TMI Blog2018 (6) TMI 974X X X X Extracts X X X X X X X X Extracts X X X X ..... store the order of penalty in these circumstances. It remains a finding of fact, not giving rise to any question of law for our consideration under Section 66 of the Act and we do not find any perversity in the order passed by the Revisional Authority in the present case - appeal dismissed - decided against appellant-assessee. - S.T.A. No. 71/2013 - - - Dated:- 13-6-2018 - Vineet Kothari And S. Sujatha, JJ. Mr. Atul K. Alur, Adv. for Appellants Mr. Vikram A. Huilgol, HCGP for Respondent JUDGMENT The Assessee-M/s. Bhavani Enterprises, Bangalore, has filed the present Appeal under Section 66 of Karnataka Value Added Tax Act, 2003, aggrieved by the Order of the Revisional Authority, namely, the Additional Commissioner of Commercial Taxes, Zone III, Bangalore, on 26.03.2012 restoring the penalty under Section 70[2][a] of the Karnataka Value Added Tax Act, 2003 [ Act , for short], which was imposed by the Assessing Authority vide Order dated 30.04.2009, but the same was set aside by the first Appellate Authority vide Order dated 23.10.2009. 2. The learned Revisional Authority in the facts briefly stated below, restored the said penalty following the Judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal authority is justified in holding that the first appellate authority committed a serious error in setting aside the penalty on the assessee. 3. The penalty in question was imposed by the Assessing Authority under Section 70[2] of the Act, on the ground that input tax credit availed by the Appellant-Assessee was on the basis of fake and false invoices of the selling dealers who actually did not exist and upon investigation and enquiry, it was found that these dealers did not exist and therefore the input tax credit could not be allowed in the hands of the purchasing dealer, the present Appellant-Assessee and therefore the Appellate Authority was not justified in setting aside the penalty under Section 70[2] of the Act which was imposed by the Assessing Authority. 4. The relevant findings and observations of the learned Additional Commissioner of Commercial Taxes in the impugned Order dated 26.03.2012 are also quoted below for ready reference: The objections filed have been perused but the same cannot be accepted for the reason that in the instant case the FAA is of the opinion that the input tax claim cannot be allowed for reason that purchases are on false invoice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of M/s. Riddhi Siddhi Metals and registration charges were met by him through Sales Tax Practitioner Mr. Pehlaz and the invoices of the said concern were being used by said Mr. Goutham Chand. However, the Assessing Authority found, upon investigation of the selling dealers and their addresses given in the registration certificates, that information of these selling dealers existed at the given addresses vide Paragraph 10[i] of the Assessment Order which is also quoted below for ready reference: i) The place of business of the following persons claimed as suppliers for the assessee were visited by the investigating officers and noticed that none of these dealers were doing business in the address furnished since beginning as evident from the statement given by the land lords and on local enquiry. Sl. No. Name of the proprietor Trade name Inv. Officer 1. Sri B.L.Ravindranath M/s Nanjundeshwara Traders TIN:29620758308/065 CTO (INV-4) 2. Sri Chhatar Sing S. Kathotia M/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [supra]. 9. Having heard the learned Counsel for the parties, we are of the opinion that no question of law arises in the present appeal for consideration by this Court and essentially it is a finding of fact arrived at by the Assessing Authority as well as the Revisional Authority in the present case that the Appellant- Assessee claimed input tax credit on the basis of invoices issued by the non existent dealers. We do not find any force in the submission made by learned Counsel for the Appellant-Assessee and as held by the first Appellate Authority that the burden of proof gets shifted on the Revenue to establish that the circumstances exist for imposition of penalty under Section 70[2] of the Act. The provisions of Section 70 quoted below in its plain terms clearly stipulates that the burden of proving that input tax claim is correct lies upon the dealer claiming such input tax credit. 70. Burden of proof.- (1) For the purposes of payment or assessment of tax or any claim to input tax under this Act, the burden of proving that any transaction of a dealer is not liable to tax, or any claim to deduction of input tax is correct, shall lie on such dealer. (2) Where a de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proof to be on the Revenue. The Revisional Authority, was therefore, perfectly justified and within his jurisdiction to restore the order of penalty in these circumstances. We also find that at least two of the dealers from whom input tax credit invoices were claimed in the present case were for consideration before this Court in Microqual s case also [supra], namely, M/s. S.L.V. Enterprises and M/s. T.D. and Company. Therefore, the same or similar bogus selling dealers registered without actual dealers existing appears to be forming the chain of producing false and fake invoices, on the basis of which, such input tax credit was claimed by the purchasing dealers. 12. It cannot be said, in these circumstances, that the Appellant-Assessee did not knowingly produce such invoices, knowing them to be false or fake. A dealer entering into a genuine transaction of purchase always knows the existence and identity of selling dealer. Essentially, two parties must actually exist to enter into a valid contract of sale or purchase and therefore, it cannot be said, in these circumstances, that the Appellant-Assessee did not knowingly produce the tax invoices which were false or fake. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
