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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
AJAY KUMAR MITTAL, RAJ RAHUL GARG, JJ.
M/s Sahib Steel Industries, Mandi Gobindgarh - Appellant
Versus
State of Punjab - Respondent
VATAP No. 3 of 2016 (O&M)
Decided on : 27.1.2016
Section 68 - Punjab Value Added Tax Act, 2005 - [Section 51(7)(b)] - The court discussed the provisions of Section 51(7)(b) of the Punjab Value Added Tax Act, 2005 and its application in the case. The court highlighted the attempt to evade tax and the legal consequences under the said section.
Fact of the Case:
The appellant sold Iron Goods to a buyer and the goods were detained by the Excise and Taxation Officer on the ground of tax evasion. The appellant was penalized under Section 51(7)(b) of the Act. The appellant appealed against the penalty, but the appeal was dismissed by the Tribunal.
Finding of the Court:
The court found that there was sufficient evidence to show that there was a clear attempt on the part of the appellant to evade tax. The court dismissed the appeal on the grounds of tax evasion and upheld the penalty imposed.
Issues: The issues included the genuineness of the transaction, the credibility of the driver's statement, verification of documents, and compliance with the rules of natural justice.
Ratio Decidendi: The court held that there was an attempt to evade tax, and the appellant failed to produce any document to refute the allegations. The judgment in Krish Pack Industrie's case did not support the appellant's position.
Final Decision: The appeal was dismissed, and the delay in filing the appeal was condoned.
Ajay Kumar Mittal, J.
1. Delay of 26 days in refiling the appeal is condoned.
2. This appeal has been filed by the assessee under Section 68 of the Punjab Value Added Tax Act, 2005 (in short “the Act”) against the order dated 13.8.2015 (Annexure P-6) passed by the Value Added Tax Tribunal, Punjab (hereinafter referred to as “the Tribunal”) claiming the following substantial questions of law:-
i) Whether the order passed by the Ld. Tribunal is not perverse, as same has been passed without any evidence on record?
ii) Whether enquiry officer is not required to take any action against the firm who is saying that they have sold the goods without bill?
iii) Whether the version/statement of driver can be believed? If yes, then whether same is upto satisfaction of detaining officer?
iv) Whether books/bills and documents have duly been verified by the authorities, before imposing any penalty?
v) Whether the impugned order is in violation of rules of natural justice and is otherwise sustainable in law?
3. Briefly stated, the facts for adjudication of the present appeal as narrated therein are that the appellant sold the Iron Goods (MS Bar) to M/s Sahib Steel International, Mandi Gobindgarh on 1.3.2007 vide invoice No.488 dated 1.3.2007 (Annexure P-1) for Rs. 3,49,954/- which were purchased from M/s R.K. Steel Rolling Mills, Khanna vide bill dated 1.3.2007 for a sum of Rs. 3,46,758/-. The truck bearing registration No. PB-23E-7996 carrying the said goods was detained by the Excise and Taxation Officer, Alour Khanna while loading other goods from some other units from whom M/s Sahib Steel International purchased the goods. The detaining officer detained the goods on the ground that the driver of the truck had told that 10 MT of goods were loaded from M/s AB Steel Mill. The Excise and Taxation Officer instead of taking any action against M/s Satpal Mankoo Steel issued a show cause notice dated 1.3.2007 (Annexure P-2) to the appellant. The Assistant Excise and Taxation Commissioner, Mobile Wing, Ludhiana vide order dated 14.3.2007 (Annexure P-3) imposed a penalty of Rs. 1,04,986/- under Section 51(7)(b) of the Act upon the appellant. Feeling aggrieved, the appellant filed an appeal before the Deputy Excise and Taxation Commissioner (Appeals), Ludhiana Division, Ludhiana who vide order dated 26.10.2012 (Annexure P-4), copy of which was sent to the appellant on 4.3.2013, dismissed the appeal. Against the order, Annexure P-4, the appellant filed an appeal on 8.4.2013 (Annexure P-5) before the Tribunal. The Tribunal vide order dated 13.8.2015 (Annexure P-6) dismissed the appeal. Hence, the present appeal.
4. Learned counsel for the appellant submitted that all the authorities have not looked into the documents on record to return a finding that any attempt of evasion was made or the documents were not genuine. It was urged that the penalty has been levied by treating the transaction to be ingenuine solely on the basis of the statement of the driver of the vehicle which is legally unsustainable. In support of his contention, learned counsel for the appellant has relied upon the judgment of this Court in Krish Pack Industries v. State of Punjab (2006) 28 PHT 27 (P&H).
5. We have heard learned counsel for the appellant.
6. The owner of the goods got the goods released on 5.3.2007 without producing any invoice or other account books before the detaining officer. No explanation was furnished before the Assistant Excise and Taxation Commissioner for not producing the account books or the so called invoice of R.K. Steel Rolling Mills and the other documents including the affidavit of the driver dated 9.3.2007. Accordingly, the Assistant Excise and Taxation Commissioner, Mobile Wing, Ludhiana vide order dated 14.3.2007 (Annexure P-3) imposed a penalty of Rs. 1,04,986/- under Section 51(7)(b) of the Act. Against the order, Annexure P-3, the appellant filed an appeal and the Deputy Excise and Taxation Commissioner (Appeals), Ludhiana sustained the order o
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