Penalty under KVAT section 70B fails where imported goods were in fact used for the assessee's own purposes.

Section 70B of the Kerala Value Added Tax Act applies only where goods are brought from outside the State as for own use and are then used otherwise than for own use. Use of such goods by a hospital in the course of its activities, even if those activities generate profit, does not by itself make the use non-personal or attract penalty. The decisive question is the actual purpose for which the goods were used, and the goods were found to have been used for the assessee's own purposes. Penalty under section 70B was therefore not attracted.

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Issues: Whether penalty under section 70B of the Kerala Value Added Tax Act was attracted when goods were brought from outside the State as for own use but were used by a hospital in the course of its activities.

Analysis: Section 70B applies where a person brings goods from outside the State declaring them as for own use and then uses the goods otherwise than for own use. The mere fact that the goods are used by a hospital in the conduct of its activities, or that such use may generate profit, does not by itself convert the use into non-personal or alienative use. The declaration in form 16 was not ative of the issue. The material question was whether the goods were in fact used for the assessee's own purposes, and the finding was that they were so used.

Conclusion: The penalty provision was not attracted and the assessee was entitled to succeed.

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