TaxTMI 
TaxTMI 
2002 (5) TMI 74
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....ty outstanding from an independent processor of textile fabrics in case such person fails to pay the amount of duty or any part thereof by the specified date, is challenged, on the ground that the aforesaid Rule, is ultra vires the Constitution. 3. Rule 96ZQ of Rules, 1944, reads as under :- "96ZQ. Procedure to be followed by the independent processor of textile fabrics — (1) An independent processor of textile fabrics falling under heading Nos. 52.07, 52.08, 52.09, 54.06, 54.07, 55.11, 55.12, 55.13 and 55.14 of the Schedule to Central Excise Tariff Act, 1985 (5 of 1986), shall debit an amount of duty of Rs. 1.5 lac per chamber per month or Rs. 2 lacs per chamber per month, as the case may be, on the annual ca­pacity of production a....
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....upees five thousand, whichever is greater. (6) If an independent processor removes the processed textile fabrics referred to in sub-rule (1) without complying with the requirements of that sub-rule or sub-rule (2) or sub-rule (3) then all such goods shall be liable to confiscation and the independent processor shall be liable to a penalty equal to an amount not exceeding three times the value of such goods, or rupees five thousand, whichever is greater. (7) Where an independent processor does not produce or manufacture the processed fabrics specified in sub-rule (1) during any continuous period of not less than seven days and wishes to claim abatement under sub-section (3) of section 3A of the Central Excise Act, 1944 (1 of 1944) the abat....
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....ore, considering the constitutional mandate, it becomes bounden duty of the tax payers to pay taxes in time. Therefore, this provision is to be invoked when revenue is not paid by an assessee in time. The aforesaid two clauses operate in different fields and it is known that compensatory measures as well as measure for deterrent effect can be provided and we find no difficulty in arriving at a conclusion that it is not possible to provide compensatory measure as well as the measures which would deter the assessees. What is important in the instant case in our view is that there is source of power and therefore the contention raised by the assessee that there is no source cannot be accepted. 6. What is important in the present case is that ....
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....the statement for a good and valid reason must necessarily lead to the presumption that the registered dealer had the intention of facilitating the evasion of entry tax." 8. Before us, the learned Counsel appearing for the Revenue submitted that in view of the mandate as indicated in sub-rule (5) of Rule 96ZQ, the words contained therein, namely, "he shall be liable to" must mean that the penalty must be imposed as indicated in sub-clause (ii) of sub-rule (5) of Rule 96ZQ. It is required to be noted that in the case of State of Madhya Pradesh v. Bharat Heavy Electricals (supra), the Apex Court considered as to whether the words "shall be presumed" occurring in Section 28B were rebuttable or not. The Apex Court referred to the decision rend....
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....mission of the statement under sub-sections (1) and (2) of Section 7 was not with a view to facilitate the evasion of entry tax." The Apex Court pointed out that, "if a registered dealer is unable to satisfy the authorities in this regard then, in the absence of satisfaction, the presumption is that non-submission of statement has facilitated the evasion of entry tax". It is in view of this that the Apex Court held that the Section does not suffer from any vice and the Section is required to be construed to mean that the presumption contained therein is rebuttable and secondly, the penalty stipulated therein is only the maximum amount which would be levied and the assessing authority has the discretion to levy lesser amount depending upon ....