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VAT and Sales Tax - Case Laws
Showing 41 to 60 of 108 Records
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2016 (10) TMI 785
Tax liability - assessment proceedings - Entry tax - Best judgement assessment - tax evasion - survey of premises - rejection of books - discrepancies in the recorded quantities of raw material and finished products - entries in the RG-1 Register did not match with what was actually found during the course of the survey operations - Held that: - Section 28 of the Act empowers the assessing authority to reject the books of account of an assessee where it finds that the same are not worthy of credence. The provision when it empowers the assessing authority to reject the turnover of sales and purchases as declared casts a duty to come to a positive conclusion that the assessee is undertaking operations without all transactions being dutifully and faithfully recorded in the books of account. It is only when he comes to form an opinion that no credence at all can be laid upon the disclosures made by the assessee that the books of accounts are to be rejected - the authority must come to a conclusion that the books of accounts as maintained and as a whole cannot be relied upon or held worthy of confidence.
The difference itself was of only 0.67 per cent. This, in the opinion of the Court, did not form sufficient ground to come to a conclusion that the books maintained by the assessee were not worthy of credence or that the transactions were not faithfully or dutifully recorded in the account books. Pausing here, it becomes relevant to clarify that this Court does not intend to lay down as a broad proposition that a singular transaction cannot in all situations be sufficient to reject the books of account. There may be a case where the singular discrepancy may be of such vital import that it cannot be brushed aside or ignored. What would have to be necessarily be borne in mind is the significance of the infraction and whether the same is indicative or evidence of a deliberate attempt to suppress and conceal turnover.
Estimation of turnover - the Court finds that although the Tribunal accepts the submission of the revisionist that all the thirty eight machines were not functioning in May 2008, it has proceeded to estimate the escaped turnover to be ₹ 1,40,00,000/-. On what basis this figure has been arrived at is neither noted nor elaborated upon by the Tribunal. While it is true that a best judgment assessment would necessarily entail a certain degree of guess work, the guess itself which is arrived at by the authority must be fair, informed, intelligent and referable to some valid or cogent basis for arriving at the figure of escaped turnover. It can neither be arbitrary, fanciful or based wholly on conjecture. For the purposes of arriving at the figure of escaped turnover to be ₹ 1,40,00,000/-, the Tribunal neither refers to the scale of operations in the succeeding months nor does it rest its estimation upon any material or contemporaneous record which may have been found in the course of the survey operations. On both scores, therefore, this Court is unable to sustain the orders passed by the assessing authority as well as the Tribunal.
The assessment under the Entry Tax enactment is based solely upon the assessment undertaken under the Act. For the reasons recorded above, the same must also necessarily fall.
Revision allowed - decided in favor of assessee.
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2016 (10) TMI 784
Courier service provider - logistics Agreement - inspection of premises - presence of various goods which had not entered the State of U.P on the strength of certain Forms 38/39 - seizure of goods - power of seizure - Held that: - The power to seize goods is not dependent upon the bonafides or characteristics of a past transaction or perceived course of business. It has to be necessarily exercised in the backdrop of whether the goods which are being seized fall within the mischief of Section 48 or not.
Whether the sales were liable to be treated as inter-State sales? - Held that: - What appears to have weighed with the Tribunal is the fact that the payment for the goods was made within the State. What the Tribunal clearly lost sight of and unjustifiably chose to ignore was its own record wherein it was admitted that the goods in question had come from outside the State of U.P. The Tribunal in its entire order nowhere places reliance or refers to any material which may have cast a shadow of doubt on the said recital which stood recorded in the course of the initial seizure proceedings. Further, the view taken by the Tribunal to the effect that the sale would stand completed only upon the payment for the goods and that the payment of price would be determinative of the issue would also, in the opinion of this Court, appear to be an issue which may not be free from debate. This Court however refrains from commenting further on this aspect. The caveat which stands entered above is primarily on account of the fact that in the opinion of this Court there was no occasion for the Tribunal to have ruled upon this aspect of the matter at all, the proceedings themselves being confined to the validity of seizure. This Court therefore without commenting any further on this aspect refrains from returning or entering any finding which may prejudice the rights and contentions of either of the parties - seizure quashed - revision allowed - decided in favor of revisionist.
