Prompt curing of transport document defects can defeat penalty where the required form is produced with the notice reply.

Penalty for non-production of Form VAT 47 at vehicle checking was held unsustainable where the form was furnished to the checking authority on the same day in reply to the show cause notice. The governing principle applied was that a temporary defect in goods-in-transit documents should ordinarily not attract penalty once the requisite document is produced promptly and the transaction is supported by other transport papers showing bona fides. The authority erred in treating the initial non-production as a continuing contravention and in ignoring the curative effect of the reply and accompanying documents.

---

---

Issues: Whether penalty under Section 76(6) of the Rajasthan Value Added Tax Act, 2003 was exigible when Form VAT 47, absent at the time of vehicle checking, was furnished to the checking authority on the same day along with the reply to the show cause notice.

Analysis: The governing principle applied was that where a deficiency or contravention noticed in goods-in-transit documents is removed by furnishing the requisite document in response to the notice, penalty should ordinarily be avoided. On the admitted facts, Form VAT 47 was produced before the checking authority on the very same day, along with other transport documents that indicated the bona fides of the transaction. The authority below, therefore, erred in treating the temporary non-production of the form at the time of checking as a continuing contravention, and in disregarding the curative effect of the reply and accompanying document.

Conclusion: Penalty under Section 76(6) of the Rajasthan Value Added Tax Act, 2003 was not sustainable, and the assessee succeeded.

---