TaxTMI 
TaxTMI 
2017 (1) TMI 578
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....of Bihar is not available with him. 3. Thereafter a show cause notice date 04.10.2016 under Section 48 of the U.P. VAT Act, 2008 (hereinafter referred to as "the Act") fixing 09.10.2016 was issued by the aforesaid Mobile Squad authority on the grounds that the goods were loaded from Ghaziabad (U.P.) as evident from weighment slip, TIN numbers mentioned in the invoices accompanying the goods are invalid, consignors and consignees are not bonafide, consignors and consignees are non-existent hence respondent cannot prove that from whom delivery of goods have been taken and to whom it is to be dilivered and from whom freight is to be received, when contacted on phone numbers mentioned in certain invoices accompanying bilties it came to light that purchasers and their place of business is in Deoria (U.P.) which proves that goods are to be unloaded in District Deoria and to evade tax goods are being transported under the cover of TDF. 4. The respondents submitted a reply dated 22.10.2016 wherein it was stated that they are transporter, they have a transshipment branch at U.P.-Delhi Border where the goods were collected and loaded for transportation, goods are accompanied with bills....
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....the supplementary affidavit dated 16.12.2016 is the information obtained from authorities of B.S.N.L., Padruana, Kushinagar and Office of the Branch Manager of Vodafone, Kasya, Kushinagar by which they informed that the mobile numbers in question are of Deoria. Full address of the person holding the mobile phone numbers, have also been given in these two letters. He submits that on random check, the consignee, M/s Kumar Garments, Hanuman Mandir, CC Road as shown in the alleged invoice no. 211 dated 28.09.2016 of Shakshi Trading Company, has been found to be a registered dealer in Sector-4 of the Commercial Tax Department, Deoria at the given address. A copy of information downloaded from the departmental website in this regard has been filed as Annexure 3 to the affidavit. He further submits that at the time of checking of the packet of goods relating to bilty no.13672, it was found that it is mentioned on the packet itself that the goods are to be delivered at Deoria. He submits that the facts on record, clearly indicate fraudulent conduct of the respondent which shows intent to deceive the department to evade payment of tax by accompanying with the goods fake and fictitious paper....
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....ohinder Singh Gill Vs. Chief Election Commissioner, New Delhi AIR 1979 SC 851 (para 8). He further submits that the judgment in the case of Om Logistics Ltd. Vs. C.C.T. in STR 326 of 2011, has no application on the facts of the present case. He submits that merely on the basis of information in the matter of M/s Kumar Garments and certain information with regard to mobile numbers as filed along with supplementary affidavit, no adverse inference can be drawn with respect to the entire goods. He submits that the information obtained in the matter of M/s Kumar Garments was not part of show cause notice. Lastly he submits that costs may not be imposed as suggested by the learned standing counsel. 10. On a question put to him whether the respondent disputes the correctness of the information with regard to mobile numbers and M/s Kumar Garments filed alongwith supplementary affidavit, he submits that the respondent cannot reply it. Relevant Provisions: U.P. VAT Act, 2008:- Section 46. Power of search, inspection and seizure in case of a person other than dealer:- Where a person carries on any activity ancillary or incidental to or in connection with busin....
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....ealer or documents issued by a bonafide dealer with respect to accompanying goods contains wrong particulars or that it is doubtful if such goods are properly accounted for by any dealer in his accounts, registers or other documents, maintained in the ordinary course of his business, he shall have power to seize such goods, and the remaining provisions of this section shall mutatis mutandis apply in relation to such seizure. (3) An officer seizing the goods under sub-section (1) shall take all the measures necessary for their safe custody and forward the list, referred to in the proviso to sub-section (1), along with other documents relating to the seizure to the assessing authority concerned. (4) The said assessing authority shall serve on the dealer or, as the case may be, the person in charge of the goods at the time of seizure (hereinafter in this section referred to as the person in charge) a notice in writing requiring him to show cause, why a penalty should not be imposed. (5) If such authority, after taking into consideration the explanation, if any, of the dealer or, as the case may be, the person in charge and after giving him an opportunity of ....