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2016 (10) TMI 783
Assessment for the years 2005-06 and 2006-07 - dealer in iron and steel - goods purchased from Punjab and then consigned to U.P. - circular referable to the provisions of Section 8-C (3) (a) of the U.P. Trade Tax Act - the importers of steel to furnish security before obtaining the requisite import declaration forms - Held that: - While the order of assessment itself carries a recital to the effect that the statement of accounts and relevant books had been produced and upon enquiry it was found that the sales and purchases had been correctly reflected and accounted for therein, the assessing authority curiously then proceeded to record that only computerized accounts were produced for his consideration. Obviously, the two are self contradictory. The Tribunal has also proceeded on the basis that the assessing authority had not recorded any satisfaction in respect of the transactions having been duly accounted for in the relevant books of accounts. It is on this basis that it has proceeded to hold that the assessing authority was clearly justified in rejecting the books of accounts. The Court then further finds that in both the assessment years, the amount of escaped turnover has been increased without reference to any material or record in support thereof. While it is true that a best assessment judgment undertaken by the assessing authority would necessarily entail a certain degree of guess work, the same cannot be used as a licence by the assessing authority to not base his estimation on any material at all. The guess work which needs to be employed in such circumstances, must obviously be reasoned and referable to some empirical or contemporaneous material that exists or may be found by the assessing authority. The exercise, in the opinion of this Court, so undertaken by the assessing authority cannot depart from being one which is logical and fair - issue of rejection of books of account as well as estimation of actual turnover merits Remand - matter remanded.
Levy of penalty - this court finds that the circular of the Commissioner by itself made a provision for situations like the present which stand raised in these revisions. The circular itself envisages a situation where an importing dealer incorrectly computes the security which was liable to be paid on the goods. It accordingly granted him the facility of depositing the balance amount due and payable at the time of entry of goods at the check post. The short fall if any in deposit of security was also liable to be taken into consideration while computing the ultimate tax liability of the assessee and while arriving at the correct figures of taxable turnover. The difference itself as has been pointed out by the learned counsel for the revisionist worked out to ₹ 200/- per metric ton and as per Sri Agrawal would have resulted in a liability of not more than ₹ 262/-. This being the only ground and reason which weighed with the assessing authority for levying penalty upon the revisionist cannot be sustained. The orders imposing penalty are therefore liable to be set aside.
Revision allowed - assessment proceedings remanded - levy of penalty decided in favor of revisionist - decided partly in favor of revisionist.
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2016 (10) TMI 782
Change of constitution of the firm - business of father carried on by son, when father died, without intimation to Department - input credit taken by son reversed and order of assessment made on son on the ground that the fact of father's death and business carried on by son was not intimated to Department and fresh registration not obtained - Held that: - the mistake committed by the dealer can be treated only as an irregularity and not an illegality. Rule 5(3) of the said Rules states that whenever there is a change in constitution of the business of the dealer, the said dealer, within 30 days from the date of change in constitution, shall furnish details of the change to the Registering Authority and the Registering Authority, on satisfying itself, shall amend the certificate of registration accordingly - As rightly pointed out by the learned counsel for the petitioner, the Rule does not contemplate the consequences for non furnishing of information pertaining to change in constitution. The question would be as to whether all the transactions done during the interregnum could be invalidated for such a reason.
As non furnishing of information, as required under Rule 5(3) of the said Rules, does not contemplate a situation to disbelieve all transactions especially transactions as done in the present case, the impugned orders reversing the input tax credit are wholly unsustainable. The respondent does not take a stand that on account of the non intimation, the registration has been canceled nor any such step has been taken. The interpretation is that on the demise of the father of the present proprietor of the petitioner, the registration becomes infructuous. This Court is not convinced with such a stand taken by the respondent, especially when even prior to the demise of the father of the present proprietor of the petitioner, the business was reconstituted as a partnership firm and it was recognized by their principal - M/s.Indian Oil Corporation Limited.
The mistake committed by the petitioner can be treated only as an illegality, for which, a capital punishment cannot be imposed on the dealer. Furthermore, it is stated that a fresh registration has been granted in the name of the present proprietor of the petitioner on 25.6.2015 and only for the two assessment years, this problem has arisen. Therefore, this Court, exercising its extraordinary jurisdiction, is convinced to state that the reason for reversing the input tax credit, as done in the impugned orders, is not sustainable - petition allowed - decided in favor of petitioner.
