Punjab-Haryana High Court
M/S Lg Electronics India Pvt. Limited vs The State Of Punjab And Another on 3 December, 2013
Author: Ajay Kumar Mittal
Bench: Ajay Kumar Mittal, Jaspal Singh
VATAP No.16 of 2012 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
VATAP No.16 of 2012(O&M)
Date of decision: 3.12.2013
M/s LG Electronics India Pvt. Limited
-----Appellant
Vs.
The State of Punjab and another
----Respondents
CORAM:- HON'BLE MR. JUSTICE AJAY KUMAR MITTAL
HON'BLE MR. JUSTICE JASPAL SINGH
Present:- Mr. Sandeep Goyal, Advocate for the appellant.
Mr. N.K.Verma, Sr.DAG, Punjab.
----
Ajay Kumar Mittal,J.
1. This appeal has been preferred by the assessee under Section 68 of the Punjab Value Added Tax Act, 2005 (in short, "the Act") against the order dated 28.11.2011, Annexure A.7, passed by the Value Added Tax Tribunal, Punjab, Chandigarh (in short, "the Tribunal") in Appeal No.59 of 2011. It was admitted on 5.9.2012 to consider following substantial questions of law:-
"i) Whether on the facts and in the circumstances of the case, the learned Tribunal was justified in upholding the penalty under Section 51(7) (b) merely on account of clerical mistake in the documents which were produced voluntarily at ICC, without establishing any attempt to evade the tax?
(ii) Whether on the facts and in the circumstances of Singh Gurbax 2013.12.21 14:28 I attest to the accuracy and integrity of this document High Court Chandigarh VATAP No.16 of 2012 2 the case, the learned Tribunal was justified in not following its own judgment on the similar issue despite the fact that it was delivered by the same Member?"
2. A few facts relevant for the decision of the controversy involved, as narrated in the appeal, may be noticed. The assessee is a private limited company manufacturing Electronic goods, colour TV, air conditioners and refrigerators in India and has country wide network with branches including the one at Ludhiana. It also sends the goods on stock transfer basis to various branches from its head office at Noida. It sent 184 sets of colour TV to its Ludhiana branch on stock transfer basis. The driver of the vehicle produced the documents at ICC Shambu (Import). The officer on duty detained the goods on the ground that no invoice for 23 number of TV sets meant for Ludhaina was accompanying the goods. In response to the detention notice, the representative of the assessee appeared before the officer and submitted that the goods were meant for Ludhiana but the address of consignee firm was wrongly mentioned as the Code in the computer was selected as "LUC" instead of "LUD" but there was no intention to evade tax. The Assistant Excise and Taxation Commissioner (AETC) after considering the matter vide order dated 2.12.2009, Annexure A.4 imposed penalty of ` 1,04,390/- under Section 51(7) (c) and ` 26098/- under Section 51(12) of the Act on the ground that there was attempt to evade the payment of tax as no invoice for 23 sets of TV was being carried by the driver of the vehicle. Aggrieved by the order, the assessee filed an appeal before Singh Gurbax 2013.12.21 14:28 I attest to the accuracy and integrity of this document High Court Chandigarh VATAP No.16 of 2012 3 the Deputy Excise and Taxation Commissioner (DETC). Vide order dated 2.11.2010, Annexure A.5, the appeal was dismissed. Still not satisfied, the assessee filed appeal before the Tribunal. Vide order dated 28.11.2011, Annexure A.7, the appeal also met the same fate. Hence the present appeal by the assessee.
3. Learned counsel for the appellant submitted that two invoices No. 10137174 and 10137172 dated 13.11.2009 (Pages 11/A and 12/A of the paper book) had been sent by the appellant alongwith the goods. Through the second invoice i.e. 10137172, 23 colour TV sets had been sent from its office at Greater Noida to Ludhiana but due to mistake in the computer, the destination was mentioned as Lucknow whereas the GR which was sent alongwith the invoice showed the destination as Ludhiana.