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.... if any, to the dealer or, as the case may be, to the person-incharge. (9) Where the officer seizing the goods, before forwarding the list and other documents referred to in sub-section (3), or the assessing authority at any time thereafter, is of the opinion that the goods are subject to speedy and natural decay or where the tax assessed or penalty imposed, as the case may be, is not deposited in accordance with the provisions of this Act, the officer seizing the goods or the assessing authority, as the case may be, may, without prejudice to any other action that may be taken in accordance with other provisions of this Act, cause the goods to be sold by public auction in the prescribed manner. The sale proceeds of such goods shall be adjusted towards the expenses of tax assessed or penalty imposed. The balance, if any, shall be refunded to the dealer or, as the case may be, the person in-charge in accordance with the provisions of sub-section (8). (10) If the amount deposited under sub-section (7) is more than the amount of penalty imposed under sub-section (5), the excess amount so deposited shall be refunded to the dealer or, as the case may be, the person in-c....
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....y be, the duplicate portion thereof after endorsing thereon a receipt for the retained original portion. The assessing authority may, in his discretion, direct the dealer or the person concerned to furnish copies of bill or cash memorandum or challan or invoice received by him from the selling dealer or the consignor of the other State for verification of the contents of the declaration or the certificate. (3) The concerned authority of rail, air, or post shall not deliver the consignment to the dealer or person concerned unless the declaration or certificate dully endorsed as aforesaid, is furnished before him. (4) The provisions in rule 54,and rule 56, except sub-rules (1), (6), (8) and (11) thereof and of rule 57 except subrule (1) and (6) thereof shall mutatis mutandis, apply in regard to the declaration or certificate, as the case maybe, referred to in sub-rule (1). (5) The commissioner may from time to time issue instructions with regard to the procedure to be followed regarding taking of delivery of goods and submission of declaration or certificate." Section 165 of Indian Evidence Act "165. The Judge may, in order to discover or ....
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.... TIN numbers, showing non-existent consignees. Addresses of consignees have not been mentioned in any of the invoices except only one invoice of M/s Shakti Trading Company in favour of M/s Kumar Garments, and instead merely "MERWA" has been mentioned in the invoices. In some of the invoices found accompanying the goods, mobile numbers were noted just below the name of the alleged consignees. The Mobile Squad Authority made a call on these mobile numbers, which revealed that the recipient of the goods are of district Deoria (Uttat Pradesh). Despite specific mention of facts with regard to mobile numbers mentioned in the invoices indicating intended unloading of the goods at Deoria, the respondent has not submitted any specific reply at any stage including his reply dated 22.10.2016 filed before the Mobile Squad Authority. Respondent also declined to answer even before this court as noted in the order dated 19.12.2016. By order dated 13.12.2016, this Court directed the applicant to clarify with some evidence that the goods were for delivery at Deoria. Thereupon, an affidavit of compliance was filed on 16.12.2016 by the applicants, after serving a copy thereof upon the respondent. Inf....
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....d Authority. In fact, the respondents have not only consciously suppressed material facts but also fraudulently acted to get the goods released merely on their baseless stand that the goods were being transported from outside the State of U.P. to outside the State of U.P. 14. In view of the above discussion, prima facie I have no difficulty to hold that the goods in question originated for transportation from Ghaziabad, were being carried by the respondent in a fraudulent manner under the cover of bogus invoices with fictitious TIN numbers printed thereon. Respondents downloaded TDF-1 by submitting false information, suppressing material information, identity and particulars of real owners of the goods, so as to give it colour of transportation of the goods from outside the State of Uttar Pradesh to outside the State of Uttar Pradesh under Section 52 of the Act, with intent to evade tax under the Act. Under the circumstances, seizure of the goods under Section 48 of the Act and demand of cash security by the Mobil Squad Authority for release of the goods, does not suffer from any illegality. Question No.(ii) Whether Delhi - U.P. Border area of District Ghaziabad is "no-man....
