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2016 (9) TMI 827 - HC - VAT and Sales TaxDemand of tax with interest - imposition of penalty under Section 45(6) of the Act - documents in support of the claim for exemption from demand of tax - GVAT - Penultimate sale - drums - packing material - export consignment - local sales - benefit of tax exemption on penultimate sale - Held that: - the penultimate sale before export of the goods shall also be deemed to be in course of such export provided the conditions contained in sub-section 3 of Section 5 are satisfied. For applicability of sub-section 3 of Section 5, the seller has to fulfill the requirements of sub-section 4, failing which the provisions of sub-section 3 would not apply. The requirements are thus prescribed to ensure the compliance requirements under sub-section 3 and further to ensure that the competent authority can verify the claim of the assessee of being a penultimate seller of the goods in course of export sale. To satisfy the requirements of sub-section 4 of Section 5, a necessary declaration as prescribed under the Rules would have to be made. This would include declaration containing specified details. These details provided in items no.3 to 6 to the Schedule contain various information such as name of airport, seaport or land customs station through which the goods have been exported, name of airlines, ship etc. or other means of transport through which the export has taken place and such other relevant details. All these requirements would relate to actual export of goods sold by the assessee to the exporter. Only through such declarations would it be possible for the Assessing Authority to verify the claim of a dealer that the goods supplied were for the purpose of export and were actually exported by the purchaser-exporter. Mere declaration or assertion by the assessee would not be sufficient. Only upon satisfying such requirements contained in sub-section 4 of Section 5, the assessee would be covered by the deeming fiction provided under sub-section 3 of Section 5 and can claim the benefit of the export sale. When the revisional authority noticed discrepancies in the different documents supplied by the assessee, he was within his rights to deny the benefit of tax exemption to such extent. The penalty is discretionary and can be levied upto 1 ½ times the difference between the amount paid and tax assessed. Their is no attempt on part of the assessee to avoid payment of legitimate taxes - no penalty levied. Demand of tax and interest upheld. Imposition of penalty withheld - petition disposed off - decided partly in favor of respondent.
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