BHARAT SANCHAR NIGAM LTD Vs. STATE OF BIHAR

JUDGEMENT

(1.) HEARD Mr. L.N. Rastogi, counsel for the petitioner and the Advocate General appearing on behalf of the State.

(2.) THE petitioner M/s. Bharat Sanchar Nigam Limited is aggrieved by and seeks to challenge the order, dated 22.3.2006 by which the Assistant Commissioner of Commercial Taxes, Patliputra Circle, Patna, imposed on it the penalty of Rs. 3,50,37,414.82 under Section 25(ka) of the Bihar Finance Act, 1981 and Section 41(1) of the Value Added Tax Act, 2005. He gave a notice to the petitioner to show cause why a penalty under the aforesaid provisions may not be imposed on it for its failure to make deductions of advance tax from the bills of its works-contractors before payment of their bills. A photo stat copy of the notice is at Annexure 5 from which it appears that it was issued by the Assistant Commissioner, Commercial Taxes on 16.3.2006 asking the petitioner to appear before him on 22.3.2006 at 11 in the morning. According to the petitioner, it was received in its office on 20.3.2006 and it came to the concerned department on 21.3.2006 i.e. barely twenty four hours (or even less) before the time fixed for appearance before the authority. A representative of the petitioner appeared before the Assistant Commissioner and also filed a show cause in response to the notice. A copy of the show cause is annexed to the counter affidavit filed by the respondents. It is a brief show cause only stating that the petitioner had informed its two works-contractors, namely, M/s. Ericsson India Pvt. Ltd. and M/s. Nortel Networks (I) Pvt. Ltd. about its intention to deduct advance tax from their bills if they failed to submit by 22.03.2006 the necessary Sales Tax exemption certificate issued by the concerned authorities. It was further stated in the show cause that in case they failed to submit the tax exemption certificate it would deduct advance tax from their bills and deposit it as directed. By all means it appears to be a perfunctory petition hurriedly prepared without a proper examination of all aspects of the matter.

(3.) WE are, therefore, of the view that the proceeding was held in an over-wrought manner and the case of the petitioner failed to receive a proper and objective consideration because the authority was unduly anxious about collection of revenue in that financial year.