Surendra Steel Sales vs Deputy Excise and Taxation Commissioner (Appeals) - Cum-Joint Director (Investigation)

Ajay Kumar Mittal, J.—Delay of 5 days in refiling the appeal is condoned. This appeal has been preferred by the assessee u/s 68 of the Punjab Value Added Tax Act, 2005 (in short "the Act") against the order dated 22.11.2013 (Annexure A-3) passed by the Value Added Tax Tribunal, Punjab (hereinafter referred to as "the Tribunal"), order dated 22.2.2013 (Annexure A-2) passed by respondent No. 1 and order dated 1.8.2012 (Annexure A-1) passed by respondent No. 2, claiming the following substantial questions of law:--

(i) Whether any order of penalty can be passed on the presumption that there was an attempt to evade tax?

(ii) Whether, in the facts and circumstances of the case, when proper and genuine documents have been produced, an order of penalty u/s 51 of the Punjab Value Added Tax Act, 2005, could be passed?

(iii) Whether, in the facts and circumstances of the case, an order of penalty u/s 51 of the Punjab Value Added Tax Act, 2005 could be passed due to inadvertent clerical mistake on the part of appellant?

Briefly stated, the facts necessary for adjudication of the instant appeal as narrated therein may be noticed. The appellant is a proprietorship concern. On 24.7.2012, vehicle No. CH-04J-0704 loaded with Iron Plates voluntarily reported at Information Collection Centre (ICC), Zirakpur. The said material was detained u/s 51(6)(a) of the Act by the Barrier Authorities for verification of transaction. Respondent No. 2 vide order dated 1.8.2012 (Annexure A-1) imposed the penalty of Rs. 1,70,900/- under Sections 51(7)(b) and 51(12) of the Act. Feeling aggrieved, the appellant filed an appeal before respondent No. 1 who vide order dated 22.2.2013 (Annexure A-2) dismissed the appeal. Still dissatisfied, the appellant approached the Tribunal by way of an appeal. The Tribunal vide order dated 22.11.2013 (Annexure A-3) upheld the penalty and dismissed the appeal. Hence, the present appeal.

We have heard learned counsel for the appellant and perused the record.

The Assessing Officer while imposing penalty of Rs. 1,70,900/- on the assessee had noticed as under:--

A notice was issued by the undersigned to M/s. Surendra Steel Sales, Chandigarh for appearing on 01.08.2012. Sh. Mukesh Gupta has appeared today in response to the notice issued by the undersigned. The goods were detained on the ground that these were not covered by proper and genuine documents as these were loaded from Zirakpur whereas the bill was issued from Chandigarh. He has been confronted with these facts of the case. As per record he has produced invoice No. 15105 dated 24.07.2012 issued by M/s. Surendra Steel Sales, Zirakpur. It is not denied by the owner of the goods that this bill was issued after the detention of the goods. The only explanation submitted on 27.07.2012 was that the accountant has inadvertently issued invoice of Chandigarh Branch. No other explanation in this regard has been put forth by the owner of the goods. It is an admitted fact that the goods were loaded from Zirakpur but no bill was issued by the said branch. Rather bill was issued by the Chandigarh branch. From the overall facts and circumstances of the case, it is held that the goods are not covered by proper and genuine documents and by issuing invoice from Chandigarh and loading the goods from Zirakpur an attempt to evade the tax of Punjab State has been made. Thus, I impose penalty of Rs. 1,70,900/- u/s. 51(7)(b) and 51(12) of Punjab Value Added Tax Act, 2005.

