Penalty for alleged tax evasion requires material proof of suppression, not mere suspicion, under the VAT detention provision.

Penalty under Section 48(5) of the Uttar Pradesh Value Added Tax Act, 2008 requires a definite, material-based finding that the transaction was not duly recorded in the books of account and that there was an intention to evade tax. On the facts noted, the authorities relied on seizure and suspicion about a later book entry, but produced no survey, search, provisional assessment, or other material to verify suppression at the business premises. Mere doubt could not justify detention or penalty, so the impugned orders were unsustainable and the revision was allowed in favour of the assessee.

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Issues: Whether penalty and detention under Section 48(5) of the Uttar Pradesh Value Added Tax Act, 2008 were justified when the transaction was recorded in the books of account and there was no material to establish an intention to evade tax.

Analysis: Penalty under Section 48(5) required a definite finding that the transaction had not been duly recorded in the books of account with an intention to evade tax. The authorities proceeded on the basis of seizure and an inference that the later entry in the books was made only to compound the seizure. No survey, search, or provisional assessment was conducted to verify the books at the business premises, and no material was brought on record to support an adverse inference. In such circumstances, mere suspicion or doubt could not sustain the penalty.

Conclusion: The penalty and detention were not justified and the impugned orders were unsustainable; the revision was allowed in favour of the assessee.

Final Conclusion: The adjudication failed for want of material showing suppression of the transaction or a taxable intent to evade payment, and the consequential penalty was set aside.

Ratio Decidendi: Penalty under Section 48(5) cannot be sustained unless the authority records a definite finding, based on material, that the transaction was not duly entered in the books with an intention to evade tax; suspicion alone is insufficient.

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