Case Law Details
Durga Steel Rolling Mills Vs Commissioner of Commercial Taxes U. P. Lucknow (Allahabad High Court)
Allahabad High Court held that penalty under Section 54(1)(2) of the U.P. VAT Act, 2008 cannot be imposed in cases, wherein, the assessment is made on the basis of Best Judgement Assessment. Further, also held that men-rea is pre-requisite condition for imposition of penalty u/s. 54(1)(2).
Facts- A survey took place on the premises of the revisionist. The stock is alleged to have been noted by the surveyors on the basis of presumption. The stock was found to be recorded more in the books of accounts of the revisionist vis a vis the physical stock. An assessment order was passed against the revisionist under the provisions of Section 28(2) of the U.P. V.A.T. Act, 2008. By the said assessment order the disputed demand was indicated as Rs 12,44,653/-. While allowing the appeal, Tribunal gave a relief to the revisionist of Rs 3,25,625/- thus assessing the tax liable to be paid by the revisionist at Rs 2,46,250/- as stated by Shri Mudit Agarwal, learned counsel for the revisionist.
During pendency of the aforesaid proceedings, a notice u/s. 54(1)(2) of the Act, 2008 had been issued to the revisionist. Thereafter, an order of penalty was passed whereby the revisionist has been required to pay an amount of Rs 18,65,625/- against the assessed tax of Rs 6,21,875/-. Being aggrieved the revisionist filed an appeal which was rejected vide the order dated 30.09.2016. Still being aggrieved the revisionist filed a second appeal before Tribunal which has also been dismissed. Being aggrieved the instant revision has been filed.
Conclusion- Held that the order imposing penalty on the revisionist based on the assessment order passed under Section 28(2) of 2008 cannot be said to fall within the ambit of any of the eventualities as provided under Section 54(1)(2) of the Act 2008 more particularly it cannot be considered to be an evasion of payment of tax by the dealer / revisionist so as to attract the penalty as has been imposed on the revisionist.
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