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2016 (9) TMI 1086 - RAJASTHAN HIGH COURT

2016 (9) TMI 1086 - RAJASTHAN HIGH COURT - TMI - Imposition of penalty under section 76(2)(b)of the Rajasthan VAT Act, 2003 - Rule 53 of the VAT Rules - Form VAT-47produced, not duly filled, some columns left blank - suspection of the Assessing Officer that the form can be re-used - sunflower oil in transit from Punjab to Jaipur - other invoices and builties produced - is imposition of penalty is correct in the view that all documents were produced and only a few columns in the form VAT-47 remai .....

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ration in Form VAT-47 completely filled in all respect in ink and ensure that the value, date and month of use of such Form shall be punched at the specified place provided for in the Form. - The AO found that in Part A, the columns relating to name, place, date were blank and in Part B, the columns relating to name, place and date were blank and in Part C, the columns relating to place, status and signatures were not found to be filled in and neither the date, month nor value column was pun .....

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. Sales Tax Revision Petition No. 189/2012 - Dated:- 15-9-2016 - Jainendra Kumar Ranka, J. For the Petitioner : Alkesh Sharma For the Respondent : Meenal Ghiya on behalf of RB Mathur ORDER 1. Instant Sales Tax Revision Petition at the instance of assessee is directed against the order dt.22/06/2012 passed by the Rajasthan Tax Board, Ajmer dismissing the appeal of the assessee. 2. Brief facts noticed for disposal of this petition are that sun flower oil was loaded and was in transit in Vehicle No .....

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Ludhiyana was also produced. The driver Baljeet Singh also produced Form VAT-47 bearing No.2417595 in which in all there were three parts namely; A, B & C and almost in all the parts, some column were found blank and instantaneously it was also noticed that against the date, month and value, the form was not punched and the officer was of the view that neither the Form VAT-47 was filled in nor being punched and the form could be used again and accordingly issued a show cause notice u/Sec. 76 .....

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nded that the bill contained name of the transport company and GR contained name of consignor with address and that the form can be punched later on as well. It was further contended that there was no intention of reusing the form again. However, the Anti Evasion Officer was not satisfied with the explanation of the assessee and accordingly imposed penalty u/Sec. 76(6) taking into consideration the judgment of the Apex Court in the case of Guljag Industries Vs. Commercial Taxes Officer: (2007) 7 .....

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f penalty u/Sec. 76(2). It was further contended that when all documents were found in order, the goods cannot be said to be transported with the intention of evasion of tax. However, the Tax Board also upheld the penalty order. Thus, in unison, all the three authorities came to a finding that there was contravention of provisions of Sec. 76(2) of the VAT Act as well as Rule 53 of the VAT Rules. 6. Ld. Counsel for the assessee contended that the AO has been unable to prove as to merely because s .....

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d in, then the penalty may be justified but if some of the columns, which are not material particulars, remained unfilled, then no occasion arises for imposition of penalty. 7. Counsel produced Form VAT-47 and with the aid of Form VAT-47 tried to impress upon the Court that the columns, which have been found to be not filled in by the three authorities, are not material particulars in as much as he contended that some of the columns in Part A, which were to be filled in by the consignee, only re .....

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judgments of this Court rendered in the case of Assistant Commercial Taxes Officer Vs. M/s. Hindustan Lever Ltd., Ajmer & Anr. (2013) 37 Tax Update 283 and Assistant Commercial Taxes Officer Vs. M/s. REBI Casting (Pvt.) Ltd. & anr.: (2013) 37 Tax Update 74. 8. Per-contra, ld. Counsel for the Revenue contended that Rule 53 of the VAT Rules mandates that a person carrying on such goods was required to carry a declaration form (VAT-47) complete in all respects duly filled in and even if one .....

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ts of Revenue and to avoid the eventualities one more safeguard was introduced in form (VAT-47) that the assessee was required to punch the date of use, value as well as month of use. However, the assessee deliberately did not punch all the three main requirements i.e. date, month and value and the explanation offered is worth rejection. 9. Counsel also dispelled the arguments of the counsel for the assessee that signatures were found on the declaration form and drew attention of the Court towar .....

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ition of penalty. She relied upon judgment rendered by the Apex Court in the case of Guljag Industries Vs. Commercial Taxes Officer (supra). 10. I have considered the arguments advanced by counsel for the parties and have perused the order impugned as well as the other orders. 11. At the outset, it would be appropriate to quote Sec.76 of the VAT Act as well as Rule 53 of the VAT Rules which read ad-infra:- Sec. 76 of VAT Act: "76. Establishment of check-post or barrier and inspection of goo .....

