TMI Blog2014 (9) TMI 465X X X X Extracts X X X X X X X X Extracts X X X X ..... on the paper book is made, result is no different. On August 1, 2000, a demand of ₹ 39,017 was raised vide debit note by M/s. Anuj Jain and Sons, (HUF) Delhi on M/s. Samsung Electronics India Ltd., Noida on account of service charges for arranging transfer of first four licences in the table as above. When the information given in the tabular form as above, is evaluated in this context, it transpires that value of these four licences was ₹ 1,30,35,637. Commission of M/s. Anuj Jain and Sons, Delhi in the shape of service charges turns out to be 0.30 per cent. It is, thus, clear that the service provider charged service charges for transfer of first four DEPB licences. So far as other two licences sold to M/s. Laxmi Enterprises, Delhi, are concerned, no particulars of service provider were supplied by the appellant. appellant had not shown any sale having been made by it to those parties from whom it had received these payments. Conversely, no payment had been received from the dealers to whom the sales of licences were alleged to have been made by the appellant - On perusal of the paper book, it becomes apparent that these sales were made by the appellant in fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in such documents. Decided against assessee. - VATAP Nos. 135 (O&M), 136,137,138 of 2012 - - - Dated:- 22-5-2013 - RAJIVE BHALLA AND BHARAT BHUSHAN PARSOON DR., JJ. For the Appellant : M.P. Devnath. The judgment of the court was delivered by DR. BHARAT BHUSHAN PARSOON J.- By this common order, we shall dispose of VAT Appeal Nos. 135, 136, 137 and 138 of 2012 as these have their genesis in orders of reassessment for the assessment years 2000-01 and 2001-02, which orders have been upheld up to the Haryana Tax Tribunal, Chandigarh (in short, the Tribunal ) vide consolidated order dated January 2, 2012, which order is under challenge in these four appeals. In VATAP Nos. 135 and 136 of 2012 imposition of penalty has been assailed, whereas through VATAP Nos. 137 and 138 of 2012, imposition of tax has been challenged. In these appeals, the appellant has proposed the following questions of law for consideration: (i) Whether, in facts and circumstances of present case, the impugned order passed by the Haryana Tax Tribunal, Chandigarh, is erroneous, unjust, incorrect and unsustainable in law and fact? (ii) Whether, in facts and circumstances of present case, the H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y located at Faridabad (Haryana) is engaged in manufacturing of electric motors. It was registered under the Haryana General Sales Tax Act, 1973 (hereinafter referred to as the State Act ) during the relevant years. During the course of its exports, it had got Duty Entitlement Pass Book Licences (in short, DEPB licences ). These DEPB licences were freely tradeable and sale of such licences was treated as sales of goods in terms of the decision of the Supreme Court of India in Yasha Overseas v. Commissioner of Sales Tax [2008] 17 VST 182 (SC). During the year 2000-01, gross turnover of the appellant had included turnover from the sale of DEPB licences to the tune of ₹ 6,04,59,157. This part of total turnover was claimed to have been earned from sales made to a registered dealer of Faridabad. Said registered dealer had made declaration in form S.T.-15 qua these sales. As sales turnover of DEPB licences was entitled to be allowed as admissible deduction from the total turnover, such deduction was allowed in original assessment order of June 25, 2004 of the Deputy Excise and Taxation Commissioner, Faridabad (East)-cum-Assessing Authority. Sometime later, the concerned Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d wrongly raised demand against the appellant. It is claimed further that the appellant was unnecessarily dragged into this controversy whereas no proceedings were initiated by the authorities against M/s. Sai Enterprises. It is thus asserted that sale of DEPB licences to M/s. Sai Enterprises was a local sale and proceedings against the appellant terming the sales as inter-State sales are totally misdirected. The contention of the appellant further is that the reassessment proceedings are without jurisdiction, illegal and contrary to law when there is no evidence either to show that the licences were sold to entities outside the State of Haryana. It is urged that transfer letters duly verified by a bank to sell these licences were made available by the appellant in the name of registered dealers in the State of Haryana and, thus, neither adverse inference could be drawn nor could bank drafts/banker's cheques received from other entities outside the State of Haryana used to raise an adverse inference against the appellant. It was urged that once requisite declaration in ST-15 forms had been given by the purchasing dealer and these forms had been produced during assessment pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Milk loses its identity and character and is turned into curd. Such is the sweep and potency of fraud. Merely because fraudulent transactions were punctuated by statutory declarations in form S. T.-15 made by the vendees, such fraudulent transactions would not be accepted as genuine. Reason is simple. When claim of the appellant of the sales to be registered dealer sales held within the State of Haryana, is defeated being fraudulent backing of such transactions with declaration in form S.T.-15 has to give way. The Tribunal had rightly noted this aspect of S.T.