DELTA LUBRICANTS Vs. DEPUTY COMMERCIAL TAX OFFICER VIJAYAWADA

JUDGEMENT

(1.) AN order of assessment and a notice issued in form VAT 305 are challenged by this writ petition. The tax under-declared due to tax department was Rs. 4,28,800 and penalty imposed was Rs. 5,78,699, total demand of Rs. 10,07,499 has been raised. The notice is challenged mainly on the ground that the provisions of law were not followed while making the assessment. The petitioner claimed to have submitted his monthly returns for the period from April to November, 2005 in form VAT 200 and paid the tax due on such sales turnover after claiming input tax credit in terms of section 13 of the VAT Act. The respondent served a notice in form VAT 304 on November 8, 2005 on the petitioner. The petitioner's business premises was visited by the respondent and the books of accounts maintained by the petitioner were also examined. On the basis of such perusal of the books of accounts, the respondent issued a notice of assessment in form VAT 305 on November 10, 2005 proposing to assess the petitioner for the period from April 1, 2005 to November 8, 2005 on the alleged under-declared tax of Rs. 6,23,960 and also to levy penalty of Rs. 6,23,960 equivalent to 100 per cent of the alleged under-declared tax amount. An explanation was given. The issues raised in this case relate to mainly factual issues, whether any tax was due from the petitioner or not; whether he had under-valued or not; and whether he had paid deficit amount of tax. Notice was given, objections were invited and after consideration, the impugned order was passed and the petitioner has an efficacious remedy by way of appeal. Therefore as far as assessment is concerned, this court would not be in a position to concede to the request of the petitioner to quash the assessment. But, at the same time, this court has found, as it has been argued, that the tax as well as penalty could not be imposed by the same order. In this connection reference is made to section 53 of the Andhra Pradesh Value Added Tax Act 2005. Section 53 lays down the procedure for levying penalty for failure to declare tax due. Under section 53 (3) it is stated :

(2.) NOTICE in form VAT 305a demands tax of Rs. 12,47,920 which includes penalty of Rs. 6,23,960. The petitioner was asked to file objections within seven days. There is no finding in the notice that the dealer had under-declared tax and committed fraud or wilful neglect which is essential ingredient of section 53 (3) of the VAT Act. Even in the order passed it is nowhere stated that under-declared value was result of fraud or wilful neglect. Therefore, in our view, the penalty imposed was without jurisdiction.

(3.) THE provision was altogether different which was being interpreted by the Full Bench of this court. Even otherwise, it held :