Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2014 (5) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (5) TMI 873 - HC - VAT and Sales TaxWhether Tribunal is correct in holding that the petitioner has collected Additional Sales Tax from the Electricity Board overlooking the fact that it is not the tax collected but reimbursement made by the Electricity Board - Taxable Turnover - Collection of Additional Sales Tax or reimbursement made by the Electricity Board - Held that:- Records reveal that the petitioner has collected 2.25% as additional sales tax on their sales turnover from TNEB - So there is no dispute that there is collection of additional sales tax by assessee which is contrary to the provisions of the Tamil Nadu Additional Sales Tax Act - Therefore, it is only the reimbursement of the amount by the TNEB as per the agreement entered between the assessee and the TNEB and the same cannot be construed as an offence which warrants levy of penalty - There is no dispute that there is reimbursement of Additional Sales Tax - It may not be a direct collection but the fact remains that there is collection of tax though the payment is made by the Electricity Board voluntarily - Once, the assessee received additional sales tax, it certainly amounts to violation of Section 2(2) - So all the authorities below had given a finding that there is collection of additional sales tax and hence there is a violation of the provisions of the Act - Thus, the same finding is confirmed. Whether Tribunal was correct in upholding the levy of penalty imposed u/s 12(5)(iii) of the TNGST Act, 1959 Reduction in Penalty Held that:- Section 3-A contemplate quantum of amount should not exceed 1 = times such amount - Assessee is a Government of India undertaking and there was agreement between the Electricity Board and assessee - As per the agreement, Additional sales tax was reimbursed and the same amounts to clear violation of provisions of Section 2 therefore, liable to pay levy penalty u/s 3A - Section 3-A prescribe only maximum amount of penalty and there is no minimum amount of penalty prescribed - After considering the facts and circumstances and also the bona-fide belief of assessee, this Court of the view that the authorities are wrong in levying 100% penalty - It is reasonable to levy 20% of penalty as against 100% penalty levied by the authorities. Levy of Penalty u/s 16(2) - Wilful non-disclosure of turnover - Held That:- The said provision is not applicable to the facts of the case - Penalty could be levied u/s 16(2), only when AO satisfy that the escape from the assessment is due to wilful non-disclosure of assessable turnover by the dealer - According to assessee, the Assessing Authority before imposing penalty could have considered the explanation and levied penalty under Section 16(2) and the authorities below have not at all considered the explanation and there is no finding that there is wilful non-disclosure of turnover - Relying upon Anantharam Veerasinghaiah and Co., Vs. Commissioner of Income Tax A.P., [1980 (4) TMI 2 - SUPREME Court] - Levying of penalty AO u/s 16(2) is not justified - It is well settled principle that the degree of finding for the imposition of penalty has to be on higher order than that required for the purpose of making an assessment The authorities should give a finding that there is wilful non-disclosure of the turnover - Here, there is no such finding - On the other hand, the assessee gave objections to the Assessing Authority and was under the bona fide belief that the turnover was not subjected to tax Therefore, the order of Tribunal is set aside - Revision is partly allowed Decided partly in Favour of Assessee.
|