2018 (4) TMI 50 - HC - VAT and Sales Tax

Time limitation - whether Karnataka Appellate Tribunal is right in law even though e-sugam produced by the Respondent at the time of interception is beyond the time prescribed in the Notification issued by the Commissioner of Commercial Taxes u/s 53(2-A) of the KVAT Act? - Held that - It is not a case in which goods were being transported without an e-sugam. The assessee had obtained e-sugam but it had expired. The cause shown is reasonable - Admittedly goods were indented from Gujarat. They reached Penambur Port on 27.12.2012. Customs formalities were completed on 31.12.2012. The tile limitation has been adhered to - petition dismissed - decided against Revenue-petitioner.

Summary

Issues:
Challenge to order of Karnataka Appellate Tribunal regarding expired e-sugam and penalty under Section 53(12) of KVAT Act, 2003.

Analysis:
1. The Sales Tax Revision Petition was filed by the State challenging the Karnataka Appellate Tribunal's order regarding the expired e-sugam and penalty imposition under Section 53(12) of the KVAT Act, 2003. The questions raised for consideration were whether the Tribunal was right in allowing the appeal and if the e-sugam produced beyond the prescribed time was lawful.

2. The case involved an assessee who ordered ceramic glazed tiles from Gujarat, with the goods reaching Mangaluru Port on 27.12.2012. Customs clearance was completed on 31.12.2012. However, the vehicle carrying the tiles was intercepted on 3.1.2013, leading to the issue of the expired e-sugam.

3. The Commercial Tax Officer proposed a penalty under Section 53(12) of the KVAT Act, 2003, due to the expired e-sugam, which was challenged by the assessee before the Joint Commissioner of Commercial Taxes(Appeals) and the Karnataka Appellate Tribunal.

4. The Karnataka Appellate Tribunal considered the cause shown by the assessee for carrying goods under an expired e-sugam. The Tribunal analyzed various judicial interpretations and found the cause satisfactory, setting aside the penalty imposed by the Commercial Tax Officer.

5. The Tribunal observed that the delay in transshipment was due to unforeseeable events like bad weather, beyond the assessee's control. The explanation provided by the assessee was accepted, leading to the Tribunal overturning the order of the first appellate Authority.

6. The High Court noted that the case revolved around the factual matrix and the reasonableness of the cause shown by the assessee for carrying goods with an expired e-sugam. As the assessee had obtained the e-sugam, albeit expired, the Court concurred with the Karnataka Appellate Tribunal's decision.

7. Consequently, the High Court dismissed the revision petition, emphasizing that the entire case was based on factual circumstances and the reasonableness of the cause shown by the assessee for the expired e-sugam. No costs were awarded in the matter.