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2021 (1) TMI 245 - HC - VAT and Sales TaxLevy of Penalty under Section 12-A(1-A) of Karnataka Sales Tax Act, 1957 - activity of construction of flats / apartments - works contract entered into prior to commencement of the construction - HELD THAT:- From perusal of the order passed by the tribunal, it is evident that in paragraph 10, no particulars of sale agreements alleged to have executed by the petitioner prior to commencement of the work has been mentioned, even though the schedule of payment has been mentioned. The aforesaid finding recorded by the tribunal is based on without any material on record - Similarly, there was no material on record either before the first appellate authority or the adjudicating authority to establish the fact that petitioner has entered into an agreement with prospective buyers prior to commencement of the construction. Therefore, the aforesaid finding has to be termed as perverse. Since, in the relevant Assessment Years the position of law was not clear and therefore, failure of the petitioner to disclose the turnover has to be termed as bonafide based on the prevalent position of law and in the aforesaid factual background, the penal provisions levying penalty could not have been invoked by the authorities. Reliance can be placed in the case of EID. PARRY (I) LTD. & OTHERS VERSUS ASSISTANT COMMISSIONER OF COMMERCIAL TAXES AND ANOTHER [1999 (12) TMI 708 - SUPREME COURT]. The impugned orders passed by the tribunal as well as first appellate authority levying Penalty under Section 12 A(1-A) of the Act are quashed - Revision allowed.
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