STATE OF KARNATAKA Vs. RCI LOGISTICS PRIVATE LIMITED

JUDGEMENT

(1.) THIS revision petition is filed by the State challenging the order passed by the Karnataka Appellate Tribunal setting aside the order of penalty imposed on the assessee on the ground that in law no penalty could be imposed even though the consignment is not unloaded at the point of destination. M/s. RCI Logistics Private Limited is a transport company having its Head Office at Hubli. They were transporting a consignment of 11,280 dozen supra flexi revite (MED) tooth brush, valuing Rs. 4,95,295/ - from Surat to Hubli. The bill was issued in favour of Colgate Palmolive (India) Limited, C/o. Swamy Sons Agencies, Hubli whose TIN Number was 2903050192. Instead of unloading the goods at Hubli, it was carried further beyond Hubli. The vehicle bearing No. KA -40 -4227 was intercepted at Shidlagatta -Kolar Road on 16 -10 -2009. On enquiry, the driver of the goods vehicle explained that these goods have been brought from Surat, Gujarat and he was directed to deliver the goods in Tirchy of Tamil Nadu. Therefore, a notice came to be issued asking him to show cause as to why penalty should not be levied. The contravention being, goods have travelled beyond Hubli on the strength of the bill which was valid only upto Hubli. The reply was filed stating that the driver of the vehicle by mistake carried the vehicle further more towards Tirchy. In the meanwhile, he wanted to see his ailing father in his native place i.e. Shidlagatta. At the time of interception of the goods vehicle, the goods were not been unloaded. This is a transaction from Gujarath to Karnataka against 'C' Form and there was no intention to evade the tax. Neither the consignor nor the consignee had contravened the provisions of Karnataka Value Added Tax Act, 2003. After holding an enquiry the Assessing Authority over ruled the objections and imposed penalty of Rs. 1,85,763/ -. Aggrieved by the said order, the transporter/assessee preferred an appeal to the First Appellate Authority.

(2.) THE First Appellate Authority was of the view that the authorities have failed to establish beyond doubt that there was a clear intention to evade the tax in the State of Karnataka. The transaction in question is not beyond suspicion also. Therefore, he modified the penalty and reduced it to Rs. 1,23,824/ -. Aggrieved by the said order the assessee preferred an appeal.

(3.) THE learned Additional Government Advocate appearing for the State contended that the documents carried by the vehicle shows that the goods were transported from Surat to Hubli. The goods ought to have been unloaded at Hubli. Without unloading at Hubli, the goods were being transported to Tirchy. When the vehicle had been parked in the Kolar Road at Shidlagatta, the vehicle was intercepted. When the driver was called upon to produce the documents, he produced documents to show that the goods were transported from Surat to Hubli, but he had no document to show for transporting the goods from Hubli onwards and therefore, in the light of the aforesaid admitted facts, there is contravention under Section 53(2)(b) and accordingly, the authorities imposed penalty under Section 53(12) of the Act. Merely because, after that interception and commencement of the proceedings, the goods were delivered to the dealer at Hubli and 'C' Forms were issued, makes no difference in law. It also demonstrates a clear intention to evade tax and therefore, he submits the order passed by the Tribunal requires to be set aside.