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son duly authorised by such owner or the driver or the person Incharge of a vehicle or carrier or of goods in movement shall- (a) Stop the vehicle or carrier at every check-post or barrier, and while entering and leaving the limits of the State bring and stop the vehicle at the nearest check-post or barrier, set-up under sub- section (1); (b) carry with him a goods vehicle record including "challans" and "bilties", invoices, prescribed declaration forms and bills of sale or d .....

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ol of a transporting agency or person or other such bailee; (ii) the goods which are being carried in a vehicle or carrier belonging to the owner of such goods; and (iii) the goods which are being carried by a person. (3) The State Government may require by notification that the documents required to be furnished under sub-section (2), shall be furnished by means of such electronic devices, and be accompanied by such processing fee, as may be prescribed. (4) Where any goods are in movement withi .....

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to be false or forged, the Incharge of the check-post or barrier or the officer authorised under sub-section (4) may- (a) direct the owner or a person duly authorised by such owner or the driver or the person Incharge of the vehicle or carrier or of the goods not to part with the goods in any manner including by re- transporting or re-booking, till a verification is done or an enquiry is made, which shall not take more than seven days; (b) seize the goods for reasons to be recorded in writing a .....

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uthorised in writing by such owner or person Incharge of the goods, a reasonable opportunity of being heard and after having such enquiry as he may deem fit, shall impose on him for possession or movement of goods, whether seized or not, in violation of the provisions of clause (b) of sub-section (2) or for submission of false or forged documents or declaration, a penalty equal to thirty per cent of the value of such goods." Rule 53 of the VAT Rules: 53. Declaration required to be carried w .....

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ernment, from outside the State for use, consumption, or disposal otherwise than by way of sale; shall furnish or cause to be furnished a declaration in Form VAT-47, completely filled in all respect in ink and ensure that the value, date and month or use of such Form shall be punched at the specified place provided for in the Form. The counterfoil of the declaration Form shall be retained by such dealer and its portions marked as 'Original' and 'Duplicate' shall be carried with t .....

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Department of the State. Provided further that a dealer may furnish the details of serial number of Form VAT-47, vehicle number, Invoice/Bill/Dispatch memo number with date and value of goods regarding the goods in movement either through Short Messaging Service (S.M.S.) or through Interactive Voice Response System (I.V.R.S.), to the department on the telephone numbers allotted for this purpose through a pre intimated cellular phone before the goods enter into the territory of the State. On int .....

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n authorised by the Commissioner at the time of checking of goods in movement, which shall be deemed to be prescribed form with goods in movement. (2) The owner or a person duly authorised by such owner or the driver or person Incharge of a vehicle or carrier or of goods, shall carry with him the documents specified in clause (b) of sub- section (2) of section 76 including declaration form prescribed in sub-rule (1), in respect of the goods in movement and shall produce the same suo motu before .....

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the goods in movement has already been submitted to the assessing authority or the officer authorized under sub-section (4) of section 76, the owner or a person duly authorised by such owner or the driver or person Incharge of the vehicle or carrier or of the goods shall, on inspection by an officer authorized under sub-section (4) of section 76, at any subsequent place, produce the countersigned and sealed copy of the aforesaid declaration along with other documents specified in clause (b) of .....

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the limits of the State and such vehicle shall carry a goods vehicle record including challan, bilties, invoices, prescribed declaration form and bills of sale and dispatch memos and other documents as envisaged in Sec. 76. 13. Simultaneously, Rule 53 of the VAT Rules mandates that a declaration form is required to be carried with goods in movement for import within the State and the registered dealer shall furnish or cause to be furnished a declaration in Form VAT-47 completely filled in all r .....

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nth nor value column was punched and there was no punching at all. The word "shall" having been used is in my view mandatory. 15. It would also be appropriate to quote the pleadings which the assessee himself has admitted in Para 1 at Page 9 in his petition about the signatures having not been made which reads ad- infra:- "It is further submitted that when the vehicle was on national highway proceeding towards Jaipur it was checked by the respondent Assistant Commercial Taxes Offi .....

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original and 2nd part of Vat 47, the column No.3 of part A name, place, date, status and signatures was not written and in part B the name and place was not written and in part C the name, place, status and signature was not mentioned therein to which a reply was submitted contending inter-alia therein that so far as punching and signature of the consignor is concerned they may be permitted to cure the defects and that the signature of the consignee was there on form VAT 47 along with the rubber .....

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Officer (supra) had an occasion to consider scope of Sec. 78(5) of the RST Act, 1994 which was with reference to the declaration form ST-18-A/ST-18-C which is pari- materia to Sec. 76(6) of the VAT Act, 2003 and now Form VAT-47. The said judgment also quoted in extenso the declaration form ST-18-A and ST-18-C and analyzed the form. The Apex Court also took into consideration Rule 53 and observed in Para 25 to 29 of the said judgment which reads ad-infra:- "25. There is dichotomy between co .....