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2016 (10) TMI 751
Offences punishable under Sections 406, 409, 420, 467, 468, 471, 474 and 120(B) of the Indian Penal Code and Sections 85(1)(b)(c) (e)(f)(g), 85(2)(g), 85(4) and 85(6) of the Gujarat Value Added Tax Act, 2003 - scope of application - refusal/grant of protection to applicants - Held that: - Since the scope of these applications is grant / refusal of protection to these two applicants, wider issues are not gone into by this Court. It is left only by observing that - on one hand, there is very serious narration in the complaint against the Company viz. Dharmpal Satyapal Ltd., quantifying the alleged fraud to the tune of approximately two hundred crores of rupees, the Directors and other responsible persons of the said company are accused Nos.1 to 9 in the FIR in question and still, not only there is no motivation on the part of the State to bring them to justice, but there is complete facilitation qua them at their terms. It is for the State to take a call. Suffice it to hold that the present applicants need to be protected against this exercise of powers by the State and the investigating agency. These applications therefore need to be allowed.
It is also noted that, pursuant to the interim order of this Court, the questioning of these applicants is already done by the Authorities. Considering the totality this Court finds that, custodial interrogation of the applicants is not required. Their judicial custody would also not be required in the facts of the case. These applicants therefore need to be granted anticipatory bail by this Court.
Application allowed - applicants released on bail on furnishing personal bonds of ₹ 10,000/- each and one surety of the like amount subject to some conditions.
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2016 (10) TMI 750
Restoration of appeal - pre-deposit to hear the appeal - refund of amount by petitioner - 31.78 crores after giving credit to the tax amounts already deposited by the petitioner - Held that: - There may be some minor adjustment or a computation error in the authority arriving at such a figure. Nevertheless, it would not be possible to undertake entire assessment exercise to arrive at a figure with mathematical precession, nor would it be necessary. When the Tribunal has granted benefit of setting aside of assessment leading to tax demands worth hundreds of crores, least that was accepted of the petitioner was to refund that sum, which primafacie, the petitioner had received by way of refund of tax which was based on fake invoices. The Tribunal was perfectly justified in discarding the petitioner's defense that it was the employees of the firm who had carried out such fraud for which they were punished. The Tribunal noted that the firm received the refund based on such fake invoices and input tax credit. Fresh assessment may proceed. The same however cannot be by allowing the petitioner to retain the refund amount. When the Tribunal has imposed a condition of predeposit of ₹ 10 crores by way of condition to hear the Tax Appeal on merits and when the Tribunal had also granted sufficient time to deposit such amounts in installments, in facts of the present case, we see no reason to interfere - We had adjourned this petition on few occasions to enable the counsel for the petitioner to take instructions and to show in what manner the petitioner can even now deposit such sum. Barring pointing out that the department has attached petitioner's shares, of which the current value comes to ₹ 5.02 crores which the department may sell, the petitioner was unable to offer any further amount by way of predeposit. - petition dismissed.
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2016 (10) TMI 749
Eligibility for refund of tax paid on the purchase of inputs - items required for the establishment of the plant and for its incidental purpose - connection of electronic gadgets or drinking water with the development activity of the unit concerned - Rule 130- A of the Rules - Held that: - the Tribunal has taken note of only clause (b) of sub-rule (1) of Rule 130-A namely that; setting up, operation or maintenance. Apart from the said aspect as already reproduced earlier clause (c) of Rule 130-A (1) speaks for all such inputs which are purchased for use in manufacture, trading, production, processing, assembling, repairing, reconditioning, reengineering or packing any unit located in the area of Special Economic Zone. In our view, aforesaid clause (c) of Rule 130-A (1) is wide enough for all activity of manufacture or trading or production or processing or assembling or repairing or packing and all such incidental purchases for the principal object of manufacture or trading or production or processing or assembling or repairing or reconditioning or reengineering or packing would get included for the purpose of input tax credit or refund of tax, as the case may be. When the rule itself is clear, coupled with the observations made by the Tribunal under the impugned order, we do not find any question of law would arise for consideration as sought to be canvassed.
