Willful non-disclosure of turnover is required for VAT penalty; absence of recorded satisfaction makes levy unsustainable.

Penalty under Section 27(3)(c) of the Tamil Nadu Value Added Tax Act, 2006 requires a finding of willful failure to disclose assessable turnover. The assessee admitted the mistake after notice and paid the tax before assessment was completed, and the order did not record any specific satisfaction or factual basis for willful non-disclosure. On those facts, the levy of penalty was held unsustainable and the impugned order was liable to be quashed.

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Issues: Whether penalty under Section 27(3)(c) of the Tamil Nadu Value Added Tax Act, 2006 was sustainable in the absence of willful non-disclosure of assessable turnover.

Analysis: The petitioner admitted the mistake on receipt of notice and paid the tax before the assessment was completed. The power to impose penalty under Section 27(3)(c) is attracted only where the Assessing Officer finds a willful failure to disclose assessable turnover. The impugned order did not record any specific satisfaction or basis showing willful non-disclosure, and the tax having already been paid, the conduct did not justify the levy of penalty.

Conclusion: The penalty was unsustainable and the impugned order was liable to be quashed in favour of the assessee.

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