Penalty for missing declaration form fails where subsequent production rebuts evasion and notice grounds are limited.

Penalty under the Uttarakhand VAT regime for transporting goods without the declaration form was unsustainable where the form was subsequently produced with the reply to the show-cause notice and the record did not support the alleged copy discrepancy. The High Court held that the statutory requirement of an attempt to evade tax was not satisfied on the facts, the presumption of evasion stood rebutted, and the check-post omission was only a first-time lapse. It also held that a ground not set out in the show-cause notice could not be relied on to sustain the penalty. The assessee was therefore not liable to penalty.

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Issues: Whether penalty for transportation of goods without the declaration form was sustainable when the form was subsequently produced and the assessee claimed absence of any attempt to evade tax.

Analysis: The penalty provision under the Uttarakhand Value Added Tax regime required satisfaction that the goods had been imported in contravention of the statutory requirements with an attempt to evade assessment or payment of tax. The Court found that the declaration form had in fact been produced along with the reply to the show cause notice, that the alleged discrepancy in the original and duplicate copies was not borne out from the record, and that the omission at the check-post was a first-time lapse. It further held that the statutory presumption of evasion stood rebutted on these facts. The Court also held that a ground not stated in the show cause notice could not be used to sustain the penalty.

Conclusion: The penalty was held unsustainable and the assessee was found not liable to be subjected to any penalty.

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