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2019 (11) TMI 1720 - MADRAS HIGH COURTLevy of penalty in terms of Section 27(4) of the Tamil Nadu Value Added Tax Act, 2006 - wrongful availment of ITC - stock transfers - errors apparent on the face of record - HELD THAT:- In the present case the tax due has been quantified as 'nil' in all the impugned orders (see the tabulation at paragraph 9). This is an admitted position. We are not concerned with the demand of purchase tax raised, for the reason that the reference to 'tax due' in Section 27(4) relates specifically to amount computed under Section 27(2) of Act and not under Section 12, relating to purchase tax. Thus, in a case such as the present, where there is no tax computed, the machinery for computation of penalty, being a percentage of the tax due, fails. The revenue is unable to produce any other order of assessment passed subsequent to order of this Court dated 01.02.2016 raising a demand of tax on reversal of ITC. The scheme of assessment & levy of penalty in terms of Section 27(2) read with Section 27(4), supports the position that the quantification of tax should result in an actual 'due' from the assessee in order to render the provision for levy of penalty workable. The issue arising for determination as to the leviability of penalty per se, is a legal issue and hence the petitioner need not be relegated to statutory appellate remedy - petition allowed.
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