CA Vinod Kaushik
I shall begin my write-up with the wording of section 70 of DVAT Act which empowers Commissioner DVAT to issue notifications and prescribe various forms which are necessary for the administration of the Act. By using the said powers Learned Commissioner issued a notification (No. F 7/433/2012/472-483) dated 16-08-2012 to file rate wise details of stock as on 31st March of every year online by 30th day of June of the same year. The professionals started to file the said statement as prescribed under above notification and for non filing the above statement the Commissioner issued penalty notice of Rs. 10000 under Section 70(5) which reads as “Failure to comply with requirement in a notification may be punishable with fine provided that the amount of the fine does not exceed ten thousand rupees or such other amount as may be prescribed”
ANALYSIS OF SECTION 70 (5) OF DVAT ACT:
The section 70 (5) was interpreted by Delhi high court in context of a writ petition filed by Shubham marketing and Ors and the power of Commissioner to impose fine was declared bad in law and without jurisdiction. Section 70(5) contains the words “Failure to comply with requirement in a notification may be punishable with fine” which is similar to the definition of term offence under Section 3 (38) of the General Clause Act, 1897. Further as per Section 26(b) of code of criminal procedure the offence under Section 3(38) shall be tried by the High Court or any other Court by which such offence is contained in the first schedule to be triable. The offence contained in section 70(5) is punishable with a fine not exceeding Rs. 10000 and the same shall be tried by any Magistrate hence the Commissioner has no power to impose fine under Section 70(5) of DVAT Act, 2004.
ACTION TAKE BY GOVERNMENT:
The Section 70 (5) was omitted vide DVAT (Amendment) Act, 2013 (05 of 2013); No.F.14(5)/LA-2013/com.2law/65, dated 9.9.2013 read with No.F.3(14)/Fin.(Rev.-1)/2013-14/dsVI/703,dated 11.9.2013 w.e.f. 12.09.2013 and also the notification dated 16-08-2012 which initially prescribed filing of stock Statement was withdrawn w.e.f from 23-09-2013. The requirement to file stock as on 31st March of every year was incorporated in the DVAT-16 (No.F.3(16)/Fin.(Rev-I)/2013-14/dsVI/785_20-09-2013) in annexure 1D and further Section 86 also amended to empower Commissioner to levy penalty for non compliance of Section 70 of DVAT Act, 2004.
Now as on date notices issued for non filing of Stock Statement as on 31-03-2012 under Section 70(5) are bad in law because Commissioner has no power to impose such fine . For further years we are required to file said statement in annexure 1D along with second quarter return of next year to avoid any penalty under Section 86 (9) of the Act.
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