TaxTMI 
TaxTMI 
2018 (2) TMI 610
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.... 54(1)(1) of the U.P. VAT Act upon delayed deposit of tax has been affirmed. Section 54(1)(1) is relevant and is reproduced hereinafter:- "54. Penalties in certain cases- (1) The assessing authority, if he is satisfied that any dealer or other person, as the case may, has committed the wrong described in column 2 of the table below, it may, after such inquiry, if any, as it may deem necessary and after giving dealer or person reasonable opportunity of being heard, direct that such dealer or person shall, in addition to the tax, if any, payable by him, pay by way of penalty, a sum as provided in column 3 against the same serial no. of the said table: c Wrong Amount of Penalty (1) ....
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....o non suit the revisionist is that it had sufficient overdraft facilities and that the amount of tax could have been paid from it. The factual plea setup by the assessee that in its bank account it had no liquid funds, however, is not disputed. 4. The assessee places reliance upon a decision of this Court in M/s Govind Sugar Mills Limited vs. Commissioner of Trade Tax reported in 2008 UPTC 991, in which the provisions of the U.P. Trade Tax Act, similar in nature, fell for consideration. This Court after examining the law on the point proceeded to hold as under in para 13 and 19:- "13. In Commercial Auto Sales Pvt. Limited, Allahabad v. Commissioner of Trade Tax, U.P., Lucknow, 2000 NTN (Vol. 17) 714, the Court held: "As....
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....s lawful to be so and whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances." 19. In view of the consistent pronouncement of various judgments on this issue by the Court, this Court is of the opinion that the imposition of penalty under Section 15-A(1)(a) of the Act was patently erroneous especially where the tax along with interest had been deposited and reasonable cause had been shown for the delay which has not been disputed by the department." 5. Learned counsel for the revisionist contends that a reasonable cause had been placed on record before the authorities for the dela....
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.... penalty which flows from a disregard of statutory provisions, the latter is entailed where there is mens rea and is made the subject-matter of adjudication. In our view, penalty under Section 10(3) of the Act is compensatory. It is levied for breach of a statutory duty for non-payment of tax under the Act. Section 10(3) is enacted to protect public revenue. It is enacted as a deterrent for tax evasion. If the statutory dues of the State are paid, there is no question of imposition of heavy penalty. Everything which is incidental to the main purpose of a power is contained within the power itself. The power to impose penalty is for the purpose of vindicating the main power which is conferred by the statute in question. Deterrence is the mai....
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.... U.P. vs. Sukhpal Singh Bal (supra) dealt with a case where vires of section 10(3) of the U.P. Motor Vehicles Taxation Act, 1997 was challenged. The High Court had struck down the provision as being violative of Article 14 and 19(1)(g) of the Constitution. It was in that context that the Apex Court observed that penalty can also be compensatory in nature and that the provision itself could not be struck down. This judgment has no applicability in the facts and circumstances of the present case. 11. So far as the judgment in Chairman, SEBI (supra) is concerned, their Lordships of the Apex Court observed that where penalty proceedings are initiated under the Act there is no question of proof of intention or any requirement of mense r....