Perversity in tax penalty findings not established where goods were documented as returned rejected material and evidence supported the Tribunal

The Tribunal's finding that the movement of goods was a return of rejected material to the original supplier, supported by invoices, purchase bills, a dealer certificate and the vehicle's voluntary reporting at the check-post, was upheld as a factual conclusion based on evidence. The High Court noted that the record showed proper documentation and no attempt to evade tax, and held that a mere assertion that the goods did not tally with the purchase bills did not establish perversity in the Tribunal's appreciation of evidence. The penalty therefore could not be sustained.

---

---

Issues: Whether the Tribunal's finding that the movement of goods represented return of rejected material and not an attempt to evade tax was perverse so as to justify interference and sustain the penalty.

Analysis: The Tribunal recorded that the consignments were covered by invoices and supporting documents showing return of rejected goods to the original supplier. It also found that the vehicle had voluntarily reported at the check-post, the relevant purchase bills were produced, and the certificate of the concerned dealer regarding return of goods was genuine. On these facts, the finding that the documents were proper and that there was no attempt to evade tax was a factual conclusion based on evidence. The mere contention that the goods did not tally with the purchase bills did not establish perversity in the Tribunal's appreciation of the record.

Conclusion: The finding of the Tribunal was not perverse and the penalty could not be sustained.

---