On appeal, the Commissioner (Appeals)-cum-Joint Director (Investigation), Patiala Division, Patiala had held as under:--

Sh. Harminder Singh, Advocate/Counsel for the appellant and Sh. Amit Singh, ETI, ICC, Zirakpur has appeared from the department with the record file on 22.02.2013. The learned counsel pointed out that this transaction is voluntarily disclosed at concerned ICC. Due to some oversight the pre-printed computerized stationary of Chandigarh branch was issued instead of the stationary of Zirakpur branch. The serial number of bill used is different for Chandigarh branch and Zirakpur branch and this bill was from the Serial Number used by Zirakpur branch only. As this transaction was voluntarily disclosed and there could be no attempt to evade tax, the ETI pointed out that there was an attempt to evade the tax. There could not be mistake of using stationary of Chandigarh instead of Patiala but on the basis of G.R. it came to notice that goods are going from Zirakpur not Chandigarh. This transaction was detected in time. Had it pass the ICC, the Zirakpur firm could easily say that it was not the bill of his firms. So attempt to evade tax is there. After hearing both the parties it is clear that the use stationary of Chandigarh office was intentional with a view to evade the tax. So the appeal is dismissed.

The Tribunal has upheld the penalty with the following observations:--

The thrust of the arguments of Mr. Harminder Singh, Advocate is that M/s. Surendra Steel Sales, Chandigarh is having its branch office at Zirakpur. After examining the departmental file, it is found that there are two invoices bearing the same serial No. i.e., 15105 dated 24.7.2012. Of these, one has been issued by Surendra Steel Sales, Zirakpur (Punjab) and the other one purports to have been issued by Surendra Steel Sales, Chandigarh. Both these parallel invoices purport to have been prepared on the printed form. To my mind, the explanation furnished on behalf of the appellant-dealer is implausible. Rule 55(3) of the Punjab Value Added Tax Rules, 2005 read as under:-

55(3). A retail invoice shall carry the following details:-

(a) a consecutive serial number, printed by a mechanical or electronic process.

(b) The date of issue.

(c) The name, address and registration number of the selling person.

(d) Full description of the goods.

(e) The quantity of the goods.

(f) The value of the goods per unit.

(g) The total value.

(h) Signature of proprietor or partner or direction or/authorized agent.

As per the above mentioned Rule, a consecutive serial No. is to be printed by a mechanical or electronic process on the invoice. If it was so, how two parallel invoices could be issued bearing the same Sr. No. and date by Surendera Steel Sales. The Excise and Taxation Officer-cum-Designated Officer, ICC, Zirakpur (Punjab) in his order dated 1.8.2012 has observed as under:-

The goods were detained on the ground that these were not covered by proper and genuine documents as these were loaded from Zirakpur whereas the bill was issued from Chandigarh. He has been confronted with these facts of the case. As per record he has produced invoice No. 15105 dated 24.07.2012 issued by M/s. Surendra Steel Sales, Zirakpur. It is not denied by the owner of the goods that this bill was issued after the detention of the goods. The only explanation submitted on 27.07.2012 was that the accountant has inadvertently issued invoice of Chandigarh Branch. No other explanation in this regard has been put forth by the owner of the goods. It is an admitted fact that the goods were loaded from Zirakpur but no bill was issued by the said branch. Rather bill was issued by the Chandigarh branch. From the overall facts and circumstances of the case, it is held that the goods are not covered by proper and genuine documents and by issuing invoice from Chandigarh and loading the goods from Zirakpur an attempt to evade the tax of Punjab State has been made.

To my mind no exception can be taken to the above observations. Consequently, the penalty is upheld and this appeal being devoid of any merit is dismissed.

From the above, it emerges that the Assessing Officer, the Commissioner (Appeals) and the Tribunal had come to the conclusion that there was an attempt to evade tax and that there were two invoices of same number and date, i.e. Sr. No. 15105 dated 24.7.2012. Out of the aforesaid two invoices of the same serial numbers, one was issued by Surendra Steel Sales, Zirakpur (Punjab) and the other one was issued by Surendra Steel Sales, Chandigarh and this parallel invoices had been prepared on the printed form. It was not disputed by the owner of the goods that bill No. 15105 dated 24.7.2012 was issued by Surendra Steel Sales, Zirakpur after the detention of the goods. The explanation furnished by the appellant-dealer was held to be not plausible. The finding of fact could not be shown to be perverse and the view taken by the authorities below was a possible view which cannot be faulted. In such circumstances, it cannot be said that any substantial question of law arises in this appeal. In view of the above, finding no merit in this appeal, the same is hereby dismissed.