TaxTMI 
TaxTMI 
2016 (8) TMI 1114
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.... making on job work basis. Two consignments being sent by it outside the State of U.P under the cover of gate pass Nos. 167 and 64 were seized on 28 July 1998. At the time of seizure, the officers found that there was certain overwriting over the gate passes. The revisionist was put to notice and in its reply submitted that certain goods which had been received by it for the purposes of completion of job work contracts were being returned under the gate passes in question. The details of the dealer and the description of goods being returned were also declared. The assessing authority however did not accept the explanation furnished by the assessee and accordingly proceeded to impose penalty in terms of sub section (4) Section 13-A. Aggriev....
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....that it must be established that the goods found in a vehicle building or place are not traceable to any bona fide dealer. The second contingency in which a seizure could take place is upon the authority doubting the goods having been properly accounted for in the accounts, register and other documents. The two contingencies are: - (a) The goods not being traceable to a bona fide dealer; (b) A doubt that such goods have not been properly accounted for. Insofar as imposition of penalty is concerned, the same is an order which comes to be passed after the dealer has been put to notice, an explanation obtained from him and upon the authority being satisfied that the goods were omitted from being shown in the accounts, registers and other ....
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....bills and gate passes under which the raw material is said to have entered into the State. On both scores this Court finds that the assessing authority as well as the Tribunal have permitted the introduction of considerations that were wholly irrelevant to the exercise of power under section 13A. The goods were shown to belong to a bona fide dealer. They were shown to have been duly entered in the books of accounts. How the raw material from which the goods were manufactured entered into the State was a wholly irrelevant consideration and clearly tainted the statutory enquiry beyond repair. Having embarked upon this exercise, in the opinion of this Court, both the assessing authority as well as the Tribunal completely misdirected the enqu....