TMI Blog2022 (9) TMI 620X X X X Extracts X X X X X X X X Extracts X X X X ..... of 100% waiver of penalty sought to be levied upon him under Section 70(2) R/w Section 39 of the KVAT Act as per the reassessment orders dated 24.09.2020 and 27.04.2021. It is also significant to note that the material on record also indicates that the petitioner is not charged with any arrears of tax, which was liable to be paid on or before 31.10.2021 so as to attract Clause No.5.1 of the Scheme; on the other hand, in view of the undisputed fact that the petitioner did not have any arrears of tax but only arrears of penalty relating to reassessment, which was already completed on 24.09.2020 and 27.04.2021, much before the cut off date dated 31.07.2021, the petitioner would clearly be entitled to the benefit of waiver of 100% penalty and consequently, the impugned endorsement passed by respondents No.2 and 3 are illegal, arbitrary and contrary to the letter and spirit of the scheme and the same deserves to be quashed. The contention urged by the respondents that waiver of penalty levied upon the petitioner under Section 70(2) in the reassessment orders dated 24.09.2020 and 27.04.2021 do not come within the scope and ambit of the scheme since Section 70(2) does not find a pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7.04.2021 under Section 70(2) R/w Section 39 of the KVAT Act and issued a demand notice to the petitioner pursuant to the same. Meanwhile, the aforesaid scheme having come into force with effect from 29.03.2021, petitioner submitted an application dated 28.12.2021 in Annexure- IA seeking waiver of the aforesaid penalty by invoking the benefit provided in favour of the petitioner under the said Scheme. It is the grievance of the petitioner that despite the petitioner being entitled to complete waiver of 100% of penalty as contemplated in Clause-2 of the said Scheme, respondents No.2 and 3 have erroneously and incorrectly rejected the said applications/claims of the petitioner for waiver on the erroneous and incorrect premise/ground that the said scheme was not applicable and the penalty levied upon the petitioner was beyond the ambit of the said scheme. Aggrieved by the impugned endorsements dated 28.12.2021 and 29.12.2021 respectively, the petitioner is before this Court by way of the present petition. 4. Per contra, learned AGA, in addition to reiterating the various contentions urged in the Statement of Objections and referring to the documents produced by the respondents ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies Act, 1979 (hereinafter referred to as KTL Act); d. Karnataka Agricultural Income Tax Act, 1957 (hereinafter referred to as KAIT Act); and e. Karnataka Entertainments Tax Act, 1958, (hereinafter referred to as KET Act). 5. Conditions: Grant of waiver of penalty and interest is subject to the following conditions: 5.1 Any dealer or person or proprietor as the case may be, who makes full payment of arrears of tax on or before 31.10.2021 shall be granted waiver of 100% of arrears of penalty and interest payable. However, any penalty levied by the Registering Authority under section 10-A of the CST Act shall not be eligible for benefit of waiver under this Scheme. 5.2 Where the dealer has no arrears of tax but has arrears of penalty and interest only, relating to the assessments or re-assessments already completed and to be completed, as the case may be, on or before 31.07.2021, such arrears of penalty and interest shall be eligible for waiver. 7. A perusal of Clause-1 to 4 of the said Scheme will indicate that all the four clauses relate to four different, distinct, separate, independent and stand alone categories, which are mutually exclusive and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x but only arrears of penalty and interest relating to assessments/re-assessments already completed as on 29.03.2021 (when the scheme came into force) and to be completed on or before 31.07.2021, such arrears of penalty and interest shall be eligible for waiver. 9. The following aspects emerge in relation to grant of waiver of penalty and interest from a conjoint and harmonious reading of Clause No.1 to Clause No.5.2 of the scheme: (a) All the four clauses i.e., Clauses 1, 2, 3 and 4 of the Scheme are independent, separate, different, distinct and stand alone clauses/provisions, which are mutually separate and exclusive of each other dealing with and being applicable to different and separate categories, situations and statutory provisions; there is no overlapping among each other/one another between the applicability of each of the four clauses; in other words, each of the four clauses operate in their own exclusive spheres and applicability of any one of the Clauses would necessarily exclude the applicability of the other three Clauses. (b) All arrears of penalty and interest under various enactments viz., Karnataka Sale Tax Act, KVAT Act etc., shall be waived in rela ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that would be applicable to the facts of the instant case and in the light of the undisputed fact that the reassessment was completed on 24.09.2020 smf 28.04.2021 as can be seen from the reassessment orders, which is clearly much prior to 31.07.2021, the cut off date under the scheme, the petitioner would be entitled to the benefit of 100% waiver of penalty sought to be levied upon him under Section 70(2) R/w Section 39 of the KVAT Act as per the reassessment orders dated 24.09.2020 and 27.04.2021. It is also relevant to state that so long as the penalty sought to be levied upon the petitioner is under Section 70(2) R/w Section 39 of the KVAT Act and not under Section 72 (1)(a), 72(1)(b), 74(4) or 72(3-B) of the KVAT Act, Clause No.3 of the Scheme is clearly not applicable to the facts of the instant case qua the petitioner and the reassessment orders dated 24.09.2020 and 27.04.2021, which were passed prior to the cut off date dated 31.07.2021 as stipulated in the scheme, which is clearly applicable to the petitioner, who would be entitled to the benefit of the scheme in the facts of the instant case. 11. It is also significant to note that the material on record also indica ..... X X X X Extracts X X X X X X X X Extracts X X X X
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