TaxTMI 
TaxTMI 
2008 (1) TMI 843
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....d in the notice is required before such penalty can be imposed actually after inspection of records, etc., by the designated officer as envisaged under section 61 of the VAT Act read with rule 50(1)(c) of the VAT Rules 2005? (iv) Whether the notice to show cause under rule 50(1)(c) would require specifying the provisions under which the penalty is proposed to be imposed as also the quantum of the penalty to be imposed? (v) Whether, on the facts and in circumstances of the case, tax can be claimed on account of a bona fide omission of a particular purchase being reflected in the quarterly returns when no purchase tax is payable under the VAT Act in respect of the said item? (vi) Whether, on the facts and in the circumstances of the case, penalty can be imposed in respect of a bona fide omission in the quarterly returns filed by the assessee as prepared by his accountant when it was the first year of the new enactment coming into force and there being no mens rea to evade or avoid payment of tax on the part of the assessee? (vii) Whether, on the facts and in the circumstances of the case, penalty can be imposed, on a harmonious reading of rules 36 and 40 of the Pun....
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....urns/accounts. However, they were unable to explain the same and therefore, it was brought to their notice that their action amounts to suppression of purchases made by the dealer/assessee and the same is liable for imposition of penalty/tax at the prevailing rate. The dealer/assessee who were unable to give any suitable explanation for the lapse on his part and action, requested for the adjournment. The case was adjourned to October 6, 2006. On the said date, the proprietor Sh. Chamkaur Singh along with his Advocate Sh. V.K. Bansal was present and when they were asked to explain the reasons for non-showing the amount of purchases in their returns, they admitted that it was a lapse on their part and requested for taking a lenient view while imposing tax/penalty. In view of the above admission of the assessee, he was assessed. The relevant part of the order of the assessing officer is reproduced hereinafter below: "I have gone through the facts of the case. The dealer has failed to reflect the inter-State purchases of goods worth Rs. 4,85,024 in his account books/returns for the year 2005-06. The dealer has no satisfactory explanation in his defence and admitted his fau....
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....ny case the omission of non-reflection of the purchases in the quarterly returns was on account of bona fide omission on the part of the accountant of the appellant-firm, that being the first year of the enactment of the VAT Act in the State of Punjab and further the bona fides are proved from the fact that the said purchases have been duly reflected in the account books of the firm. Learned counsel has further argued that in the case in hand, the principle of natural justice has not been complied with as the appellant has not been given an opportunity to show cause for imposing penalty. In support of his contentions Mr. Puneet Kansal, Advocate, has relied upon Hindustan Steel Ltd. v. State of Orissa [1970] 25 STC 211 (SC). We have heard learned counsel for the appellant and perused the record. The Punjab Value Added Tax Act, 2005 came into force with effect from April 1, 2005. The said Act has been enacted to provide for the levy and collection of value added tax and turnover tax on the sales or purchases of goods and for matters connected therewith and incidental thereto, and for the repeal of the Punjab General Sales Tax Act, 1948. Further Rules have been framed under t....
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....lac; (v) in relation to voluntary registration, rupees five lac; and (vi) in relation to any other person, rupees [fifty lac.] (b) for registration as a registered person for TOT,in relation to a person other than those specified in clause (a), whose turnover during the preceding year is more than rupees five lac, but below rupees (1)[fifty lac]. (4) Every person, who has become liable to pay tax under this Act, either by way of VAT or TOT, shall continue to be so liable, until the expiry of three consecutive years during each of which his gross turnover does not exceed the taxable quantum and such further (1)Substituted for the words "thirty lac" by Punjab Value Added Tax (Amendment) Ordinance (6 of 2005), w.e.f. 5-5-2005. period after the date of such expiry, as may be specified by notification by the State Government and on the expiry of such specified period, his liability to pay tax, shall cease. (5) Every person whose liability to pay tax has ceased under subsection (4), shall again be liable to pay tax under this Act from the date on which his gross turnover again exceeds the taxable quantum. (6) Every casual trader shall be liable to pay tax under t....
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....in excess amount of tax having been paid than due, such excess tax shall be refundable on application as per provisions of this Act and the Rules framed thereunder. No adjustment shall, however, be allowed for such excess payment. (5) In addition to any return under sub-sections (1) and (2), the Commissioner or the designated officer may, require a taxable person or a registered person to furnish such further information along with the returns or at any other time, as may be deemed necessary. (6) Notwithstanding anything contained in this section, the Commissioner or the designated officer, as the case may be, may by notice, direct a person other than a taxable person or a registered person, to file returns at such intervals and in such form and containing such information, as may be required. (7) Every taxable person or registered person, as the case may be, shall file an annual statement in such form and in such manner, as may be prescribed. (8) A taxable person or a registered person, whose registration is cancelled under section 24, shall file such final return, as may be prescribed, within thirty days from the date of cancellation by the Commissioner or the designa....
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....on-in-charge of the vehicle or of the goods. (4) The owner or person-in-charge of a goods vehicle entering the limits or leaving the limits of the State, shall stop at the nearest check-post or information collection centre, as the case may be, and shall furnish in triplicate a declaration mentioned in sub-section (2) along with the documents in respect of the goods carried in such vehicle before the officer-in-charge of the check-post or information collection centre. The officer-in-charge shall return a copy of the declaration duly verified by him to the owner or person-in-charge of the goods vehicle to enable him to produce the same at the time of subsequent checking, if any: Provided that where a goods vehicle bound for any place outside the State passes through the State, the owner or person-in-charge of such vehicle shall furnish, in duplicate, to the officer-in-charge of the check-post or information collection centre, a declaration in respect of his entry into the State in the prescribed form and obtain from him a copy thereof duly verified. The owner or person-in-charge of the goods vehicle, shall deliver within forty-eight hours the aforesaid copy to the officer-in-....