Items of the electronic gadgets or mobile or drinking water are required for the incidental activity of the principle object of manufacture or trading or production or processing or assembling or repairing or reconditioning or reengineering or packing. Hence, such would fall in the category of availability of input tax credit under Rule 130 –A of the Rules.
Matter remanded to the assessing authority - petition dismissed.
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2016 (10) TMI 748
Recovery of input tax credit - imposition of penalty u/s.27[4][a] of the TNVAT Act, 2006 - denial of input tax credit on the goods purchased from M/s.AMI Enterprises on the ground that M/s.AMI Enterprises have filed NIL returns, thereby alleging that no sales made by M/s.AMI Enterprises - petitioner while producing prove presented original purchase documents and also stated that M/s.AMI Enterprises have filed revised return and also enclosed copies of the revised returns submitted by the Selling Dealer to his Assessing Officer - whether denial of input tax credit on the ground that selling dealer filed NIL returns valid? - Held that: - decision in the case of Althaf Shoes (P) Ltd. Versus Assistant Commissioner (CT), Valluvarkottam Assessment Circle, Chennai-6 [2011 (10) TMI 567 - Madras High Court] relied upon where it was held that if the Selling Dealer has not collected tax, that liability has to be fastened on the Selling Dealer. That apart, merely because the Selling Dealer had filed incorrect particulars, will not be a reason to reverse the ITC availed by the Purchasing Dealer.
Opportunity of being heard - in the notice dated 08.07.2016, the respondent stated that the petitioner can file objections to the notice and they will be heard in person at his office at 11.30 a.m. on any working days from within 15 days from the date of receipt of the notice. This Court is of the view that the wordings mentioned in the notice dated 08.07.2016 is not proper since after the objection is received, there may be cases where the Assessing Officer will be fully convinced with the objections and he may even drop the proposal. - Held that: - the proper thing for the officer would be to specifically fix the date for personal hearing after receipt of the objections and after going through the same.
Rejection of the revised return filed by the Selling Dealer before his Assessing Officer - Held that: - the respondent is not the Assessing Officer of the Selling Dealer. Therefore, he has no jurisdiction to reject the revised return filed by the Selling Dealer as an after-thought. If at all it can be done only by the Assessing Officer of the Selling Dealer.
Petition allowed - matter remanded to the respondent for fresh consideration who shall ascertain full particulars from the Assessing Officer of the Selling Dealer, viz., M/s.AMI Enterprises, and thereafter, put the petitioner on notice, invite their objections, hear them in person and re-do the assessment in accordance with law.
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2016 (10) TMI 747
Validity of assessment order - TNVAT Act, 2006 - CST Act - inspection of premises of petitioner by the officials of the Enforcement Wing - It is not a case where the petitioner is not able to furnish details. But, the petitioner has furnished the details which have been brushed aside by the respondent while completing the assessment. This is evident from the stand taken in the counter affidavit - Held that: - the petitioner has produced the relevant documents at the time of personal hearing but, the respondent has stated that the records produced by the petitioner are insufficient to establish the genuineness of the transactions. If that is the stand taken by the respondent, then, there was a duty cast upon the respondent to discuss about the nature of the documents produced by the petitioner and how he proposes to disbelieve those documents as to whether all the documents are liable to be rejected, etc.
At one point of time, part of the transactions have been recognised by the respondent Department. The transaction made by the petitioner to a company at Sriperumbudur is not disbelieved at the hands of the purchasing dealer. In such circumstances, the respondent appears to have not conducted a thorough enquiry in to the matter, as it appears that the documents are voluminous and in a summary manner, the assessment was done for the 7 assessment years.
With regard to the turn over omission, which appears for all the assessment years, the petitioner has stated before the Enforcement Wing Officials themselves that they are unable to cull out the details from bare perusal of the figures. Therefore, even after the issuance of show cause notice, while submitting their reply they sought for details such as Bill number etc - Even this request has been rejected by the Assessment officer, as an after thought. Since, the respondent has already initiated action, he is bound to conduct a thorough and complete enquiry into the matter and any slipshot or cursory perusal of the documents cannot be appreciated since, the proceedings are under a taxation statue.
The impugned assessment has to be done in a proper manner after considering all the documents to be submitted by the petitioner. The petitioner shall be furnished the documents sought for and the petitioner is also entitled to produce the books of accounts, etc. - petition allowed - matter remanded.
