Karnataka High Court
M/S Jai Hind Ply, vs The Additional Commissioner Of ... on 5 February, 2018
Bench: S.Sujatha, John Michael Cunha
IN THE HIGH COURT OF KARNATAKA R
DHARWAD BENCH
DATED THIS THE 05TH DAY OF FEBRUARY, 2018
PRESENT
THE HON'BLE MRS. JUSTICE S. SUJATHA
AND
THE HON'BLE MR. JUSTICE JOHN MICHAEL CUNHA
S.T.A NO.501/2013
BETWEEN:
1. M/S JAI HIND PLY,
NO. 27/1, SOMWAR PETH,
SHOP NO. 9 & 10, AMAR CENTRE,
15TH AUGUST CHOWK, PUNE-411011,
(REPRESENTED BY ITS
PROP SRI. RAMESH OSWAL)
...APPELLANT
(BY SRIYUTHS ATUL K ALUR, N.P. VIVEKMEHTA,
& H.R. KAMBIYAVAR, ADVS.)
AND:
1. THE ADDITIONAL COMMISSIONER OF COMMERCIAL,
TAXES ZONE II, VANIJYA THERIGE KARYALAYA,
GANDHINAGAR, BANGALORE-9.
...RESPONDENT
(BY SRI. M. KUMAR, AGA)
THIS APPEAL IS FILED U/SEC.66(1)OF THE KVAT ACT,
AGAINST THE ORDER DTD:06-11-2012 PASSED IN
T.NO.341/12-13 ON THE FILE OF THE ADDL. COMMISSIONER
OF COMMERCIAL TAXES, ZONE-II BANGALORE, ORDER
PASSED BY THE JOINT COMMISSIONER OF COMMERCIAL
TAXES (APPEALS) BELGAUM DIVISION, BELGAUM VIDE
VAT.AP.BG.229/2006-07, DTD:18-04-2007 IS SET ASIDE AND
THE ORDER OF PENALTY PASSED BY THE CPO, KOGANOLLI,
ON 14-02-2007 IS UPHELD.
THIS APPEAL COMING ON FOR FINAL HEARING THIS DAY,
S.SUJATHA J., DELIVERED THE FOLLOWING:
:2:
JUDGMENT
This appeal is filed by the assessee challenging the legality and correctness of the order passed by the Additional Commissioner of Commercial Taxes, Zone-II, Bangalore, dated 6.11.2012.
2. The appellant is a proprietorship concern, engaged in sale of Plywood, Timber, Flesh doors, Roofing Sheets, Vener Hardware and interior decoration materials. The appellant firm is registered under the provisions of Maharashtra Value Added Tax Act. The appellant's place of business is Pune. The goods vehicle bearing No.RJ-04-GA-1319 was intercepted by Commercial Tax Officer, STCP, Koganolli on 10.02.2007, while moving from Pune to Bangalore carrying wood valued at Rs.5,78,358/-. The persons in charge of the goods vehicle tendered invoice issued by M/s. Jai Hind Ply, Pune(appellant) in favour of M/s. Greenline, Bangalore. Upon verification of invoice, the Commercial Tax Officer STCP observed that since full particulars of consignee namely Greenline, Bangalore is not :3: forthcoming with TIN number suspecting the transaction, issued endorsement dated 10.02.2007, wherein the authority directed to produce VAT 100 of the consignee. After issuance of the endorsement, check post officer has issued notice under Section 53(12) of the Karnataka Value Added Tax, 2003 (for short, 'the KVAT Act') stating that the driver in-charge of the goods vehicle has produced the tax invoice, which reflects the value of the goods, but details of the consignee is not forthcoming. The person in-charge of the goods vehicle appeared and pleaded that the penalty proposed was too heavy, as the goods have already suffered tax @ 12.5% at the hands of the seller and requested to reduce the quantum of penalty. Considering the same, the check-post officer levied penalty of Rs.1,44,590/- as against the proposal levied of Rs.2,16,884/-. Aggrieved by the same, the appellant preferred statutory appeal before the appellate authority. The appellate authority allowed the appeal, against which suo-moto proceedings were initiated :4: under Section 66(1) of the KVAT Act by the revisional authority. After issuance of notice and considering the reply filed, revision order was passed setting-aside the order of the appellate authority restoring the original penalty order passed by the check-post officer, Koganolli. Being aggrieved by the same, the appellant has preferred this appeal.
3. Sri. Atul K. Alur, learned counsel appearing for the appellant would contend that the revisional authority without application of mind proceeded to pass the order impugned herein; no reasons are assigned by the revisional authority to set-aside the appellate order and to restore the original order of penalty. Indeed, the revisional authority has reproduced the reply and facts and confirmed the order passed by the check-post officer; when there was no evasion of tax, the penalty cannot be levied. The appellant had raised invoice in favour of M/s. Poonam Timber Industries, Bangalore. The transaction is interstate sales and not the local sales, as such the revisional authority has no :5: jurisdiction to revise the order. The revisional authority was not right in rejecting the invoice copy in favour of M/s. Green Line, Bangalore, when the dealer was not registered under the local Act, question of filing VAT-100 does not arise. Since the earlier dealer had rejected the goods in question, as a prudent businessman, he found the local dealer and sold the goods, instead of taking back goods to Pune by reducing the price. In such circumstances, the revisional authority ought not to have interfered with the appellate order.
