UPTRON POWERTRONICS LIMITED Vs. COMMISSIONER OF SALES TAX

JUDGEMENT

(1.) These two revisions arise out of a common order of the Tribunal dated 26.7.1991 passed in two appeal Nos. 527 and 528 of 1986 for the assessment year 1984-85 (U.P. and Central).

(2.) Both the revisions arise out of a penalty order passed under Section 15A(1)(a) of the U.P. Sales Tax Act (hereinafter referred to as the Act) for the assessment year 1984-85 (U.P. and Central), for not depositing the admitted amount of tax alongwith the return within the prescribed period due for the month of December, 1984. The applicant deposited the admitted tax for the month of December, 1984 on 31st January, 1995 by means of cheque drawn on Overseas Bank, Ghaziabad. The applicant simultaneously on 31.3.1985 directed the Indian Overseas Bank, New Delhi to transfer a sum of Rs. 5 Lakhs to Ghaziabad Branch, as the said Ghaziabad Branch had insufficient fund. The cheque presented by the department was not honoured by the Bank due to insufficiency of funds. The department consequently initiated penalty proceedings under the aforesaid section for failure of the applicant to deposit the tax due under the Act alongwith the return as required under the provisions of the Act. In reply to the show cause notice the applicant came out with the case that it has been issuing cheques payable at Ghaziabad for the last 3-4 months as directed by the Assessing officer. The Bank at Ghaziabad received funds only by way of transfer from Delhi as the dealer never deposited the payment received against the sales or otherwise in the Ghaziabad bank and as soon as it had submitted the cheque for the month of December, 1984, a request to the Bank, New Delhi vide letter dated 31st January, 1985 received by them on 1st of February, 1985, to transfer the amount to Ghaziabad was made. But due to negligence on the part of the bank the amount could not be transferred, resultantly the cheque was dishonoured and soon as the dealer came to know about the negligence of the banker, it immediately deposited the amount voluntarily by bank draft alongwith interest.

(3.) The cause shown by the dealer was not found satisfactory and therefore a penalty around 10 per cent of the tax was levied. This order was set aside in appeal by the First Appellate Authority. The Tribunal in further appeal filed by the department set aside the order of the First Appellate Authority and restored back the penalty order.