KAMLA TRUST Vs. COMMISSIONER OF SALES TAX

JUDGEMENT

(1.) This is a revision Under Section 11 of the U.P. Sales Tax Act, 1948 (hereinafter referred to as "the Act") against the order of Tribunal dated September 27, 1991 for the assessment year 1982-83.

(2.) The applicant was manufacturer of rice. The paddy was raw material for the manufacturing of rice. Being the manufacturer, the applicant was holding recognition certificate Under Section 4-B of the Act. During the year under consideration, applicant had purchased paddy from registered dealer to the extent of Rs. 27,96,201.94 and from unregistered dealer to the extent of Rs. 63,51,081.79 in all for Rs. 91,47,283.73. Applicant being the recognition certificate holder Under Section 4-B of the Act has not paid any tax on the purchases of paddy. Out of paddy purchased in respect of which benefit of exemption was availed Under Section 4-B, rice was manufactured, which was sold inside the State of U.P. and had also been despatched outside the State of U.P. for sale on consignment basis for Rs. 28,63,298.93. Section 4-B(2) of the Act contemplates that manufactured rice should be sold either in the State of U.P. or in the course of inter-State sales or export. Since the applicant had despatched rice outside the State of U.P. for sale on consignment basis to the extent of Rs. 28,63,298.93 there was violation of Section 4-B(2) of the Act. The assessing authority initiated the penalty proceeding for the violation of Section 4-B(2) of the Act and after considering the reply of the applicant levied the penalty at Rs. 2,25,000. The assessing authority observed that the minimum penalty leviable was at Rs. 1,14,532.96 which was the tax on the amount of Rs. 28,63,298.93. The applicant filed the appeal before the Deputy Commissioner (Appeals) which was dismissed. The applicant filed second appeal before the Tribunal, which was also dismissed. Being aggrieved by the order of Tribunal, the present revision has been filed.

(3.) I have heard Sri Bharat Ji Agrawal, learned Senior Advocate assisted by Sri Piyush Agrawal, learned Counsel for the applicant and Sri B.K. Pandey, learned Standing Counsel.