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TMI Blog2020 (3) TMI 817X X X X Extracts X X X X X X X X Extracts X X X X ..... , M/S RAMA SHYAMA PAPERS LTD., M/S GOELS COIR FOAM (INDIA) PVT. LTD., M/S CAMPHOR AND ALLIED PRODUCTS, M/S N.P. AGRO (INDIA) INDUSTRIES LTD., M/S BHOLENATH INDUSTRIES LTD. VERSUS STATE OF U.P. AND ANOTHER [ 2015 (11) TMI 48 - ALLAHABAD HIGH COURT] , the revisionist was entitled for the benefit under the Act, 1948. Perusal of the impugned order passed by the Tribunal clearly indicates that there was no material before the Tribunal to conclude that the excess Diesel has been diverted for private gain or that the excess quantity of Diesel Oil was utilised for other purposes which was different from the purpose of manufacturing sugar. Before coming to such a finding, there should have been sufficient material before the Tribunal to reach such a conclusion. In absence of any such material, such a finding cannot be recorded by the Tribunal. The matter is required to be remanded to the U.P. Trade Tax Tribunal, to pass fresh orders - revision allowed by way of remand. - Sales/Trade Tax Revision No. 672 of 2008 - - - Dated:- 6-1-2020 - Hon'ble Alok Mathur , J. For the Revisionist : Shubham Agrawal, Bharat Ji Agrawal For the Opposite Party : C.S.C. ORDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew of the findings not having been recorded by the Tribunal regarding existence of mens-rea on the part of the applicant, the imposition of penalty is justified? (3) Whether, in view of the finding that the diesel purchased against Form III-B has admittedly been used in generator set for generation of electricity used for plant and machinery, used for manufacture of Khandsari namely notified goods, the imposition of penalty under Section 4-B(5) of the Act was justified in absence of any mens-rea having been established against the applicant? 5. Learned counsel for the revisionist submits that he does not intend to press the substantial question of law nos. 1 and 2, thus only question no. 3 is relevant for consideration of this Court. 6. Learned counsel for the revisionist has submitted that for running the Sugar Industry Diesel Oil is utilised for repair and running the plant and machinery and therefore the revisionist is justified in procuring 175 Kilo Liters of Diesel Oil in the relevant assessment year. Counsel for the revisionist has drawn attention of this Court towards the provisions of Section 4-B (5) of the Act, 1948 and has submitted that it would have been pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich diesel oil has been used. Thus the generation of power by generators by use of diesel oil so as to run plant and machinery is integrally connected with the manufacture of the notified goods i.e. the final product of the petitioners. Thus, the manufacture of the notified goods itself is dependent upon the use of diesel oils in the generator sets directly. 29. Even if it is assumed that the use of diesel oil is indirectly connected with the manufacture of the notified goods yet thee is no denial of the fact by the Assessing Authority that the use of diesel oil in generator sets was essential for manufacture of the notified goods of the petitioners and the manufacturing itself is dependent on such use of diesel oil. 30. The only ground taken by the Assessing Authority in the impugned orders to delete the entry of diesel oil from the Recognition Certificate is that diesel oil is not a raw material for manufacture of the notified final products of the petitioners rather it is raw material to produce electricity. While doing so, the assessing authority completely lost sight of the Explanation (a) to Section 4-B(2) of the Act which defines the expression goods required f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore Diesel Oil and therefore there is reasonable probability that the such an excess quantity of Diesel which has been procured would have been diverted for use other than for which it was meant and therefore, penalty on the revisionist in this regard has rightly been imposed. 9. Heard learned counsel for the parties and perused the record. 10. It is undisputed that the revisionist was given recognition certificate under Section 4-B(2) of the Act, 1948, for purchase of diesel against form III-B as provided under Section 4-B of the Act, 1948. The Diesel purchased by the revisionist was used in the Generator Sets for generating electricity which in turn was used for plant and machinery which is required for manufacture of Khandsari Sugar . It is also undisputed that the revisionist has no power connection and Diesel Oil is used for running the generator sets installed in the factory premises to generate power for running the plant and machinery so as to manufacture final product. 11. In the impugned order passed by the Tribunal it has been mentioned that 10 Kilo Liters of Diesel Oil is utilised by the revisionist for running the plant and machinery for the production of fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y such material, such a finding cannot be recorded by the Tribunal. Perusal of entire impugned order does not disclose any material on the basis of which the Tribunal could have concluded that the excess quantity of Diesel Oil was diverted by the revisionist for some private gain, therefore, the penalty imposed upon the revisionist for the relevant assessment year appears to be arbitrary and without application of mind. 16. In the facts and circumstances of the case, this Court is of the opinion that in the interest of justice the order of Tribunal dated 26.03.2008, is liable to be set aside and the matter is required to be remanded to the U.P. Trade Tax Tribunal, to pass fresh orders in the light of discussion made herein above, or if it deems proper, remit the matter to the Assessing Authority to make fresh detailed enquiry and pass fresh order, in accordance with law. It shall be open for the assessee to move appropriate application before the Tribunal for producing relevant documents to substantiate their claim regarding utilisation of Diesel for the relevant assessment year. 17. In the light of above, the impugned order dated 26.03.2008, passed by the Tribunal, is set as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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