OVAT Act: Penalty in Turnover escaping Assessment was not Automatic

National Alumini Vs Dy. Commissioner (Orissa High Court)

It is seen under Section 43 (2) of the OVAT Act the levy of penalty in the event of turnover escaping assessment, or under assessement, is not automatic. The AO has to be satisfied that escapement or under assessment of tax “is without reasonable cause”. Further upon arriving at such conclusion,, the AO “may direct the dealer to pay, by way of penalty, a sum equal to twice the amount of tax additionally assessed under the Section.” The word ‘may’, in this context gives the AO a discret

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