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be carried without Form No. 18A/18C. 26. We are not concerned with non-filing of statements before the A.O. We are concerned with the goods in movement being carried without supporting declaration forms. The object behind enactment of Section 78(5) which gives no discretion to the competent authority in the matter of quantum of penalty fixed at 30 per cent of the estimated value is to provide to the State a remedy for the loss of revenue. The object behind enactment of Section 78(5) is to emphas .....

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n movement because it is left blank then in that event Section 78(5) provides for imposition of monetary penalty for non- compliance. 27. Default or failure to comply with Section 78(2) is the failure/default of statutory civil obligation and proceedings under Section 78(5) is neither criminal nor quasi-criminal in nature. The penalty is for statutory offence. therefore, there is no question of proving of intention or of mens rea as the same is excluded from the category of essential element for .....

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nt were carried with the declaration forms. These forms were duly signed, however, material particulars were not filled in. The explanation given by the assessees in most of the cases is that they are not responsible for the misdeeds of the consignors. The other explanation given by the assessees is regarding the language problem. There is no merit in these defences. They are excuses. The declaration forms were unfilled so that they could be used again and again. The forms were collected by the .....

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any case for waiver of penalty for contravention of Section 78(2). The assessees were fully aware that the goods in movement had to be supported by Form ST 18A/18C. therefore, they made the goods travelled with the forms. However, the said forms are left blank in all material respects. therefore, A.O. was right in drawing inference of mens rea against the assessees. 29. It has been repeatedly argued before us that apart from the declaration forms the assessees possessed documentary evidence like .....

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th blank forms though signed by the consignee. In fact, the assessees resorted to the above modus operandi to hoodwink the competent officer at the check-post. As stated above, if the form is left incomplete and if the description of the goods is not given then it is impossible for the assessing officer to assess the taxable goods. Moreover, in the absence of value/price it is not possible for the A.O. to arrive at the taxable turnover as defined under Section 2(42) of the said Act. therefore, w .....

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enalty is attracted under Section 78(5). Whether the goods are put in movement under local sales, imports, exports or interstate transactions, they are goods in movement, therefore, they have to be supported by the requisite declaration. It is not open to the assessee to contravene and say that the goods were exempt. Without disclosing the nature of transaction it cannot be said that the transaction was exempt. In the present case, we are only concerned with the goods in movement not being suppo .....

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mmercial Taxes Officer (supra) but also the other judgments and held in Para 33, 34 & 35 ad-infra:- "33. Section 78(2) of the RST Act, 1994 read with Rule 55 of the RST Rules, 1995, after its amendment in consequence to the judgment in State of Rajasthan And Another Vs. M/s. D.P. Metals(supra), provides for an opportunity, to be given to produce the required document and/or declaration forms complete in all respects when the goods enters or leaves the nearest check-post of the State. Su .....

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appear false or forged, the Incharge of the check-post or the officer empowered under sub-section (3), may direct the driver or the person incharge of the vehicle or carrier or of the goods not to part with the goods in any manner including by retransporting or rebooking, till a verification is done or an enquiry is made, which shall not take more than seven days. 34. The suspicion or doubt on the documents to be false or forged, per se, does not attract levy of penalty under sub-section (5) of .....

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tate, or the documents are found to be false or forged, after enquiry, that a penalty may be imposed, which is a civil liability for compliance of the provisions of the Act for the purposes of checking the evasion of tax. It is thus not correct to submit that penalty for submission of false or forged document or declaration, necessarily involves adjudication, for which mens rea is relevant, and is a necessary ingredient. Any doubts in this regard have been clarified by the Hon'ble Supreme Co .....

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hat mens rea is not an essential element in the matter of imposition of penalty under Section 78(5)." 35. In view of the aforesaid discussion, our answers to the questions referred, are as follows:- (i) The requirement of mens rea is not relevant for the purpose of determining the liability for penalty, in terms of Section 78(5) of the RST Act, 1994. (ii) The mens rea is not required to be proved as necessary ingredient for imposition of penalty under sub-section (5) of Section 78, on provi .....

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f the RST Act, 1994. (iv) The mens rea is not required to be proved as necessary ingredient for imposition of penalty under sub-section (5) of Section 78, on proving violation of sub-section(2) of Section 78 of the RST Act, 1994." (emphasis supplied) 20. This Court in the case of M/s Bishambhar Dayal Shankar Lal Vs. Assistant Commercial Taxes Officer, Alwar (SB Sales Tax Revision No.99/2006), decided on 27/09/2013 came to the same conclusion. 21. Counsel for the assessee had also contended .....

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