TMI Blog2012 (2) TMI 447X X X X Extracts X X X X X X X X Extracts X X X X ..... been paid. In these circumstances, the imposition of penalty by invoking the provisions of section 22(2)(i) of the Act is unwarranted. Hence, the substantial question of law raised in the revision is answered in favour of the assessee. - Tax Case (Revision) No. 1487 of 2006 - - - Dated:- 9-2-2012 - MURUGESAN D. AND JANARTHANARAJA P.P.S., JJ. The order of the court was made by D. MURUGESAN J.- This tax case revision is at the instance of the assessee being aggrieved by the order of the Tamil Nadu Sales Tax Appellate Tribunal dated March 5, 1999 made in T.A. No. 702 of 1996. 2. The facts given rise to the present revision are as follows: The assessee is the dealer in food and drinks, doing business at No. 89, Bangalore Trunk Road, Thirumazhisai, Chennai. The assessment year in question is 1993-94. The assessee had reported a total and taxable turnover of ₹ 12,26,584.19 and ₹ 11,16,854.51 in the monthly returns. The accounts were called and checked and it was noticed that on January 23, 1994, there was a change in the constitution and the assessee did not file an application for registration within 30 days. For that reason, the assessing officer invoked th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nuary 23, 1994. Every dealer carrying on business before the commencement of the Act, or commencing business after the commencement of the Act, whose total turnover is ₹ 3 lakhs in any year, shall unless be exempted under section 20(2AA)(i) submit to the registering authority of the area in which his principal place of business is situated an application for registration within thirty days of his total turnover reaching ₹ 3 lakhs. This requirement is on the basis of rule 24(1) of the Tamil Nadu General Sales Tax Rules. In terms of rule 23(3)(ii), a successor in business or part thereof shall make an application for registration within 30 days of the date on which he succeeds to the business thereof. Rule 24(8A) contemplates that a certificate of registration be issued or deemed to have been issued under sub-rule (8). If such an application is made, the registering authority shall issue, within 30 days from the date of receipt of the application, a certificate of registration in form D1 as per rule 24(8). The said rule also contemplates a deeming provision. In the event, the certificate of registration is not received form the registering authority, it is deemed that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period of 30 days from January 23, 1994, i.e., on or before February 23, 1994. Admittedly, the said application was made on February 24, 1994, i.e., one day after the last date. In these circumstances, the provisions of section 24(8A)(b) cannot be pressed into service for a deeming clause, namely, the certificate should have been granted from the date on which the assessee has succeeded to the business. 5. Nevertheless, the said provision has to be considered with reference to section 22(2) of the Act as well. Section 22(1) and 22(2) read as follows : 22. Collection of tax by dealer.-(1) No person who is not a registered dealer shall collect any amount by way of tax or purporting to be by way of tax under this Act, and no registered dealer shall make any such collection except in accordance with the provisions of this Act and the Rules made thereunder: Provided that, nothing in this sub-section shall apply to the collection of an amount by a registered dealer towards the amount of tax already suffered under this Act, in respect of goods, the sale or purchase price of which is controlled by any law in force. Explanation.-For the purposes of this sub-section, any State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llection in contravention of the provisions of subsection (1) of section 22 by any person, namely, the assessee, again the said 100 per cent or 150 per cent, as the case may be, would be the penalty. 8. The question is, when the provision employs the word may , whether the above imposition of penalty would be automatic. The contention of the learned counsel appearing for the assessee is that there was a bona fide belief on the part of the assessee in not applying for registration within 30 days and therefore, the authorities below should have considered the explanation offered in view of the discretion vested on them in not imposing penalty in a given case. On the other hand, it is the contention of the learned counsel appearing for the Revenue that the provisions of section 22(2) are mandatory when it is established that the tax had been collected in contravention of the provisions of section 22(1). 9. It is to be seen that section 22(2) authorises the assessing officer to impose penalty after giving an opportunity of being heard. The opportunity of being heard read with the word may has some relevance. When the provision gives a lever to the assessing officer to go into ..... X X X X Extracts X X X X X X X X Extracts X X X X
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