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TMI Blog2017 (2) TMI 470X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax as well as the penalty. Financial constraints of the carrier do not constitute a valid reason for either waiver of any dues under Section 42 and 43-A of the Act or under Section 46 of the Act. Penalty - Held that: - The deliberate withholding of monies (taxes) by the petitioner from such statutorily sanctioned collections and diversion of it by the carrier for its own private use, instead of crediting it into Government’s account was in blatant disregard to statutory provisions. This omission – in depositing the collections was illegal and dishonest - the non-imposition of penalty in such case would dilute and indeed render ineffective the deterrence envisaged under Section 46 of the Act. The reduction of the penalty amount from the maximum to a third was justified. Petition dismissed - decided against petitioner. - WP(C) 6611/2001 - - - Dated:- 3-2-2017 - MR. S. RAVINDRA BHAT MR. NAJMI WAZIRI JJ. Petitioner Through: Mr. Atul Sharma, Adv. Respondents Through: Mr. Sanjeev Narula and Sh. Abhishek Ghai, Advocates. NAJMI WAZIRI, J (OPEN COURT):- 1. This petition impugns the order of the Government of India dated 30.04.2001 which upheld the Order-in-A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount of ₹ 12.5 crore, deposited by the lessor for the release of the distrained aircraft, has been appropriated by the department against the determined dues payable by the appellants, or that it has been already adjusted against the determined liability of the appellants, have no basis. Inspite of a clear observation made by the Assistant Commissioner in the impugned order that the appellants had not produced any letter from the lessor or any TR6 Challan to prove that the amount of ₹ 12.5 crore was deposited against the liability of the appellants, no such requisite evidence has been produced even before me. With a view to the foregoing, I hold that the dues, determined in the impugned order on account of IATT and interest thereon, are still unpaid and the appellants have been withholding that payment in gross violation of and utter disregard to the law; and therefore, the order of the Assistant Commissioner in question, directing the appellants to deposit the same immediately, suffers from no infirmity. I fail to find any substance in all other pleas relating to this aspect for the findings recorded above. One of their contentions mentioned in the appeal me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount deposited by the lessor has been or shall definitely be appropriated towards dues adjudged against the appellants. The plea, thus, I hold, is devoid of substance. In any case, the order of the Hon ble High Court passed on 18.01.99 in CW 1908/97, whereby the U.O.I. and the Commissioner have been directed to proceed for the recovery of the dues from the appellants, has to prevail. Order dated 18.01.99 read as following: It is not disputed now that during pendency of the writ petition and pursuant to the order passed by this Court, Assistant Commissioner of Customs (IATT) has on 10.1.1999 passed an order determining the tax liability of respondent No.5 for payment of inland air travel tax. In view of the fact that now liability has been determined, no other or further order deserves to be issued in this petition except that respondents Nos. 1 to 3 will act in accordance with law to recover the amount subject to course of rights of respondent No.5 to challenges the said order in appeal or otherwise in accordance with law. Ordered accordingly. The petition sands disposed of. 5. Aggrieved by the aforesaid order, the appellant filed a revision application whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant towards IATT in terms of the orders dated 10.4.98 and 10.2.98 of this Court in CW 110/97. 7. The learned counsel contended that: (a) requisite amounts towards dues as outstanding were already been paid to the Government and the same stood appropriated under the proper account; hence there was no further requirement of payment to be made by the petitioner; (b) the amount of ₹ 12.5 crore although deposited by the Lessor, was a permissible mode of recovery of IATT dues as contemplated under Section 46A(4) of the Act read with Rule 14(4) of the eponymous Rules and (c) having recovered the said amount by the aforesaid permissible method, it was not open to the Revenue to initiate recovery of the said amount from the petitioner all over again. Reliance was made upon the judgment of the Supreme Court in Purshottamdas Thakurdas v. CIT (1963) 48 ITR 206 to contend that once tax has been deducted by a mode of deduction under the statute, no other mode of collection of the tax can be legally resorted to. The petitioner has also cited several financial constraints which has led to the non deposit of the IATT dues. 8. Having considered the facts and circumstances of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mined is paid. The distrainment was only for the purpose of ensuring recovery of the monies then due. The monies deposited by a third party could not be deemed to have been adjusted against the aforesaid dues of the tax as well as the penalty. Financial constraints of the carrier do not constitute a valid reason for either waiver of any dues under Section 42 and 43-A of the Act or under Section 46 of the Act. 10. Furthermore, there is no letter or due communication from the Lessor agreeing to adjustment of the amounts paid by it against the carrier s tax dues. Indeed, the position is to the contrary as refund of the said amounts had been sought by the carrier. Hence, the contentions of the petitioner are untenable. 11. The rationale for reducing the penalty amount from ₹ 25 crores to ₹ 10 crore is sound and there is no ground to interfere with it. The deliberate withholding of monies (taxes) by the petitioner from such statutorily sanctioned collections and diversion of it by the carrier for its own private use, instead of crediting it into Government s account was in blatant disregard to statutory provisions. This omission in depositing the collections was ille ..... X X X X Extracts X X X X X X X X Extracts X X X X
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