STATE OF TAMIL NADU Vs. AFRA CAR JEWELS

JUDGEMENT

(1.) The above tax revision is preferred by the Department aggrieved against the order passed by the Tamil Nadu Sales Tax Appellate Tribunal (Main Bench), Chennai in T.A. No.112/2013.

(2.) This revision is filed questioning the order of the Tribunal declining to interfere with the levy of penalty under Section 27 (3) of the Tamil Nadu Value Added Tax Act in a case of alleged violation of Section 27 (1) (a).

(3.) It appears that for the assessment year 2011-2012, in the middle of the assessment year, there was a surprise inspection by the officers of the department on 14.7.2011. During the said inspection, it was noticed that there was variation in the stocks to a certain extent and the assessee had not paid taxes due on a specified amount. The assessee, on realising that tax was due on certain turnover for the said period, during the currency of the assessment year, paid the taxes without demur. However, the officer passed an order under Section 27 (3) imposing penalty in terms of Sections 27 (1) (a) and 27 (3) of the Act. According to the department, they were satisfied that the assessee had willfully not disclosed assessable turnover and, therefore, the assessee is liable to penalty in terms of Section 27 (3) of the Act. The said order of penalty was challenged before the Appellate Deputy Commissioner, who held in favour of the assessee against which, the Revenue preferred appeal before the Tribunal. The Tribunal, on considering the case, came to the conclusion that there was no original assessment and, therefore, the question of escapement of assessment would not arise. Since there was no original assessment order passed under Section 22 (2) of the Act, invocation of Section 27 (1) (a) and, consequently, Section 27 (3) does not arise. In coming to the said conclusion, the Tribunal held as follows :-