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.... of sale and purchase and totally ignorant about the consignors and consignees? 18. Before the authorities and the Tribunal, the respondents took the stand that they being transporter have no right to obtain information of any kind about any businessman rather the business of transportation is based on practical formula that whosoever books the goods for a place of destination, he takes bilti and on the place of destination the goods are delivered to the person who produces bilti. Before the Tribunal the respondents pleaded that they do not enquire whether the consignors and consignees are in existence or not. The stand so taken has no substance in view of the observations of Hon'ble Supreme Court in the case of A.B.C. (India) Ltd. Vs. State of Assam and another (2005) 6 SCC 424 (para-22) as under: "22. In our view, transporters are not strangers to the sale or purchase of goods, to the contrary are part and parcel and are directly involved in storing the goods purchased or sold by dealers, and in many cases such transactions are fictitiously carried on in false names and addresses besides false classifications vis-a-vis transportation of such goods in and outside t....
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....on of India and another, (2012) 6 SCC 613 (paras 323, 331) Hon'ble Supreme Court considered the effect of adoption of colourable devices and held as under: "323. McDowell has emphatically spoken on the principle of Tax Planning. Ranganath Mishra, J. on his and on behalf of three other Judges, after referring to the observations of S.C. Shah, J. in CIT v. A. Raman and Co. AIR 1968 SC 49, CIT v. B. M. Kharwar (1969) 1 SCR 651, the judgments in Bank of Chettinad Ltd. v. CIT, (1940) 8 ITR 522, Jiyajeerao Cotton Mills Ltd. v. CIT, Bombay AIR 1959 SC 270; CIT v. Vadilal Lallubhai (1973) 3 SCC 17 and the views expressed by Viscount Simon in Latilla v. IRC, (1943) AC 377 : 25 TC 107 (HL) stated as follows: (McDowell and Co. Ltd. V. CTO, (1985) 3 SCC 230, SCC pp.254-55, para 45) "45. Tax planning may be legitimate provided it is within the framework of law. Colourable devices cannot be part of tax planning and it is wrong to encourage or entertain the belief that is honourable to avoid the payment of tax by resorting to dubious methods. It is the obligation of every citizen to pay the taxes honestly without resorting to subterfuges." 331. Reddy, J., w....
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....recklessly causing him to believe and act on falsehood. It is a fraud in law if a party makes representations which he knows to be false, and injury ensues therefrom although the motive from which the representations proceeded may not have been bad. 25. Although in a given case a deception may not amount to fraud, fraud is anathema to all equitable principles and any affair tainted with fraud cannot be perpetuated or saved by the application of any equitable doctrine including res-judicata. 37. It will bear repetition to state that any order obtained by practising fraud on court is also non-est in the eyes of law." (Emphasis supplied by me) 25. In the case of S.P. ChengalVaraya Naidu (dead) by L.Rs Vs. Jagannath (dead) by L.Rs and others, AIR 1994 SC 853, the Hon'ble Supreme Court held in para 7 as under : "7. The High Court, in our view, fell into patent error. The short question before the High Court was whether in the facts and circumstances of this case, Jagannath obtained the preliminary decree by playing fraud on the court. The High Court, however, went haywire and made observations which are wholly perverse. We do not agree with the....
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.... terminate his services. 29.5 Purpose of calling for information regarding involvement in any criminal case or detention or conviction is for the purpose of verification of the character/antecedents at the time of recruitment and suppression of such material information will have clear bearing on the character and antecedents of the candidate in relation to his continuity in service. 29.6 The person who suppressed the material information and/or gives false information cannot claim any right for appointment or continuity in service. 29.7 The standard expected of a person intended to serve in uniformed service is quite distinct from other services and, therefore, any deliberate statement or omission regarding a vital information can be seriously viewed and the ultimate decision of the appointing authority cannot be faulted. 29.8 An employee on probation can be discharged from service or may be refused employment on the ground of suppression of material information or making false statement relating to his involvement in the criminal case, conviction or detention, even if ultimately he was acquitted of the said case, inasmuch as such a situation wo....
