VAT penalty upheld for unproved return movement of gold ornaments without reliable statutory documents.

Penalty under Section 47(6) of the Kerala Value Added Tax Act was sustained because the intercepted consignment of gold ornaments was not supported by reliable statutory documents for the claimed return movement. The assessee's reliance on e-sugam and circulars failed where the return document was ambiguous, did not identify the consignment with certainty, and did not prove actual transportation of the goods back outside the State. The Court treated compliance with mandatory documentary requirements as essential and found the burden of proving the asserted return movement had not been discharged.

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Issues: Whether penalty under Section 47(6) of the Kerala Value Added Tax Act was sustainable on the facts proved, and whether the assessee could rely on the claimed return movement circulars and documents to show that the consignment had been taken back outside the State.

Analysis: The consignment of gold ornaments was found in transit without reliable supporting documents for the alleged return journey. The inward movement was said to be covered by e-sugam, but the document produced for the return movement was found ambiguous and insufficient to identify the consignment with certainty. The Court found that the assessee failed to establish actual transportation of the goods back outside the State, and that the materials relied on did not satisfy the mandatory documentary requirements under the VAT regime. The circulars relied on by the assessee did not assist, since the prescribed documents were not shown to accompany the consignment and the factual return of the goods remained unproved.

Conclusion: The penalty under Section 47(6) of the Kerala Value Added Tax Act was upheld, and the revision was dismissed in favour of the Revenue.

Ratio Decidendi: Where a taxable consignment is intercepted without reliable statutory documentation for the asserted return movement, the assessee bears the burden of proving actual transportation outside the State, failing which penalty under the VAT enforcement provision is justified.

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