4. On the aforesaid premises, it was argued that in case there was attempt to evade tax, the appellant would not have furnished invoice 10137172 for ` 2,08,780/- relating to 23 colour TVs being sent from Greater Noida to Ludhiana. It was also urged that the same member of the Tribunal in his earlier decision in M/s Karwa Consolidated Marketing Limited v. State of Punjab, Appeal No.142 of 2011 decided on 12.9.2011, Annexure P.8, following State of Punjab v. Whirlpool India Limited, Zirakpur, District Mohali, (2009) 34 PHT 125 (PVT) under similar circumstances, had held the dealer not to be liable for penalty.
5. On the other hand, learned counsel for the respondents besides supporting the order passed by the Assessing authority as Singh Gurbax 2013.12.21 14:28 I attest to the accuracy and integrity of this document High Court Chandigarh VATAP No.16 of 2012 4 affirmed by the first appellate authority and the Tribunal submitted that the penalty was rightly levied as there was attempt on the part of the dealer to evade tax in as much as in Invoice No.10137172, the destination was shown as Lucknow whereas the goods had been sent to Ludhiana.
6. Amended substantial questions of law were filed by the appellant which are as under:-
"i) Whether on the facts and in the circumstances of the case, the learned Tribunal was justified in upholding the penalty under section 51(7) (b) on account of deficiency in the documents with regard to correct name and address of consignee, despite the fact that documents were produced voluntarily at the ICC, which rules out any evasion of tax?
ii) Whether on the facts and in the circumstances of the case, the learned Tribunal was justified in not following its own judgment on the similar issue despite the fact that it was delivered by the same member?"
7. After hearing learned counsel for the parties, we find force in the submissions made by learned counsel for the appellant. The explanation furnished by the appellant appears to be bonafide and under the circumstances, it cannot be said that there was any attempt to evade tax. The goods in question were transported from Greater Noida to Ludhiana whereas in the documents, it was mentioned as Lucknow. The appellant had submitted that the Code mentioned in the computer for Lucknow was 'LUC' whereas for Ludhiana it was 'LUD'. It was by mistake that 'LUC' was pressed and printed instead of 'LUD' and therefore inadvertent mistake had Singh Gurbax 2013.12.21 14:28 I attest to the accuracy and integrity of this document High Court Chandigarh VATAP No.16 of 2012 5 occurred. The appellant had produced the following documents before the ETO on duty:-
"1.Invoice No.10137174 dated 13.11.2009 for `1255154 issued by M/s L.G.Electronics India Pvt. Limited Greater Noida in favour of M/s L.G.Electronics India Pvt. Limited, Ludhiana.
2. Invoice No.10137172 dated 13.11.2009 for `208780 issued by M/s L.G.Electronics India Pvt. Limited greater Noida in favour of M/s L.G. Electronics India Pvt. Limited. Central Warehousing Corporation, Sitapur Road, Lucknow.
3.G.R.No.146715 dated 14.11.2009 of M/s Coastal Roadways Limited, Kolkata from Greater Noida to Ludhiana.
4. Packing list."
If there was intention on the part of the appellant to evade tax, it would not have voluntarily furnished Invoice No.10137172 for `2,08,780/- in respect of 23 Colour TVs which were dispatched from Greater Noida to Ludhiana. It was not disputed that the driver of the vehicle had presented both the invoices i.e. No.10137174 and 10137172 in respect of the goods amounting to ` 12,55,154/- and ` 2,08,780/- respectively. One consolidated GR No.146715 from Greater Noida to Ludhiana alongwith the packing list was also presented. In such circumstances, it could not be said that there was an attempt to evade tax. Moreover, there was no tax liability at the stage of entry of goods in the State of Punjab as they were coming from Greater Noida to the branch at Ludhaina. The Tribunal had taken different view from the one as had been taken in M/s Karwa Singh Gurbax 2013.12.21 14:28 I attest to the accuracy and integrity of this document High Court Chandigarh VATAP No.16 of 2012 6 Consolidated Marketing Limited's case (supra) under similar circumstances without giving any reasons. No justification has been pointed out for adopting different approach.
8. In view of the above, the substantial questions of law are answered in favour of the assessee and against the revenue. The appeal stands allowed.
(Ajay Kumar Mittal)
Judge
December 03, 2013 (Jaspal Singh)
'gs' Judge
Singh Gurbax
2013.12.21 14:28
I attest to the accuracy and
integrity of this document
High Court Chandigarh