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2016 (8) TMI 1114 - HC - VAT and Sales TaxLevy of penalty under the provisions of Section 13-A (4) of the U.P. Trade Tax Act 1948 - Held that:- Significantly neither the assessing authority nor for that matter the Tribunal return or record any finding as to whether the goods which were seized had not been accounted for in the books of accounts which were maintained by the assessee. As noted above, both the assessing authority as well as the Tribunal have primarily proceeded to consider a failure on the part of the assessee to establish how the raw material had entered into the State to be fatal to its case. The Tribunal as well as the assessing authority have also referred to inconsistencies in the pleas taken by the assessee in respect of the bills and gate passes under which the raw material is said to have entered into the State. The assessing authority as well as the Tribunal have permitted the introduction of considerations that were wholly irrelevant to the exercise of power under section 13A. The goods were shown to belong to a bona fide dealer. They were shown to have been duly entered in the books of accounts. How the raw material from which the goods were manufactured entered into the State was a wholly irrelevant consideration and clearly tainted the statutory enquiry beyond repair. Having embarked upon this exercise, in the opinion of this Court, both the assessing authority as well as the Tribunal completely misdirected the enquiry, which was liable to be undertaken under sub-section (4). It is on account of this approach that no findings have been entered by the Tribunal as to whether the goods had been duly accounted for by the assessee. The Tribunal, this Court notes, does not refer to any evidence nor records any reason to dispel what the first appellate authority recorded in his order namely that the goods had been duly recorded in the books of accounts of the assessee.
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