9911796707
TMI Blog2024 (11) TMI 711X X X X Extracts X X X X X X X X Extracts X X X X ..... ply to all pending assessments, including the present assessment relating to the period 1998-99. The reason for issuance of the Circular appears to an incorrect thinking on the part of the assessing officers that the penalty under Section 23 of the Act must mandatorily of 150% only. What the Commissioner has sought to clarify that the provision allows for discretion to be exercised by the assessing officer under Section 23 to levy penalty of a sum 'not exceeding one and a half times the tax payable' . Hence, the authorities may impose penalty at any rate upto amount from one to 150%. Despite the officer used to as a matter of rote and mechanically levy penalty only 150%. The admitted position is that the levy of penalty is attracted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce under section 45 shall be instituted in respect of the same facts on which a penalty has been imposed under this section. Note: Item 1 in Section 23 the expression four per cent was substituted for the expression three per cent by Act 29 of 1980-Effective from 5.9.1980. Again the expression three per cent was substituted for the expression four per cent by Act 34/91 Gazette dated 23.10.1991 Effective from 5.9.1991.' 3.There are two disputes that arise. The first relates to the rate of tax and the second relates to the quantification of penalty. As regards the first aspect, we have dealt with the same under order dated 28.10.2024 extracted below: 'Three points are made, the first one is violation of principles of natural justice, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in question. 8. Let the entire Circular be produced with a copy served in advance upon the other side in order that there is clarity on the period to which it relates. 9. List on 07.11.2024.' 4.Mr.V.Prashanth Kiran, learned Government Advocate would accede to the position that the rate of tax ought to have been taken at 13%. There is no dispute on this account. 5.Coming to the second limb in relation to whether the quantification of penalty 150% was correct, we have had occasion to advert to Circular No.5 dated 05.01.2001 bearing Ref.No.02/91364/2000. issued by the Principal Commissioner and Commissioner of Commercial Taxes, Chennai. 6.At the outset, Mr.Prashanth would seek to disavow this Circular stating that Section 28A endows power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer may also levy lower penalty for the violation of declaration in form XVII. It is also to be noted that if a generous view is not taken while levying penalty under section 23 of the Act in cases like this the dealers may go for interstate purchases which will result in loss of revenue to the State Government. Taking into consideration the above position and the provisions of the TNGST Act, the Assessing Authorities are directed to take a uniform view while levying the penalty under section 23 of the TNGST Act and levy a penalty equal to 1% of the difference in tax under Form XVII and diverted without using it in the manufacturing process within our state. In case the diversion is detected by the department and not disclosed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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