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....ey have not disclosed the real person/ owner of the goods in question. Wrong has been clearly committed and, therefore, the respondents cannot be allowed to take advantage of their own wrong on the basis of technical pleas so as to frustrate the law. Once a transportation of goods under the cover of Section 52 of the Act is shown to be fraudulent, sham, bogus, circuitous or a device designed to evade tax under the Act, the statutory authorities under the Act and the court can always examine the substance of the transaction because the legislature never intends to guard fraud. No authority or court may recognise such transportation or transaction on the basis of the provisions of Section 52 of the Act. Law is manifestation of principles of justice, equity and good conscience. Hence section 52 of the Act cannot be interpreted and understood in a manner so as to encourage tax evaders and to discourage those who abide by law. It is the obligation of every citizen to pay the taxes honestly without resorting to subterfuges. No doubt, when a person transports goods from outside the State of U.P. to outside the State of U.P. in terms of Section 52 of the Act and Rule 58 of the Rules, the a....
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....आदि के अतिरिकà¥à¤¤ इस पारगमन घोषणपतà¥à¤° TDF-1 को à¤à¥€ रखना अनिवारà¥à¤¯ होगा।†Document 2 "कमà¥à¤ªà¥à¤¯à¥‚टर परिपतà¥à¤° सं0 1617028 दिनांक 29.08.2016 संखà¥à¤¯à¤¾-विधि - 4 (1) / सामानà¥à¤¯ निरà¥à¤¦à¥‡à¤¶ / 16-17 / 1351 / वाणिजà¥à¤¯ कर समसà¥à¤¤ कारà¥à¤¯à¤¾à¤²à¤¯ कमिशà¥à¤¨à¤° वाणिजà¥à¤¯ कर, उतà¥à¤¤à¤° पà¥à¤°à¤¦à¥‡à¤¶ (विधि अनà¥à¤à¤¾à¤—) लखनऊ : दिनांक : 26 अगसà¥à¤....
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....िपतà¥à¤° दिनांक 31.01.1987 के संदरà¥à¤ में याची का कथन था कि माल गोदाम में पहà¥à¤‚चने से पूरà¥à¤µ "no mans land†में होने के कारण माल का अà¤à¤¿à¤—à¥à¤°à¤¹à¤£ नहीं किया जा सकता । (2) "कारण बताओ नोटिस" के उतà¥à¤¤à¤° में फारà¥à¤® 38 दाखिल कर दिये जाने के आधार पर अà¤à¤¿à¤—à¥à¤°à¤¹à¤£ की कारà¥à¤¯à¤µà¤¾à¤¹à¥€ अपà¥....
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....¹à¥ˆ जिसके आधार पर कमिशà¥à¤¨à¤°, वाणिजà¥à¤¯ कर को यह अधिकार पà¥à¤°à¤¾à¤ªà¥à¤¤ हो कि वे अपने अधीनसà¥à¤¥ अधिकारियों को उतà¥à¤¤à¤° पà¥à¤°à¤¦à¥‡à¤¶ राजà¥à¤¯ के समसà¥à¤¤ à¤à¥‚-à¤à¤¾à¤— के अनà¥à¤¤à¤°à¥à¤—त माल को रोकने, जांच करने और उनका अà¤à¤¿à¤—à¥à¤°à¤¹à¤£ करने का अधिकार है तथा यह शकà¥à¤¤à¤¿à¤¯à¤¾à¤ अधिनियम दà¥à¤µà....
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....¥€ जांच / अà¤à¤¿à¤—à¥à¤°à¤¹à¤£ की कारà¥à¤¯à¤µà¤¾à¤¹à¥€ की जा सकती है। वैसे à¤à¥€ पà¥à¤°à¤¶à¥à¤¨à¤—त परिपतà¥à¤° ततà¥à¤¸à¤®à¤¯ कारà¥à¤¯à¤°à¤¤ जॉच चौकियों की à¤à¥Œà¤—ोलिक सà¥à¤¥à¤¿à¤¤à¤¿ के कारण हो रहे करापवंचन की पà¥à¤°à¤à¤¾à¤µà¥€ जांच हेतॠजारी किया गया तथा वरà¥à¤¤à¤®à¤¾à¤¨ में जॉच चौकियाठसमापà¥à¤¤ हो जाने के कारण à¤....