TMI Blog2018 (12) TMI 1358X X X X Extracts X X X X X X X X Extracts X X X X ..... d 31.1.2003, it is clear that the dealer paid the sales tax as well as collection made by way of recoupment of entry tax into the treasury. Can it be stated that the dealer has contravened the provisions of Section 22(1) of the Act. This question has been answered in favour of the dealer - the levy of penalty made by the Assessing Officer is unsustainable and the First Appellate Authority is right in allowing the appeal - revision allowed. - Tax Case Revision No.12 of 2013 - - - Dated:- 26-11-2018 - Mr.Justice T.S. Sivagnanam And Mr. Justice N. Sathish Kumar For the Petitioner : Mrs.Aparna Nandakumar For the Respondent : Mr.V.Haribabu, AGP ORDER T.S.SIVAGNANAM, J. This tax case revision filed by the petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. The petitioner is a dealer in vibratory compactors and loader backhoe being earthmoving equipment and registered under the provisions of the Act on the file of the Commercial Tax Officer, Anna Salai-II Assessment Circle. During the assessment year 2000-01, the dealer moved the said equipment from its factory in Madhya Pradesh and other units and sold the same in the State of Tamil Nadu. For the year under consideration namely 2000-01, the dealer reported a total and taxable turnover of ₹ 1,66,93,824/- and ₹ 1,53,76,557/- respectively. The dealer reported the first sale of the equipment at 8% of the taxable turnover. The dealer, at the time of entry of the goods, paid the entry tax under the provisions of the Tamil Nadu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the recoupment of entry tax component was not part of the sales tax collected from the customer at 8%, but was shown separately as entry tax recoupment in the invoices and requested to drop the proposal to levy penalty under Section 22(2) of the Act. The dealer also stated that there had been no excess collection nor retention of tax collected and that everything had been remitted to the treasury. 6. The Assessing Officer, however, by order dated 26.5.2003, rejected the objections raised by the dealer and confirmed the penalty under Section 22(2) of the Act. Challenging the same, the dealer filed an appeal before the Appellate Assistant Commissioner (CT)-IV, Chennai the First Appellate Authority, who, after perusing the facts, fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l mistake in stating that the excess amount collected was not paid over to the State. On a perusal of the assessment order dated 27.12.2002 and the erratum order dated 31.1.2003, it is clear that the dealer paid the sales tax as well as collection made by way of recoupment of entry tax into the treasury. 10. In such circumstances, can it be stated that the dealer has contravened the provisions of Section 22(1) of the Act. This question has been answered in favour of the dealer by the First Bench of this Court in the case of State of Tamil Nadu Vs. K.Mohammed Ibrahim Sahib [reported in (1991) 83 STC 402] wherein it was explained that penalty may be levied under Section 22(2) of the Act where any amount has been collected by way of tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perly appreciate the sample invoice placed before it dated 31.1.2001 in invoice No.C140008. In fact, the Tribunal extracted the invoice as such in its order and from which, we find that the recoupment of entry tax paid has been separately shown by the dealer and it does not form part of the sales tax, which has been collected only at 8%. Therefore, the Tribunal committed an error in coming to the conclusion that the dealer is liable for levy of penalty. We also approve the reasoning given by the First Appellate Authority in the sense that what has been collected by way of recoupment is not a collection under the provisions of the Act for the provisions under Section 22(2) to be attracted. Thus, the levy of penalty made by the Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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