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TMI Blog2018 (3) TMI 977X X X X Extracts X X X X X X X X Extracts X X X X ..... refunded the amount to the petitioner as a consequence of holding that the petitioner is eligible for exemption of the contract receipt. The levy of penalty and the adjustment of TDS towards the said penalty is illegal - petition allowed - decided in favor of petitioner. - W.P.No.24939 of 2013 - - - Dated:- 25-1-2018 - T. S. Sivagnanam, J. For Petitioner : Mr.S.Ramanathan For Respondent : Mr.M.Hariharan Additional Government Pleader ORDER Heard Mr.S.Ramanathan, learned counsel for the petitioner and Mr.M.Hariharan, learned Additional Government Pleader for the respondent. 2.The petitioner who is the registered dealer on the file of the respondent under the provisions of the Tamil Nadu Value Added Tax Act, 2006 (T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onomic Zone was furnished for the information of the Assessing Officer. The respondent on receipt of the same accepted the stand taken by the petitioner and held that the petitioner is eligible for exemption on the contract receipt of ₹ 1,84,19,590.00. However, in the impugned assessment order, the respondent has stated that the TDS amount recovered and remitted by the contractee attracts penalty under Section 40(2) of the TNVAT Act and accordingly levied penalty of ₹ 1 lakhs and adjusted the TDS to the said penalty. This order is impugned in this writ petition. 2.Firstly, it has to be pointed out that at no point of time the petitioner deducted the tax at source but it is the contractee for whom the petitioner executed the w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondent is liable to refund the amount deposited to the dealer, namely, the petitioner herein. 3.Section 40 of the TNVAT Act deals with collection of tax. In terms of sub-section (1) of Section 40 of the TNVAT Act, no person, who is not a registered dealer, shall collect any amount by way of tax and no registered dealer shall make any such collection except in accordance with the provisions of the Act and the rules made thereunder. Sub-section (2) of Section 40 of the TNVAT Act states that if any person or registered dealer collects any amount by way of tax in contravention of the provisions of sub-section (1) of Section 40, the assessing authority may, after giving such person or dealer a reasonable opportunity of being heard, by order, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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