1994 (4) TMI 371 - HC - VAT and Sales Tax

Summary

Issues:
Challenge to legality of order passed by Commercial Tax Officer for compounding tax evasion offense.

Analysis:
The petitioner, a registered dealer under the Andhra Pradesh General Sales Tax Act, challenged the order passed by the Commercial Tax Officer accepting the offer to compound the offense of tax evasion on payment of Rs. 2,822. The irregularities found during inspection included incomplete chitta, ledger not commenced, and non-maintenance of stock register. The suppressed turnover was determined as Rs. 64,160 with tax payable at Rs. 1,411. Non-maintenance of accounts is considered a willful contravention of the Act. Section 32 allows for composition of offenses, and the assessing authority accepted the petitioner's request for composition instead of prosecution.

The appellate authority and Sales Tax Appellate Tribunal dismissed the appeals citing the finality of orders under section 32(2). The petitioner filed a writ petition challenging the legality of the order, claiming he was forced to admit the lapses. However, the court found that failure to maintain correct accounts amounts to tax evasion, and the assessing authority rightly accepted the request for composition. The court held that once the offer to compound the offense was accepted, the petitioner cannot challenge the order. The court dismissed the writ petition at the admission stage, stating that the plea of being forced to admit lapses was an afterthought.

In conclusion, the court upheld the order passed by the assessing authority for compounding the offense of tax evasion. The petitioner's failure to maintain proper accounts and the evidence of evasion through stock discrepancies supported the decision to accept the composition amount. The court emphasized the finality of orders under section 32 and dismissed the writ petition challenging the legality of the order.