Forgot password
2017 (5) TMI 1541 - HC - VAT and Sales Tax
Penalty u/s 72(1) of KVAT Act - benefit of Kara-samadhana Scheme of 2017 - Held that - Clause 1.2 of the Scheme is crystal clear when it defines the terms arrears of penalty and interest means all kinds of penalties levied and all kinds of interest accrued under the provisions of the KST and CST Acts relating to all the assessment years ending on March 31 2005 up to March 31 2016. Obviously the said period will include the month of March 2015 the month in which there was a delay of 71 days in filing the returns by the petitioner. Thus respondent No. 3 is not justified in claiming that the petitioner is not entitled to the benefit of the Scheme. Respondent No. 3 is directed to accept the application filed by the petitioner in case it is filed prior to the closing of the office on May 31 2017 along with the payment of 10 per cent. of the penalty - petition disposed off.
Issues:
Challenge to penalty imposed under section 72(1) of the KVAT Act - Benefit of "Kara-samadhana Scheme of 2017" - Entitlement to waiver of penalty - Interpretation of relevant clauses of the Scheme - Pending case before the court affecting eligibility for Scheme benefits.
Analysis:
The petitioner, a registered dealer under the KVAT Act and CST Act, faced penalty proceedings for a 71-day delay in filing returns for March 2015. Despite requesting the benefit of the "Kara-samadhana Scheme of 2017" to drop the penalty, it was imposed by the Assistant Commissioner of Commercial Taxes (ACCT). The petitioner's subsequent efforts to rectify the penalty order were unsuccessful, leading to this petition before the court.
The petitioner argued that the Scheme covers "arrears of penalty and interest" and mandates payment of only 10% of the amount with the remaining 90% waived. The petitioner contended that the penalty should not apply, and the Scheme's benefits should be granted. The petitioner's counsel emphasized the urgency as the last date for submission under the Scheme was approaching, seeking a court directive for the respondent to accept and process the application in line with the Scheme.
The Additional Government Advocate for the respondents acknowledged the Scheme's provisions regarding penalty and interest arrears, requiring a 10% payment. However, he pointed out that pending cases filed by the assessee must be withdrawn for Scheme eligibility. As the present case was before the court, he argued against granting the Scheme benefits to the petitioner.
The court analyzed the Scheme's clauses, emphasizing that "arrears of penalty and interest" encompass penalties and interest under the KST and CST Acts up to March 31, 2016, including the petitioner's case from March 2015. It ruled that the petitioner was entitled to the Scheme benefits, directing the respondent to accept the application and 10% penalty payment by a specified deadline. The petitioner was instructed to personally submit the application, and the respondent was mandated to process it according to the Scheme, thereby disposing of the petition.