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TMI Blog2016 (2) TMI 1238X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act, 2005 - fraud and suppression of facts or not - HELD THAT:- While both Sections 53(1) and 53(3) confer power to impose penalty for under declaration of tax by a dealer, the distinction between the former and the latter is that the ingredients of the latter are attracted where fraud or commission of neglect has been established - In the present case, the show notice does not even allege fra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sary for imposing penalty under Section 53(3) of the Act must be discernible from the show cause notice; and, in the absence of any such basis being disclosed in the show cause notice, the order levying penalty under Section 53(3) must be set aside. As the SCN in the present case, does not even allege that the petitioner had committed fraud or wilful neglect, the impugned order of penalty must be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 53(3) of the Act and, in the light of the law declared by the Division Bench of this Court in Viceroy Hotels Limited vs. Commercial Tax Officer (2011) 43 VST 424 (AP) the impugned order is liable to be set aside. Section 53(3) of the Act confers power on the authorities to impose penalty for failure to declare the tax due. Under sub-section (1) thereof, where any dealer has under declared tax, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sections 53(1) and 53(3) confer power to impose penalty for under declaration of tax by a dealer, the distinction between the former and the latter is that the ingredients of the latter are attracted where fraud or commission of neglect has been established. In the present case, the show notice does not even allege fraud or commission of wilful neglect. The impugned order, whereby penalty was impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty under Section 53(3) must be set aside. As the show case notice, in the present case, does not even allege that the petitioner had committed fraud or wilful neglect, the impugned order of penalty must be and is, accordingly, set aside. It is made clear that this order shall not preclude the respondents, if they so choose, from initiating penalty proceedings afresh in accordance with law. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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