-15 forms in words, which are to the following effect: 10. . . . Once this conclusion is reached, disallowance of deduction in respect of claim of sales of DEPB made to M/s. Krishna Enterprises notwithstanding furnishing of the statutory declaration in form S.T.15, becomes a foregone conclusion because when the claim of the sale itself has been defeated, there is no question of the claim of deduction on furnishing of the declaration in respect of the said sale succeeding. The plea of the appellant that there is no supporting evidence, to disbelieve and reject the registered dealer local sales allegedly made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18,20,023 24.3.2000 31.7.2000 19,83,825 Total 44,81,377 48,84,701 44,61,042 G. Total 1,75,17,014 1,90,93,545 1,90,93,542 In addition to the details given in the tabular form for the assessment year 2000-01, it is relevant to mention here that on August 1, 2000, a demand of ₹ 39,017 was raised vide debit note by M/s. Anuj Jain and Sons, (HUF) Delhi on M/s. Samsung Electronics India Ltd., Noida on account of service charges for arranging transfer of first four licences in the table as above. When the information given in the tabular form as above, is evaluated in this context, it transpires that value of these four licences was ₹ 1,30,35,637. Commission of M/s. Anuj Jain and Sons, Delhi in the shape of service charges turns out to be 0.30 per cent. It is, thus, clear that the service provider charged service charges for transfer of first f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entirely non-participative but had also been feigning ignorance about vital information and particulars qua such sales. To demonstrate this part, order dated March 4, 2013 passed by this court is reproduced as below: Present: Mr. M.P. Devnath, Advocate, for the appellant. The learned counsel for the appellant seeks time to produce the particulars of bank accounts of M/s. Krishna Enterprises and M/s. Laxmi Enterprises that the transaction amount of sale of DEPB was received by the said dealers directly from Samsung/Honda Siel. List on April 8, 2013. A copy of this order be placed on the file of each connected case. March 04, 2013. Sd/(HEMANT GUPTA) Judge Sd/(RITU BAHRI) Judge Despite the adjournments having been sought thereafter by counsel for the appellant, no compliance with orders of this court was made and instead finally counsel for the appellant had shown his inability to produce such record and did not produce the same. The evidence available in the paper book reveals that during the assessment year 2000-01, following payments had been received by the appellant-firm through the banking channels: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t for the year 2000-01) had been received in the account of the appellant; (ii) Instead payment of sales of DEPB licences in fact, was received from M/s. Samsung Electronics India Ltd., Noida and M/s. Laxmi Enterprises, Delhi, in account of the appellant; (iii) No payment is shown to have been made in terms of purported sale from the appellant to M/s. Krishna Enterprises for 2000-01 and to M/s. Sai Industries for 2001-02; (iv) Entire stock of six such licences was lying dormant with the appellant. For the year 2000-01, value of these DEPB licences was ₹ 1,75,17,014. These were shown to have been sold to M/s. Krishna Enterprises for ₹ 1,90,93,545. This transaction carries an apparent profit of ₹ 15,76,531. By this analogy, if version of the appellant is taken to be correct, then on further sale by its vendee M/s. Krishna Enterprises, it was to adjust the amount of ₹ 15,76,531 and was to earn further profit, but strangely enough as per the case of the appellant, M/s. Krishna Enterprises is alleged to have made further second sale of the licences to M/s. Samsung Electronics India Ltd., Noida and M/s. Laxmi Enterprises, Delhi on the same price. It is hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) This had not been properly signed; (ii) These are no documents recognized under rule 43 of the Act; (iii) Not signed properly. Sequelly, it is evident that these debit notes were introduced to hide the actual inter-State transactions in a bid to avoid the payment of tax due to the revenue, i.e., the State of Haryana under the Central Act. It may also be noticed that the Assessing Officer vide assessment order dated October 3, 2005 had also noticed under section 48 of the Act and section 9(2) of the Central Act for taking penalty action against the appellant. Consequently, the additional demand of ₹ 25,75,967 as raised against the appellant. All the circumstances including the transactions conducted through banking channels reveal that the payments were made direct to the appellant by M/s. Samsung Electronics India Ltd., Noida and M/s. Laxmi Enterprises, Delhi (for the assessment year 2000-01) and M/s. Honda Siel Cars India Limited, Noida (for the assessment year 2001-02) who were located outside the State of Haryana. It is further clear that intermediaries, viz., M/s. Krishna Enterprises and M/s. Sai Industries for the year 2000-01 and 2001-02, respectively had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lds itself, it turns out to be a case of cheating right from the very beginning in which the appellant had clearly contrived and confabulated with M/s. Samsung Electronics India Ltd., Noida and M/s. Laxmi Enterprises, Delhi as also with M/s. Honda Siel Cars India Limited, Noida, to give colour of registered dealer sales to the inter-State sales by using names of M/s. Krishna Enterprises and M/s. Sai Industries, Faridabad as a subterfuge in defrauding and cheating the revenue. It is also clear that documents such as debit notes and ST-15 forms were contrived as valuable securities when these documents in fact were not even backed by the transactions which these documents projected to be representing. Thus, it is a case of forging of documents to represent non-existent fraudulent transactions, whereas actual transactions were different and distinct from these purported sales and in fact had nowhere been depicted in such documents. To generate concomitant faith and complete compliance with the benevolent legislations as also with schemes of the State and of the Centre from the trade, the taxation authorities may, if deemed proper, consider even moving under penal laws against such ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
