2009 (1) TMI 825

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....y the State against the order of the Sales Tax Appellate Tribunal cancelling penalty levied on the respondent under section 29A(4) of the Kerala General Sales Tax Act for attempted evasion of tax in respect of a consignment of high speed diesel (12,000 litres). A penalty is levied based on detection of goods at Thalassery without proper documents. Even though the assessee later produced documents ....

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....r-State purchase of diesel by the respondent who is a retail dealer in Mahi from Hindustan Petroleum Corporation in Elathur which is south of Mahi to Mahi which is part of the Union Territory of Pondicherry. The goods admittedly reached at the entry check-post, namely, Azhiyoor Chungam Check-post at 12.12 p.m. on October 17, 1990. In fact, Mahi has only one squire kilometre area and the goods whic....

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....he Union Territory by granting sales tax Registration to all and liberally supplying C Forms and other documents to the dealers in Mahi for helping accounting of purchase and sale of goods in Mahi which really do not take place there. In fact, we have pronounced several judgments touching upon the scheme of tax evasion practised by dealers in several items in Mahi. The respondent's explanation....

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....ort was to sell the goods in Kerala outside Mahi, i.e., in Thalassery or nearby areas leading to eight per cent gain on tax which is substantial. Therefore, this is a case of clear attempt of evasion of tax and the respondent cannot claim exemption from penalty by accounting the goods after fraud was detected by the Department. Even though counsel for the respondent has relied on judgment of th....