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2016 (10) TMI 721
Imposition of penalty - Cyclic Hydrocarbons (Marker) - stock transfers - transported from NOIDA to Lucknow - Form-31 in terms of Section 28A of the U.P. Trade Tax Act, 1948 Act - violation of Section 15-A(1)(o) of the 1948 Act - Held that: - the goods were seized during the course of their transit, as per the assessee, from Noida to Lucknow. The assessee had before the authorities admittedly submitted the GR and Stock Transfer Invoices which had accompanied the goods. It is also not disputed by the department that the OC stamp was present along with the documentation which accompanied the goods in question. The allegedly failure on the part of the assessee to deposit the Stock Transfer Invoices dated 16 November 2006 within twenty four hours or at least till 21 November 2006 would neither be determinative nor conclusive insofar as the issue of an intent to evade the payment of tax is concerned.
The mere statement of the driver that the goods had in fact been loaded at Delhi and were bound for Lucknow did not in the opinion of this Court conclusively lead one to the conclusion that the transportation was being effected in an attempt to evade assessment or payment of tax. The mere absence of a Form-31 not being fatal to the case of the assessee - penalty not justified.
Order of assessment - Held that: - the assessment was based entirely upon the levy of penalty upon the assessee on two occasions. The levy of penalty which formed the subject matter of Second Appeal No. 507/2011 stood anulled by the Tribunal itself. The levy of penalty has been found by this Court to be unsustainable. Since the estimation admittedly was not based on any other material the addition to the declared turnover of the assessee and levy of additional tax also must therefore necessarily fail.
Revision allowed - decided in favor of assessee.
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2016 (10) TMI 720
Taxability of a Car Stereo System - "electronic goods" falling under Entry 75 or "motor vehicle falling under Entry 18 - Whether a Car Stereo System was liable to be taxed under Entry 75 of a Notification dated 13 December 2002 or whether it was liable to be classified and taxed on the basis of it falling under Entry 18 of the Notification dated 29 January 2001 as amended and reiterated vide Notification dated 9 May 2003? - whether a car stereo is liable to be viewed as an accessory to a motor vehicle? - Held that: - A car stereo is undoubtedly available as an article in an automobile market or shop or a place of manufacture. The Tribunal noted that in many cases a car stereo is either pre-fitted in a motor vehicle and in other instances fitted subsequently. A car stereo, in the opinion of this Court, would therefore be liable to be treated as an accessory. It cannot be gainsaid that a car stereo does add to the comfort for the use of a motor vehicle. It enables a driver undertaking a long journey to enjoy the ride and makes the trip pleasurable. Viewed in this sense, it must be held to be an article which adds to the comfort for the use of the motor vehicle. In view of the above, whether the Court applies the comfort test or whether it applies the test of whether an article can be said to be available for sale in an automobile market, on both scores, the car stereo held as an accessory.
The entry of "accessories" was placed specifically in the company of and under the heading of motor vehicles. The other competing entry upon which reliance was placed was of microwave ovens and all other electronic goods "not specified anywhere else". Even if a car stereo be viewed as "electronic goods", they would stand comprised in Entry 18 by virtue of being an accessory to a motor vehicle. They were in this sense,though electronic goods, but since specified elsewhere they would stand excluded and extracted from Entry 75 - car stereo held as accessory - revision application dismissed - decided in favor of Revenue.
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2016 (10) TMI 719
Demand of duty - Exemption on polished granite stone on the basis that polished granite stones were produced from out of the tax suffered from rough granite blocks - Revisions under Section 12-A(1) - If a polished granite stone is used in a building for any purpose, it will come under Entry 17(i) of Part S of the second schedule, but if it is a tile, which comes into existence by different process, a new and distinct commodity emerges and it has a different commercial identity in the market - Held that: - if a polished granite which is a slab and used on the floor, it cannot be called a tile for the purpose of coming within the ambit and sweep of Entry 8. Some other process has to be undertaken. If tiles are manufactured or produced after undertaking some other activities, the position would be different - Decided in favor of revenue.