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.... consignor or the consignee is not registered under this Act, then on furnishing of a security in the form of cash or bank guarantee or crossed bank draft, which shall be equal to the amount of penalty leviable rounded up to the nearest hundred. (b) If the owner or the person in-charge of the goods has not submitted the documents as mentioned in sub-sections (2) and (4) at the nearest check-post or information collection centre, in the State, as the case may be, on his entry into or before exit from the State, such goods shall be detained along with the vehicle for a period not exceeding seventy-two hours subject to orders under clause (c) of sub-section (7). (7)(a) The officer detaining the goods under sub-section (6), shall record the statement, if any, given by the consignor or consignee of the goods or his representative or the driver or other person in-charge of the goods vehicle and shall require him to prove the genuineness of the transaction before him in his office within the period of seventy-two hours of the detention. The said officer shall, immediately thereafter, submit the proceedings along with the concerned records to the designated officer for conducting nec....
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....on.-The detained goods and the vehicle shall continue to be so detained beyond the period specified in sub-sections (6) and (7), unless released by the detaining officer or enquiry officer against surety or security as provided for in these sub-sections or the penalty imposed, has been realised or the enquiry officer orders release of the detained goods after enquiry, whichever is earlier. (8) In the event of the consignor or consignee of the goods not paying the penalty imposed under sub-section (7), within thirty days from the date of the commencement of the order imposing the penalty, the goods detained, shall be liable to be sold by the officer, who imposed the penalty for realisation of the penalty, by public auction in the prescribed manner. If the goods detained are of perishable nature or subject to speedy or natural decay or when the expenses of keeping them in custody are likely to exceed their value, the officer-in-charge of the check-post or information collection centre or any other officer referred to in sub-section (2), as the case may be, shall order immediately to sell such goods or otherwise dispose them of after giving notice to the consignor or consignee in t....
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....provisions of this Act shall, for the purpose of levy and collection of tax, determination of interest and recovery of tax and interest, apply to the transporter. Explanation.-(1) For the purposes of this section, where goods are delivered to a carrier, a goods booking agency or any other bailee for transportation, the movement of the goods shall be deemed to commence at the time of such delivery and terminate at the time, such delivery is taken from such carrier, goods booking agency or any other bailee, as the case may be. (2) For the purpose of sub-section (7), service of notice on the representative of the owner or the driver or other person-in-charge of the goods vehicle, shall be deemed to be a valid service on the consignor or consignee of the goods. . . . 54. Penalty for failure to file return or annual statement.-If a person registered under this Act or any other person required to furnish return or annual statement without sufficient cause,- (a) fails to furnish any return or annual statement by the prescribed date; or (b) fails to furnish along with the return or annual statement, the proof of payment of tax in accordance with the provisions of t....
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....iled within a period of twenty days from the date of the expiry of the quarter: Provided further that a person, whose annual gross turnover exceeds rupees one crore in the previous year, shall determine his tax liability for every month and shall pay tax by the 20th day of the month, if paid through the crossed cheque or draft and by the 30th day of the month, if paid through the treasury receipt and shall submit the same to the Designated Officer, along with the information in Form VAT-16; and payment for the last month of each quarter shall be made on the 20th or the 30th day of the close of quarter, as the case may be, along with the quarterly return. The return in form VAT-15, shall be accompanied by photocopies of the treasury receipt evidencing the payment of tax for the previous two months also: Provided further that notwithstanding the fact that even if no tax becomes due or payable in a particular month, the person referred to in the second proviso, shall have to furnish information in form VAT-16: Provided further that a person making sales in the course of interState trade or export out of India may, by making an application to the designated officer, opt to fil....
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....t day of March of the year to which the statement relates. (2) Every taxable person shall also furnish along with the annual statement, a copy of the trading account, profit and loss account and balance sheet as on the 31st day of March of that year along with statutory declaration in form D and other relevant forms under Central Sales Tax Act, 1956. . . . 50. Manner of imposition of penalty for offences under the Act and payment of such penalty.-(1) Where it appears to the Commissioner or the designated officer, as the case may be, that it is necessary to proceed against a person under section 52, 53, 54, 55, 56, 57, 58, 59 or 60, as the case may be, such officer shall serve upon such person a notice, directing him to appear before him in person or through an authorised agent and,- (a) to produce before him the books of account, registers or documents for examination; (b) to explain the books of account or documents produced by such person or evidence that came into possession of any of the said officer; and (c) to show cause on the date specified in such notice, why penalty specified as in the notice, should not be imposed on him. (2) The person may, i....
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....t disputed that despite the three adjournments, the appellant failed to submit any explanation with regard to the non-reflection of inter-State purchases of bed sheets and blankets in his returns. During these proceedings, it was also brought to the notice of the assessee-appellant that the laps/omission on his part amounts to suppression of purchases and the same is liable for imposition of penalty/tax at the prevailing rate. However, on October 6, 2006, the proprietor of the appellant-firm in the present case and his Advocate admitted the omission on their part and requested for taking a lenient view while imposing tax/ penalty and therefore, the arguments raised by the learned counsel for the appellant in the present appeal are devoid of any merit. The judgment in Hindustan Steel Ltd.'s case [1970] 25 STC 211 (SC) relied upon by the counsel for the appellant is distinguishable and is not applicable in the present case as in the present case the appellant has clearly admitted his guilt and tendered no explanation and has only prayed for taking a lenient view in the matter. The learned counsel for the appellant has argued that the designated officer while imposing the penal....