Back
2007 Supreme(Online)(KER) 34247
HIGH COURT OF KERALA
C.N. RAMACHANDRAN NAIR, J
COMPUTER GRAPHICS LIMITED – Appellant
Versus
INTELLIGENCE OFFICER – Respondent
WP(C)/19274/2007
SRI.N.MURALEEDHARAN NAIR, SRI.V.K.SHAMUSUDHEEN, SHRI.C.K.GOVINDAN, GOVERNMENT PLEADER
A taxpayer cannot be penalized multiple times for the same offence without justifiable grounds.
Headnote:
Penalty - Tax Evasion - Act Section List - The court upheld the first penalty order while vacating a duplicate penalty order, affirming the need for justifiable grounds to impose dual penalties for the same offence and interpreting tax law concerning penalty assessment.
Fact of the Case:
The petitioner challenges two penalty orders for tax evasion in the year 2001-02, with one order confirmed after revisions and another being a duplicate for the same offence.
Finding of the Court:
The court found no justification to interfere with the concurrent findings of the authorities on tax evasion and upheld the modified penalty assessment as appropriate.
Issues: Whether the petitioner can challenge the dual penalties for the same tax evasion offence and if the penalty orders were justified.
Ratio Decidendi: It was established that a taxpayer cannot face multiple penalties for the same offence unless clear, differing grounds for each penalty are presented.
Final Decision: First penalty order upheld; duplicate penalty order vacated.
J U D G M E N T
Petitioner is challenging two penalty orders produced as Exts.P1 & P2 in WP(C) No. 19290/2007 for the same offence and evasion of tax for the year 2001-02. The first penalty levied vide order dated 12/08/2002 was modified in first revision by the Deputy Commissioner and in second revision, the order of the Deputy Commissioner is confirmed by the Commissioner vide Ext.P5 in WP(C) No. 19274/2007.
2. Heard learned counsel appearing for the petitioner and the learned Government Pleader.
3. It is seen that the place of business of the petitioner was inspected on 12/11/2001 and substantial stock variation was noticed. Even though petitioner raised various contentions, the same was rejected by the Intelligence Officer and he levied penalty at double the amount of tax sought to be evaded. Though penalty was sustained in first revision, the first revisional authority reduced the penalty to 1 ½ times of tax sought to be evaded, which is confirmed by the Commissioner in second revision vide Ext.P5 order WP(C) Nos. 19274 & 19290/2007 in WP(C) No. 19274/2007. The learned counsel for the petitioner argued the very same points raised before the revisional authorities. However, I do not find there is any justification for interference because stock variation found during inspection is confirmed by concurrent findings of the three authorities. The petitioner’s argument that sales at the time of inspection were not reckoned is not proved with any evidence. The next contention raised is that 36 packets received by Rail on the date of inspection was not considered by the Inspecting Officer is also found against, by the revisional authorities. I do not find any ground to interfere with the clear cut findings of tax evasion by the authorities. So far as the penalty levied is concerned also, I do not find any ground for interference because the penalty levied is only 1½ times of tax sought to be evaded. In the circumstances, WP(C) No. 19274/2007 is dismissed upholding Ext.P5 order of the Commissioner.
4. Ext.P2, challenged in WP(C) No. 19290/2007, is the very same penalty repeatedly imposed on petitioner for evasion of tax for the same period. It is seen from Ext.P2 that penalty is levied again only because petitioner paid the tax assessed based on the penalty order. Probably payment of tax assessed based on penalty WP(C) Nos. 19274 & 19290/2007 goes to substantiate the case of first penalty, but does not justify a repeated penalty for the same offence. In the circumstances, WP (C) No. 19290/2007 is allowed vacating Ext.P2 but sustaining the first penalty order in the modified form produced as Ext.P5 in WP(C)
No. 19274/2007.
(C.N.RAMACHANDRAN NAIR, JUDGE.)