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2016 (10) TMI 660
Scope of taxable turnover - whether the market fee or cess which is paid by the petitioner is in the nature of compensation for the special services rendered by the market committee and there must be quid pro quo for the services rendered by the Government or local body and such pre-expenses levied in rendering service by the market committee forms part of the taxable turnover for the purpose of levying tax and as such expenses are liable to be deducted from the total turn over? - Madras Sugar Factories Control Act, 1949 - Held that: - the nature and incidence of cess was not intended to form part of the consideration for the purchase of sugar by the assessee therein. The said principle could very well be applied to the case on hand, since the petitioner had paid the fee or cess to the regulated market committee which renders certain services to the seller and the purchaser. In other words, the market committee acts as a facilitator for which a fee is collected - fee/cess paid by the petitioner to the market committee cannot form part of the taxable turn over nor made liable to tax - petition allowed - decided in favor of petitioner.
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2016 (10) TMI 659
Power of Designated Officer, Tamil Nadu Food Protection and Drugs, Administration Department, Karur District to lock and seal a premise - search of premises and taking of samples without consent without any prior notice and due opportunity to petitioner - petitioner, a valid holder of licence to trade edible, non edible oil, fatty acids, waste gum, soap oils, rice brand oil, glycerin and rice brand oil gum - Section 38(1) to (6) of the Food Safety and Standards Act, 2006 - Held that: - Rule 2.1.3(4) speaks of Powers and Duties of the Food Safety Rules, in and by which, where the Food Safety Officer is of the opinion or he has reason to be recorded in writing, in the given situation, it is not possible to comply with the provision of section 38(1)(c) or the proviso to section 38(1) for reasons like non availability of the Food Business Operator, the Food Safety Officers may seize the adulterant or food, which is unsafe or sub-standard or mis-branded or containing extraneous matter, may seal the premises for investigation after taking a sample of such adulterant or food for analysis.
The Designated Officer, Tamil Nadu Food Safety and Drugs, Administration Department had issued a notice to the petitioner on 31.03.2016 to produced the purchase and sales bills of raw materials purchased and the same was received by the petitioner on 02.04.2016 and till date, the petitioner/company had not produced the relevant documents to establish or to prove their Bonafide Transaction/action, the Court is of the considered view that the present writ petition filed by the writ petitioner is a premature and otiose one - petition disposed off - Designated Officer, Tamil Nadu Food Safety and Drugs, Administration Department, Karur, allowed to carry on necessary proceedings - decided against petitioner.
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2016 (10) TMI 658
Exemption from payment of tax - Bihar Vat - Branch transfers / stock transfer - form “F” - whether in the absence of Form "F", the petitioner can be given credit on the basis of other documents of transaction which may support the transfer of the goods from State of Bihar to State of Jharkhand? - Held that: - the requirement of Form “F” in terms of CST Act cannot be substituted with other documents in support of proof of transactions from one branch of the petitioner in the State of Bihar to the State of Jharkhand. If the law requires a particular thing to be done in a particular manner, it can be done in that manner alone. The requirement is that such transfer will be exempt from payment of tax on furnishing of Form "F". Therefore, unless the Form “F” is furnished, the petitioner would not be entitled to any tax credit. The petitioner cannot rely upon other documents of transactions in support of its plea of Branch transfer - petition dismissed - decided against petitioner.
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2016 (10) TMI 638
Demand of arrears of sales tax - TNGST Act, 1959 - CST Act, 1956 - sick industrial company - protection u/s 22(1) of the SICA - principles of natural justice - Held that: - the Special Tribunal took into consideration of the submissions of the petitioner and shifted the burden on the petitioner to produce proof to the Department that proceedings are pending before BIFR and also to show the proof as to whether any Scheme has been framed and if the petitioner was not successful in doing so, liberty was granted to the Department to Act in accordance with law. It is not known as to the outcome of the direction issued by the Special Tribunal and as to whether any orders were passed subsequently or whether the order of the Tribunal was challenged.
The petitioner has a duty to bring it to the notice of the AO about the pendency of any proceedings before the BIFR. Therefore, at this juncture, the impugned notice cannot be quashed. However, with a view to afford an opportunity to the petitioner, the respondent is directed to keep the notice impugned in this Writ Petition in abeyance for a period of six weeks - petition disposed off.
