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2010 (11) TMI 896 - KERALA HIGH COURTWhether the Tribunal was justified in confirming the order of the first appellate authority modifying the penalty levied on the petitioner under section 67(1) of the Kerala Value Added Tax Act? Held that:- On facts and based on records verified by the intelligence officer what is clear is that the petitioner made an attempt to camouflage the spare parts sales as sale of scrap because the bills disclose the price fixed based on weight which is factually incorrect. In the first place nobody purchases pieces of iron scrap from an automobile spare dealer. Scrap is generally sold in bulk and the petitioner did it in the breaking yard itself. The balance items brought and sold under the guise of scrap were really found to be old parts recovered from dismantled vehicles. The attempt of evasion is established beyond doubt and therefore, the petitioner has no escape from the penalty. We therefore uphold in principle the orders of the lower authorities in confirming the penalty on the petitioner for evasion of tax. It is not known whether the petitioner remitted the tax or whether the turnover is assessed to tax at higher rate. Since the petitioner is only a small scrap dealer, we feel the petitioner can be granted reduction of penalty provided the petitioner pays tax based on the assessment orders. We accordingly grant a conditional reduction of penalty to 50 per cent of the tax provided the petitioner pays the tax based under the assessment orders on the turnover involved at higher rate.
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