4. Sri. M. Kumar, learned AGA appearing for the respondent-State supporting the impugned order would contend that in terms of the invoice placed on record before the check-post officer, goods were moving from Pune to Bangalore. The details of the consignee, Greenline, Bangalore was not forthcoming in the invoice. Since the required documents were not produced before the check-post officer, levying of the penalty was legal. However, erroneously the appellate :6: authority has set aside the penalty order. The same being erroneous and prejudicial to the interest of the Revenue, revisional authority invoked the provision of Section 64 of the KVAT Act to revise the order of the appellate authority which is justifiable and the same does not call for any interference by this Court.
5. We have heard the learned counsel appearing for the respective parties and perused the material on record.
6. Section 53(12) of the KVAT Act contemplates that the officer in charge of a check-post or a barrier or any other officer, in respect of any contravention of, or noncompliance with, the provisions of sub-section (2), for which sufficient cause is not furnished, levy a penalty which.- i) shall not be less than the amount of tax leviable but shall not exceed one and half of the amount of tax leviable in respect of the goods under transport in contravention of clause (c) or cause (d) of sub-section (2), if a dealer registered under the Act :7: accepts that he is the consignor or consignee of the goods. ii) in cases other than those falling under item(i), shall not be less than double the amount of tax leviable but not exceed three times the amount of tax leviable in respect of the goods under transport.
7. Section 53(2) of the Act contemplates that the owner or person in charge of a good vehicle or a boat, ship or similar vessel shall: a) carry with him a goods vehicle record, a trip sheet or a log book, as the case may be; and b) carry with him such documents as may be prescribed, or notified by the Commissioner in respect of the goods carried in the goods vehicle or boat, ship or similar vessel.
8. Rule 157 of the KVAT Rules describes the documents to be carried in terms of sub-section (2) of Section 53 of the KVAT Act and the same reads thus:
"a) delivery note in Form VAT 505, issued by the owner or the consignor of goods, in respect of such goods as may be notified by the :8: Commissioner an where the goods carried as a result of sale, a tax invoice or a bill of sale.
a) a tax invoice or a bill of sale where the goods are carried as a result of sale and are not covered by clause (a); and
b) a delivery note in Form VAT 505, issued by the owner or consignor of goods of Form VAT 515, issued by the owner or the consignor of goods, who is a dealer permitted to issue such delivery note in Form VAT 515 as may be notified by the Commissioner subject to such conditions as specified where the goods carried are not covered by clause(a)".
9. Tax invoice or bill of sale is a necessary document to be carried, where the goods are carried as a result of sale. Tax invoice as defined under Section 2(32) of the KVAT Act, is a document specified under Section 29, with the description of listing goods sold with price, quantity and other information as prescribed.
10. Section 29 of the KVAT Act deals with the tax invoices and bills of sale, which reads thus: :9:
"A registered dealer effecting a sale of taxable goods or exempt goods along with any taxable goods, in excess of the prescribed value, shall issued at the time of the sale, a tax invoice marked as original for the sale, containing the particulars prescribed, and shall retain a copy thereof".
11. Rule 29 of the KVAT Rules deals with the particulars of tax invoice. In terms of the said Rules, the tax invoice shall contain the following details, namely:-
a) a consecutive serial number;
b) the date of its issue;
c) the name, address and registration number (TIN) of the selling dealer;
d) the name, address and registration number (TIN) if registered, of the buyer;
e) a full description of the goods;
f) the quantity of the goods;
g) the value of the goods;
h) the rate and amount of tax charged in respect of taxable goods;
i) the total value; and
j) signature of the selling dealer or his agent.: 10 :
12. Invoice should mandatorily contain the particulars as prescribed in Rule 29, which is lacking herein. Admittedly, tax invoice carried by the person in- charge of the goods vehicle in question as found at the time of interception was not in conformity with the provisions prescribed. The goods were moving from Pune to Bangalore without the required documents as contemplated under Section 53(2)(b) of the KVAT Act. Hence, the check post officer was justified in levying penalty. However, the appellate authority proceeded to set aside the said order without appreciating the mandatory requirements of KVAT Act and Rules as aforesaid. The same being erroneous and prejudicial to the interest of the revenue, the revisional authority invoking the provisions of Section 64(1) of the KVAT Act is justifiable. The contention of the appellant that after payment of penalty on 14.02.2007, consignee having rejected the goods, the same were delivered to M/s Poonam Timber Industries Bangalore who is a registered dealer in the State against the invoice of the consignor : 11 : cannot be accepted since the said transaction is not falling under Section 6(2) of CST Act, 1956 and no such documents were produced before the check post officer.
13. The contention of the learned counsel for the appellant that no reasons are assigned by the revisional authority while confirming the order of the check post officer setting aside the appellate order is wholly obnoxious and untenable. In para 4 of the order, the revisional authority has crystallized the case of the appellant and given satisfactory reasons for setting aside the appellate order.
14. No grounds are made out by the appellant to interfere with the well reasoned order of the respondent. No question of law arises for consideration in this appeal.
Accordingly, the appeal stands dismissed.
Sd/-
JUDGE Sd/-
JUDGE JTR/MBS/-