Rajasthan High Court - Jaipur
A C T O vs B C & Company & Ors on 22 May, 2013
IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR. ORDER. SB Sales Tax Revision Petition No.88/2009 Assistant. Commercial Taxes Officer, Warde-II, Circle-H, Jaipur. vs. M/s.B.C. & Company, Jaipur & Ors. Date of order :- 22.5.2013. PRESENT HON'BLE MR. JUSTICE JAINENDRA KUMAR RANKA Ms. Tanvi Sahay, for Mr. RB. Mathur, for the petitioner. Mr. Devendra Kumar for Mr. Dinesh Kumar for the respodnent. By the Court:-
1. Instant revision petition has been filed by the petitioner under Section 86 of the Rajasthan Sales Tax Act,1994 ( in short 'The Act of 1994) challenging the order dated 3.1.2008 passed by the Rajasthan Tax Board, Ajmer, in appeal No. 845/2007 whereby the order passed by the learned Deputy Commissioner (Appeals)-II, Jaipur (In short DC(A)) dated 22.3.2007 and the order dated 19.1.2004 of learned Assessing Officer had been quashed, set-aside and deleted the penalty.
2. The brief facts emerging on the face of record is that a survey took place at the business premises of the respondent-assessee on 19.1.2004 and at the time of survey one Shri Umesh Roheda, the partner of the respondent partner-ship firm was found at the business premises. The respondent-assessee is dealing in the business of Bakery and General Confectionery products. During the course of survey at the business premises, no books of accounts, bills vouchers and other supporting material were found.
3. It has been stated by the Assessing Officer that despite ample opportunities having been provided to the assessee, he could not produce the books of accounts and supporting material. In one corner of the business premises, the survey team found some tins and packed material in cartons. Enquiry was made about the said goods, and the assessee was asked to produce copy of the bills/ builties and also the other supporting material as also books of accounts but during the course of survey, neither the books nor the bills and vouchers as stated above, were produced by the respondent-assessee. The Assessing Officer, granted time to the assessee to produce the bills/vouchers and other material in support of his defence and also issued notice to show cause for 27.01.2004 for production of necessary account books and other bills, builties and vouchers as also other supporting material to explain the position with regard to excess stock available in the premises. It is stated in the assessment order that the actual list was prepared not only in the presence of partner of the respondent firm but also in the presence of two witnesses and according to the assessee, the value of the goods was assessed to be at Rs.1,53,750/- and agreed to by the respondent. Despite opportunities having been provided to the respondent-assessee, the respondent-assessee gave explanation on spot and admitted that neither the bills nor the builties are available and the goods in dispute had been received from outside the State without bills and admitted the mistake. He himself, did not avail of opportunity and requested for closing the proceedings then and there. However, he pleaded for imposition of penalty, if any, in accordance with law. The petitioner vide order dated 19.1.2004 imposed penalty at Rs. 46,125/- on Rs. 1,53,750/- @ 30% of the value of the goods under Section 78(5) of the Act.
4. Being dis-satisfied with the order passed by the learned Assessing Officer, an appeal was preferred before the DC(A), wherein it was submitted that the stock was taken on estimate basis; the address of the witnesses were not shown and that there was violation of provisions of Rule 50 and, therefore, the penalty was wrongly levied/imposed. It was also claimed that the respondent was pressurized to surrender the same and also furnished an affidavit before the DC(A) however, the learned DC(A) was not satisfied with the explanation offered by the respondent-assessee and clearly observed in the appellate order that there is no violation of Rule 50 as it has been duly signed and sealed by two witnesses and valuation was also admitted having been done in the presence of partner and two witnesses. The learned DC(A) also observed that even before him, (the DC(A) neither bills, builty and vouchers nor even the books of accounts were produced and further that the respondent had admitted and there is clear confession of mistake committed by the respondent-assessee with regards to un-accounted stock of goods without having bills, builties and vouchers. Accordingly, the DC(A) in the facts and circumstances of the case, dismissed the appeal and sustained the penalty.
5. Being aggrieved with the order passed by the DC(A), appeal was preferred by the assessee before the Tax Board, who after going through the material on record, reversed the findings arrived at by the learned DC(A) and accepted the explanation given by the respondent-assessee. It was observed by the Board that some action ought to have been taken by the DC(A) on the affidavit having been filed by the assessee before him. It was also observed by the Tax Board, that there is no finding with regard to violation of Rule 50 and according the penalty so imposed by the Assessing Officer and confirmed by the DC(A) was deleted.