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2016 (10) TMI 637
Levy of penalty at 30% of the value of goods u/s 77(8) of RST Act - survey - compliance of Rule 50 - whether DC(A) was justified in deleting the penalty on the ground that compliance under Rule 50 has not been made? - compliance under rule 50 mandatory or otherwise - Held that: - The rule envisages that the Authorized Officers who carries out search u/Sec. 77 of the Act, shall adopt the procedure prescribed under Rule 50 and the word used is 'shall' therefore, it should be followed in letter and in spirit. Admittedly, on perusal of the two appellate orders, it transpires that there was no witnesses present and only statement of the Director was recorded and therefore since there is no compliance of Rule 50, the penalty was rightly deleted by the DC(A) and upheld by the Tax Board.
The goods were excisable and not only the excise duty but the sales tax @ 4% was also charged in the bill - no reason to interfere with the order of deletion of penalty - petition dismissed - decided in favor of respondent-assessee.
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2016 (10) TMI 603
Provisional attachment of bank account - section 45(1) of the GVAT Act, 2005 - entry tax - whether the Entry Tax Act, 2004 vest power of provisional attachment on the respondents? - Held that: - The Entry Tax Act does not contain any provision for provisional attachment. Section 45(1) of the VAT Act, of course, authorizes the competent authority to exercise the power of provisional attachment pending the proceedings for assessment or reassessment of turnover escaping assessment to protect the interest of Revenue. Such power obviously cannot be imported for the purpose of the Entry Tax Act.
The petitioner has already deposited a sum of ₹ 11 lakhs towards the initial estimated tax penalty and interest liability of ₹ 20 lakhs, which in any case, includes substantial portion of disputed entry tax - the authorities not permitted to provisionally attach the petitioner's bank account - petition allowed - decided in favor of petitioner.
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2016 (10) TMI 602
Demand of tax - printed digital photo albums - the issue had already been decided as per clarification issued by the Commissioner - non-consideration of clarification by the AO when considering the issue - whether the demand can be set aside by this Court bypassing the alternate remedy available under the statute? - order of demand passed without reference to the clarification sustainable? - Held that: - it is apparent that when a clarification had been issued under Section 94 of the Act, the Officer is bound to comply with the same. Merely for the reason that the petitioner had submitted an application for compounding which had been allowed, does not deprive the right of the petitioner to take a contention based on a clarification issued by the Commissioner. Under such circumstances, the Assessing Officer had committed serious error of law in coming to the aforesaid finding and for that reason itself, the impugned order is liable to be set aside - demand of tax set aside - AO to consider the matter afresh after taking note of the consideration and after hearing the petitioner - petition disposed off - decided in favor of petitioner.
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2016 (10) TMI 601
Levy of penalty u/s 27[3] of the TNVAT Act, 2006 - evasion of sales tax on purchase of earth - Held that: - the decision in the case of Commissioner of Income-Tax, West Bengal And Another Versus Anwar Ali [1970 (4) TMI 1 - SUPREME Court] relied upon where it was held that the true nature of penalty is understood to provide for a deterrent element against possible recurrence of default on the part of the assessees and hence, any order imposing penalty is the end result of a quasi-criminal proceedings.
Section 27[3] enables a penalty to be levied wherever a revision of assessment has taken place, pursuant to detection of a portion of turnover that has escaped taxation - there is no dispute on the factual ground that the payment made is in fact reflected in the books of accounts maintained by the respondent dealer in the ordinary course of business, and thus, there is no wilful suppression of any such expenditure, indulged in by the dealer. At the first round of assessment, in fact it has escaped the attention of the AO. In other words, no serious exception has been taken thereto at the first instance. But, it is subsequent thereto, the scrutiny has been undertaken.
There should have been a specific finding recorded by the AO that the turnover that has escaped in the first and initial round of assessment, is the result of wilful non-disclosure or suppression by the dealer. There is no such finding recorded in the Revised Assessment Order dated 30.11.2012. A proper and careful quasi-criminal exercise of imposition of penalty has not been carried out by the AO. The finding of wilful non-disclosure/suppression of turnover is the condition precedent, which alone fetches the imposition of penalty is conspicuous by its absence in the order of reassessment. In the absence of any such finding, imposition of penalty could not be lawfully carried out.
Petition dismissed - deletion of penalty justified - decided in favor of respondent-assessee.
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