TMI Blog2012 (12) TMI 402X X X X Extracts X X X X X X X X Extracts X X X X ..... thy, R.K. Jena and S.B. Jena for the Petitioner M.S. Raman, Additional Standing Counsel (Sales Tax) for the Respondent JUDGEMENT B.N. Mahapatra, J:- This writ petition has been filed with a prayer for quashing the order dated January 16, 2012 (annexure 1) passed by opposite party No. 2-Additional Commissioner of Sales Tax, North Zone, Banijyakar Bhawan, Buxibazar, Cuttack and the orders dated December 31, 2011 passed by the Sales Tax Officer, Vigilance, Sambalpur under annexures 9 and 10 on the ground that the said orders are illegal, arbitrary and contrary to the provisions of the Orissa Value Added Tax Act, 2004 (for short, "the VAT Act") and the Orissa Entry Tax Act, 1999 (for short, "the OET Act"). The petitioner's case in a nutshell is that he is the owner of a vehicle bearing No. CG-04-DB-5707, which was used by him for transport business. On December 16, 2011, the petitioner's vehicle carrying 230 metres of pipe proceeded from Macawber Beky Pvt. Ltd., Greater Nodia (U.P.) to M/s. Jindal Steel and Power Ltd., Angul, Odisha. The said consignment was covered with all valid required documents such as invoice No. 2172 dated December 16, 2011 for Rs. 16,81,965, E. w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d maintained only the imposition of penalty under the OVAT Act and OET Act made by opposite-party No. 4, Mr. T.K. Satapathy, learned counsel appearing for the petitioner, submitted that the order passed by opposite-party No. 2 is unjustified and untenable in the eye of law. Before opposite-party No. 4 passed the order of assessment, no due and proper opportunity was extended to the petitioner in the proceeding. Opposite-party No. 2 has erroneously created a new issue and levied penalty under the OVAT Act and OET Act. Consignment carried in the vehicle was accompanied by valid documents as required under section 74(2)(a) of the OVAT Act and the same were immediately produced before opposite-party No. 3 on spot. The petitioner has not contravened any provision of sub-section (2) of section 74 of the OVAT Act or submitted any false or forged documents to opposite-party No. 3 and the goods were covered by the e-way bill and as such the levy of tax and penalty under section 74(5) of the OVAT Act is without any authority of law. The petitioner has only committed a mistake for not entering into the check gate disclosed in the way-bill. Placing reliance on the judgment of the Madhya Prad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gate established on the route through which he entered into the State of Orissa. Placing reliance on the judgment of this court in the case of Singhal Converter (P) Ltd. v. Addl. Commissioner of Sales Tax, Orissa, Sambalpur reported in [2008] 18 VST 165 (Orissa), Mr. Raman argued that where the goods were carried clandestinely to evade tax, the officer-in-charge of the check-post is justified to levy penalty or both tax and penalty. Further placing reliance on the judgment of this court in Vinayak Agro Industry v. Commissioner of Commercial Taxes, Orissa, Cuttack [2012] 47 VST 191 (Orissa), it was submitted that in the present case the imposition of penalty under section 74(5) of the OVAT Act is justified. Placing reliance on the decision of the honourable Supreme Court in the case of Sales Tax Officer v. Dutta Traders [2007] 9 VST 425 (SC), Mr. Raman submitted that under section 16D of the Orissa Sales Tax Act, 1947 the Sales Tax Officer (Vigilance) has power not only to search and seize the documents, but also entitled to assess and recover the tax. On the rival contentions of the parties, the following questions fall for consideration by this court:- (i) Whether, in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that any of the conditions prescribed in that sub-section is satisfied. In other words, in order to exercise jurisdiction under section 74(5) of the OVAT Act, the prescribed authority must be satisfied that either of the two conditions mentioned therein is fulfilled and such power cannot be exercised on some suspicion or doubt. In the instant case, the Sales Tax Officer, Vigilance, after inspection of the goods in question and documents produced before him has issued show-cause notice under section 74(5) of the OVAT Act and under section 25 of the OET Act. Vide show-cause notice dated December 26, 2011 issued under section 74(5) of the OVAT Act, the petitioner was informed that on verification of the documents produced by the person-in-charge/driver of the goods vehicle, it was found that the petitioner has contravened the provisions of section 74(2)(b), (c), (d) of the OVAT Act, 2004. The petitioner was further asked to show-cause within seven days from the date of receipt of the order as to why tax and penalty under section 74(5) read with subsection (7) amounting to Rs. 4,03,674 shall not be imposed on the petitioner. Similarly, vide show-cause notice issued under section 25 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y No. 2-Additional Commissioner of Sales Tax, North Zone, Cuttack in their orders passed under annexures 9 and 10 and annexure 1, respectively, admitted that the petitioner has not violated the provisions of clause (a) of sub-section (2) of section 74 of the OVAT Act. It is also not the case of opposite-party No, 4 or opposite-party No. 2 that the petitioner has furnished false or forged documents or way-bill either covering the entire bill or part of the goods, carried in the vehicle. Opposite-party Nos. 2 and 4 have justified their action for imposing penalty under section 74(5) on the ground that, the petitioner violated the, provisions of .sub-sections (2)(b), (c), (d), (e) of section 74. But section 74(5) of the OVAT Act does not contemplate that the prescribed authority shall assume jurisdiction for imposition of penalty under the said section for contravention of the provisions of section 74(2) (b), (c), (d), (e) of the OVAT Act. While the Legislature in its wisdom has provided that only in case of violation of the provisions of clause (a) of sub-section (2) of section 74 or for, submission of false or forged documents or way-bill either covering the entire goods or part o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e words in their natural and ordinary sense. The words themselves alone do, in such case, best declare the intention of the lawgivers. The legal maxim, "A verb is legis non est recedendum" means from the words of law, there must be no departure. Therefore, when the language of the statute is plain and unambiguous, then court must give effect to the words used in the statute and it would not be open to the court to adopt a hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. The honourable Supreme Court in the case of Govind Impex Private Limited v. Appropriate Authority, Income-tax Department [2010] 330 ITR 10 (SC) ; [2011] 1 SCC 529, held that a penal statute which makes an act of penal offence or impose penalty is to be strictly construed and if two views are possible, one favourable to the citizen is to be ordinarily preferred. The High Court of Madhya Pradesh in the case of Indore-Kolhapur Roadlines [1994] 95 STC 141 (MP), held that once it is found that goods carried on a truck are accompanied by all the documents as are required under the law, no occasion for initiation of the proceedings for pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely said that the driver of the vehicle submitted false/forged documents/way-bills covering the entire goods carried in the vehicle which is a case of fraud and vitiated everything. In the present case, it is nobody's case that the goods carried in the vehicle was not covered by valid documents or that the person-in-charge of the vehicle has furnished false/forged way-bill/document. Therefore, the above cases relied upon by Mr. Raman are of no help to the Revenue. In view of the clear and unambiguous provision of sub-section (5) of section 74 and the proposition of law settled by the honourable Supreme Court, in the above referred cases we have no hesitation to hold that the Sales Tax Officer (Vigilance), Sambalpur (opposite-party No. 4) and the Additional Commissioner of Sales Tax, North Zone, Cuttack (opposite-party No. 2), have acted illegally and the orders passed under annexures 9 and 10 by opposite-party No. 4 imposing tax and penalty under the OVAT Act and OET Act and the order passed by opposite-party No. 2 under annexure 1 maintaining imposition of penalty made by opposite-party No. 4 are not legally sustainable. Therefore, the orders passed under annexures 1, 9 and 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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