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2014 (5) TMI 371 - HC - VAT and Sales TaxTax liability of interstate stock transfer - Movement of goods for works contract – assessee claimed that could not use the electronically generated Forms VAT 505 stating that the goods being transported were not for sale and it is only a stock transfer. – Levy of Tax – Imposition of Penalty - Power of commissioner – validity of circular - Held that:- Judgment in Sri.Thirumalesh, reported in Time Tech India Private Limited V/S State of Karnataka [2014 (4) TMI 368 - KARNATAKA HIGH COURT] followed - Invoking the revisional power u/s 64(1) on the ground that the order passed by the Appellate Authority is prejudicial to the interest of the revenue is totally incorrect - The appellant has transported the goods with valid document as required u/s 53(2)(b) of the Act - When such being the case, the question of imposing penalty u/s 57(12) of the Act does not arise - There is no breach of any statutory duty - Further, the Commissioner can only issue circular and he has no power to issue notification under the Act - All the notifications had to be issued by the State Government and it has to be gazette - In the instant case, the notification dated 21-3-2009 is not gazette - Hence it cannot be treated as mandatory - The revisional authority without considering the objections raised by the appellant, only under the impression that there is revenue loss to the State Government had set aside the order passed by the Appellate Authority which is contrary to law. The appellant has not violated any of the provisions of KVAT Act - The goods has been transported from one project area to another situated out side the State and the same is not for sale - Hence, the question of payment of tax does not arise - Imposition of the penalty under Section 53(12) of the KVAT Act is contrary to the provisions of the Act - Hence, the order passed by the revisional authority cannot be sustained - The appeal is allowed. The order dated 15-9-2009 by the Addl. Commissioner of Commercial Taxes u/s 64(1) of the KVAT Act is set aside - The order passed by the First Appellate Authority is restored – Decided in favour of assessee.
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