Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2024 (1) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (1) TMI 668 - HC - VAT and Sales TaxSeeking issuance of issuance of a writ of certiorari - calling for the records leading to Exhibits P7, P8 & P9 orders issued by the 3rd respondent - seeking to declare that the "Multi-Function Printer" traded by the petitioner, falls under Entry 69(22)(c)(i) of the 3rd Schedule to the KVAT Act, 2003, attracting tax @ 4%/5% as applicable in the respective year - penalties - HELD THAT:- It is not in dispute that the Customs authorities had accepted classification of the machines under HSN Code 8443 3100 under the head 'Digital Multifunctional Device' under the provisions of the Customs Act and the Customs Tariff Act, which is corresponding to Entry 69(22) (c)(i) of the Third Schedule to the KVAT Act. The importer-seller itself had classified the said products under Entry 69(22)(c)(i) of the Third Schedule to the KVAT Act with HSN Code 8443 3100 under the Customs Act and the Customs Tariff Act. When the importer-seller had classified its machine under HSN Code 8443 3100, which falls under Chapter 84 of the Customs Tariff Act corresponding to Entry 69(22)(c)(i) of the Third Schedule to the KVAT Act, the petitioners herein being re-sellers of the machines purchased from the importer-seller could not adopt a different classification. In the present cases, when the importer- seller had classified the said machines as 'Digital Multifunctional Devices' with HSN Code 8443 3100 under the provisions of the Customs Act, 1962 and the Customs Tariff Act, 1975 at the time of import and the said HSN Code is identical to Entry 69(22)(c)(i) of the Third Schedule to the KVAT Act, the petitioners cannot be said to have wilfully classified the machines under a wrong head with the intention to evade payment of correct/higher rate of tax at 13.5%. The penalty proceedings has to be initiated when there is wilful or contumacious act on the part of the assessee to evade payment of correct tax. The petitioners had reason to adopt the said classification as 'Digital Multifunctional Devices', as they being re-sellers could not have classified the machines to a different classification. The initiation of penalty proceedings against the petitioners are not justified and therefore, the penalty orders impugned in these cases are hereby set aside. Petition allowed.
|