharge of the check post or Information Collection Centre has reason to suspect that the goods under transport are meant for trade and not covered by proper and genuine documents or for other reasons find that the person transporting the goods is attempting to evade payment of tax then for reasons to be recorded in writing, a detention order of goods alongwith vehicle could be passed and the goods have to be released on executing a bond with sureties in the prescribed form or furnishing a security or even bank guarantee etc. The expression 'reason to believe' used in sub-section (6) of Section 14-B of the Act imposes an obligation on the officer incharge of the check post to act objectively and not merely on the basis of his arbitrary opinion formed. The example could be if the details given in all the documents do not tally with the goods in the vehicle then there may be justification for detention of the goods. However, the provisions do not permit the officer to go to the extent of determining the nature of the transaction, which, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ething which he was not expected to do under the provisions of section 28-A of the Act. His job was to ascertain whether the prescribed documents accompanied the vehicle and the goods which in turn were liable to tax under the Act. Anything else he did would be without jurisdiction and we have no hesitation to state, that on account of his total misdirection, there was improper exercise ofjurisdiction and the order of the Appellate Tribunal, the first appellate authority as well as Check-post Officer are, therefore, liable to be quashed and they are accordingly quashed. 14. In Parry and Company Ltd. v. Commissioner of Sales Tax, U.P., Lucknow, [2004] 138 STC 437, it was held that check post officer was not competent to go into the nature of transaction which could only be decided in regular assessment proceedings. It was held that he over-stepped his jurisdiction to impose penalty by holding that it was evasion of payment of tax. Counsel for the respondent-company has further sought support from Utakal Galvanisers Limited v. Commissioner of Commercial Taxes, Orissa and others, [1997]104 STC 222 (Orissa) and Xcell Automation v. Government of Punjab and another, [2007]005 VST 308 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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