At, High Court of Judicature at Allahabad
By, THE HONOURABLE MR. JUSTICE ASHWANI KUMAR MISHRA
For the Appellant: Nasiruzzaman, M.M. Rai, Advocates. For the Respondent: C.S.C, B.K. Pandey, Advocates.
1. Following questions are stated to arise for consideration in the present revision:
(i) Whether in the facts and circumstances of the case, the Tribunal was justified in law in disbelieving documents produced on the day of interception of vehicle on the surmises and speculations of having been prepared after the detention of the vehicle, and without any substantive material on record to hold so?
(ii) Whether the revisionist was liable to pay any penalty under section 13A(4) of the Act after the presentation of the relevant documents within hours of the interception of vehicle carrying rice meant for export?
2. Penalty under section 13-A(4) of the U.P. Trade Tax Act, 1948 has been imposed upon the assessee on the ground that at the time when the vehicle was detained the driver could not produce valid documents to show that the movement of goods was duly accounted for in the books of account.
3. Assessee herein is a registered dealer and is having a rise mill at Saharanpur. It appears that 95 bags of basmati rice were loaded on a tractor trolley No. HR-5E/6899, and was dispatched to one M/s Tanna Agro Impax Pvt. Ltd., Delhi. The vehicle was intercepted. No document in support of such movement of rise was produced. A show cause notice was issued to the assessee. In reply the assessee produced documents including Form 9 issued by Mandi Samiti, gate pass of Mandi Samiti, transit permit book No.10, serial no. 41 dated 8.11.1998 and builty issued by Motor Truck Operator Association, Saharanpur. Purchase and sale register were also produced. Books of account were also produced to show that transaction of sale amounting to Rs. 1,71,000/- was duly recorded in the account books of the assessee. Explanation so submitted was not found convincing, essentially on the ground that the vehicle through which rise was being transported was shown to be a truck in the bilty, where as it was a tractor trolly.
4. Learned counsel for the revisionist submits that once the transaction was duly accounted for in the books of account there was no justification for the authorities to impose penalty. So far as mentioning of truck number in the builty is concerned, learned counsel states that in the format issued by the transport association only truck number is envisaged, whereas the vehicle was tractor, which was due to inadvertent error. Before the Tribunal it was also highlighted that three previous transactions by the same vehicle were duly reflected in the books of account and were also accepted by the authorities.
5. Learned standing counsel on the other hand submits that the order of the Tribunal is valid and requires no interference.
6. I have heard Shri M.M. Lal, learned counsel for the revisionist and Sri B.K. Pandey, learned standing counsel for the State and perused the material brought on record.
7. Section 13-A(1) and (4) of the U.P. Trade Tax Act reads as under:
"13-A. Power to seize (1) An officer authorised under sub-section
(2) of Section 13 shall have the powers to seize any goods-
(i) which are found in the dealer's [place of business or vehicle] or any other building or place; or
(ii) which such officer has reason to believe to belong to the dealer and which are found in any [place of business or vehicle] or building or place,
but are not accounted for by the dealer in his accounts or register or other documents maintained in the course of his business;
Provided that a list of all the goods seized under this sub-section shall be prepared by such officer and be signed by the officer and not less than two respectable witnesses.
(1-A) Where any officer empowered by the State Government in this behalf has reason to believe that the goods found in any vehicle building or place are not traced to any bona fide dealer or that it is doubtful if such goods are properly accounted for by any dealer or that it is doubtful if such goods are properly accounted for by any dealer in his accounts, registeres or other document, maintained in the course of his business, he shall have power to seize such goods, and the remaining provisions of this section mutatis mutandis apply in relation to such seizure.
(4) If such authority, after taking into consideration the explanation, if any, of the dealer or, as the case may be, the person incharge and giving him an opportunity of being heard, is satisfied that the said goods were omitted from being shown in the account registers and other documents referred to in sub-section (1) it shall pass an order imposing a penalty not exceeding forty percent of the value of such goods as he deems fit."
8. It is settled that if the dealer before an order of seizure could be passed if produces relevant documents and materials to show that goods were duly accounted for and there was no intention to evade tax then the order of seizure or for imposing penalty would not ordinarily be passed. Learned standing counsel submits that in the facts of the present case the decision of the Tribunal is valid.
9. The provision extracted above, is clear inasmuch as it is only if the concerned authority after taking explanation of the assessee is satisfied that the goods were omitted from being shown in the account registers and other documents referred to in sub-section (I) that an order of penalty could be passed.
10. In the facts of the present case before an order of seizure could be passed, the assessee had promptly produced materials to show that the transaction was duly accounted for in books of account. The authorities as well as Tribunal have, for the purposes of imposing and affirming penalty, essentially relied upon the error in describing the transport vehicle. Along with the supplementary affidavit the revisionist has annexed Form 9 issued by mandi samit as well as gate pass which clearly refers to the vehicle registration number printed as HR 05E 6899. The bilty issued by transporter is in the format prepared for the purpose. In the appropriate clause the nature of vehicle is printed as truck. It is possible that the word truck may not have been deleted and tractor trolly entered in its place but such reason alone for imposition of penalty would not be justified.
11. All other supporting materials have been produced to show that transaction was duly accounted for in the books of account. It was also shown that with the same truck the assessee had transported goods thrice in the past as well.
12. In such circumstances the requirement in law 'imposed upon the revisionist to explain that transaction was duly accounted for in the boo
Please Login To View The Full Judgment!
ks of account' had been discharged. 13. This court in M/s S.K. Enterprises v. Commissioner Trade Tax, U.P. Lucknow reported in VSTI (2008)B-407 has been pleased to observe that where the transaction was duly accounted for in the books of account of the assessee, penalty proceedings ought not to be drawn. 14. In view of the fact that the transaction was duly accounted for in the books of account, and the transaction could not be disputed effectively, the order passed by the Tribunal is not liable to be sustained. 15. For the reasons aforesaid the question posed is answered in favour of the assessee, and it is held that the imposition of penalty in the facts and circumstances of the case is not justified.