6. Hence, this revision petition.
7. Ms. Tanvi Sahai, learned counsel for the petitioner department submitted that despite so many findings given by the Assessing Officer and the DC(A), the Tax Board, has wrongly deleted the penalty in a casual manner when there was a clear cut admission/confession of the partner of the respondent firm that the excess goods was neither supported by the required and proper books of accounts, nor bills,vouchers and builties and no documents were found in the premises during the course of survey and even later on. She further submitted that in this case two witnesses were there and in their presence and in the presence of the partner of the respondent firm, physical verification of excess goods was taken and the partner of the respondent firm agreed with the value of the un-accounted goods worked out by the survey team in the presence of two independent witnesses. She further submitted that adequate opportunity was given to the respondent by giving further date for producing relevant documents and the books of accounts and despite time granted to him, the respondent voluntarily chose by moving an application in writing admitting the fact about unaccounted stock and for imposition of penalty on the spot. She further submitted that under some apprehension that something more would be found therefore, the respondent agreed for imposition of penalty on the value of goods worked out in his presence on the spot. She vehemently argued that there was no pressure on the assessee and filing of affidavit is after thought. She further submitted that the Tax Board in a summary manner has reversed the findings which is not justified and proper. She again submitted that the affidavit so filed was a self serving statement and no credence can be placed on such affidavit. Therefore, it was finally pleaded that the penalty imposed by the learned Assessing Officer, was justified and the same may be reversed.
8. Learned counsel for the respondent Mr. Dinesh Kumar assisted by Mr. Devendra Kumar submitted that the Tax Board has rightly deleted the penalty as there was clear cut violation of Rule 50. He submitted that there was no rebuttal of affidavit given by the partner of the respondent firm. He further submitted that by elaborate discussions, the penalty has rightly been deleted. Therefore, there is no case of reversing the findings of the case. He placed reliance on the Case of Assistant Commercial Taxes Officer Vs. Kishori Shyam Brijesh Kumar [1994] 93 STC 213 and the case of M/s. Diamond Marketing Agency, Jaipur Vs. ACTO (Anti Evasion-I),Circle-II, Jaipur 19 Tax Up-Date 12.
9. Having heard the learned counsel for the parties and perusing the material on record, I am satisfied that the penalty has wrongly been deleted by the Tax Board for the reason that (i) no books of accounts, bills, builty and vouchers were found/produced during the course of survey;(ii) despite adequate opportunity having been granted not only at the time of survey but thereafter neither bills, builty, vouchers and books of accounts and other supporting documents relating to excess goods were produced; (iii) there is clear cut confessional statement of partner of the respondent firm admitting about the excess stock of the goods (iv) two witnesses were also present at the time of survey and in their presence physical stock was taken and the value of excess goods was admitted by the respondent; and (v) even before the DC(A) neither the bills, builty, vouchers nor books of accounts were produced and there is a categorical finding of the DC(A) that there is no violation of Rule 50. When there is clear cut finding of the Assessing Officer as also by the DC(A) that in the presence of two witnesses stock was physically and properly taken/verified then according to me provisions of Rule 50 stand duly complied with. Therefore, the Tax Board was unjustified in observing about this issue. What made the Tax Board to reverse this finding about Rule 50 is not clearly borne out from the order of the Tax Board. Though affidavit so filed by the respondent does have its own sanctity and value and is normally being accepted on the face value but in a case like this, it looses significance when even at the stage of first appellate authority, the respondent did not produce the relevant books of accounts supporting bills, builties and vouchers then according to me, the evidentiary value of the affidavit is lost. This Court is aware of the value of affidavit but in the instant case it can be said to be a self serving statement only. Had the respondent produced the supporting material like bills, builties, vouchers and also the books of accounts, in support of his claim then possibly version and the facts pleaded in the affidavit would have helped immensely to the respondent but all these are lacking in this case. Had grievance about pressurizing tactics/coercion inflicted upon him (respondent), then the necessary course before the respondent-assessee was to have immediately approached the higher administrative authority namely the Commissioner of Commercial Taxes Department rather then sleeping over the matter and merely filing an affidavit before learned DC(A) much later on point of time. It is very relevant here to observe that while order of imposing the penalty was passed on 19.1.2004, the appeal was decided on 22.3.2007 therefore, during the intervening period of almost about three years, no action whatsoever was taken by the respondent about pressurizing tactics/coercion by the Assessing Officer, during the course of survey and filing an affidavit is merely for the sake of filing of an affidavit.
10. I have gone through the judgment relied upon by the learned counsel for the respondent and find that the facts of the said case are totally distinguishable to the facts and circumstances of the present case.
11. In view of the above discussions and the facts and circumstances of the instant case, the penalty is sustained and the order of the Tax Board is quashed, set-aside and reversed.
12. Resultantly, the Sales Tax Revision Petition as well as the stay application are allowed.
13. No costs.
(Jainendra Kumar Ranka),J.
All Corrections made in the Judgment/Order have been incorporated in the Judgment and Order being emailed.
RK BhattPSJW