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M/S Good-Year Shoe Factory v. The Commissioner Of Trade Tax - SALES/TRADE TAX REVISION No. 605 of 1996  RD-AH 1434 (18 November 2004)
TRADE TAX REVISION NO.605 OF 1996
M/s Good-Year Shoe Factory. ....Applicant
The Commissioner of Trade Tax.. ....Opp.party
Hon'ble Rajes Kumar, J.
Present revision under Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act") is directed against the order of Tribunal dated 30.03.1996 relating to the assessment year 1989-90.
Applicant was engaged in the business of manufacturing and sale of shoe-uppers and placed the order for the purchase of wet blue cow hides (semi finished leather) to one M/s Universal Leather Deviapuram, Eroda, (Tamilnadu) and for the import of the goods sent two forms 31 Nos.FW/1989-0665576 and FW/1989-0665577.It appears that M/s Mahajan Tanners Private Limited, sister concern of the applicant also placed orders to M/s Universal Leather Deviapuram, Eroda, (Tamilnadu) for the supply of wet blue cow hides and for the import of the goods they have also sent 2 forms 31 Nos.FW/1989-0681422 and FW/1989-0681423. M/s Universal Leather Deviapuram, Eroda, (Tamilnadu) despatched 115 bundles of wet blue cow hides valuing Rs.3,98,891.31p. against invoice no.61 dated 02.01.1990 in vehicle no.TN-27/X-0023 with the direction to deliver the goods at the premises of M/s Mahajan Tanners Private Limited. It appears that instead of sending the goods against Form-31 of the applicant, Form-31 No.FW/1989-0681422 of M/s Mahajan Tanners Private Limited was filled and given to the driver of the vehicle. In the said Form-31, details of invoice no.61 dated 02.01.1990 issued in favour of the applicant was mentioned. At the check post driver of the vehicle submitted the copy of the invoice, Form-31 and Form-35 relating to the goods. On verification, check post officer found that Form-31 was not of the applicant's firm but was of M/s Mahajan Tanners Private Limited and on this ground, goods were seized. Goods were subsequently released on furnishing of security. In pursuance of the seizure order, penalty proceedings under section 15-A (1) (o) of the Act was initiated on the allegation that the alleged good was being imported without Form-31 in violation of Section 28-A. Applicant filed reply alongwith the affidavit of R. Thangavelu, partner of M/s Universal Leather Deviapuram, Eroda, (Tamilnadu). In the reply, it was submitted that inadvertently instead of using the Form-31 of the applicant, Form-31 of M/s Mahajan Tanners Private Limited was used. In the affidavit, M/s Universal Leather Deviapuram, Eroda, (Tamilnadu) had admitted the mistake on their part. Assessing authority however, had not accepted the plea of the applicant and levied the penalty at Rs.1,59,600/- First appeal filed by the applicant was rejected. Applicant filed second appeal, which was also rejected by the impugned order.
Heard learned counsel for the parties.
Learned counsel for the applicant submitted that the order of the Tribunal confirming the penalty under section 15-A (1)(o) of the Act in the facts and circumstances of the case is unjustified. He submitted that the good was accompanied by bill and Form-31, in which complete details of the good was mentioned. He submitted that only mistake was that instead of using of Form-31 of the applicant, Form-31 of M/s Mahajan Tanners Private Limited was used by mistake by M/s Universal Leather Deviapuram, Eroda, (Tamilnadu), which has been accepted by M/s Universal Leather Deviapuram, Eroda, (Tamilnadu) in their affidavit. He submitted that the good was accompanied by bill and Form-31, hence no case of attempt to evade the tax could be made out. He submitted that the purpose of Form-31 is to bring the transaction to the notice of the department, so that the same may be considered at the time of assessment. He submitted that in case if Form-31 of other party is used inadvertently, goods could not be seized and the penalty can not be imposed. In support of his contention he relied upon the decision in the case of Aster Technologies Private Limited Vs. State of U.P., reported in 1990 STR, 56, in the case of M/s Modi Xeror Limited, Moripur, Rampur Vs. CST, reported in 1995 UPTC, 1014, in the case of CST Vs. S/S Tax Maco Limited, New Delhi, reported in 1999 UPTC, 1031. Learned Standing Counsel supported the order of the Tribunal.
I have perused the order of the Tribunal and the authorities below.
In my opinion, on the facts and circumstances of the case, order of the Tribunal can not be sustained.
Section 28-A (1), and 28-A (6) and 15-A (1) (o) reads as follows "
"Section 28-A. Import of goods into the State against declaration. ---[(1) Any person (hereinafter in this section, referred to as the importer) who intends to bring, import or otherwise receive, into the State from any place without the State, any goods [other than the goods exempt under clause (a) of Section 4] in such quantity or measure or of such value, as exceeds---
(a) (i) twenty kilograms in the case of foodgrains, cereals, pulses, soyabeen, and all products thereof, and all raw materials including resin, rosin or oilseeds used for extracting oils of any kind; and
(ii) rupees fifty, in the case of other goods; or
(b) the quantity, measure or value notified by the State Government in that behalf, in connection with business, shall obtain the prescribed form of declaration on payment of the prescribed fee from the Assessing Authority having jurisdiction over the area where his principal place of business is situated or, in case there is no such place, where he ordinarily resides:
Provided that where the importer intends to bring, import or otherwise receive such goods otherwise than in connection with business, he may, at his option, in the like manner obtain the prescribed form of certificate].
(6) Where the officer making search or inspection under this section finds any person transporting or attempting or abetting to transport any goods to which this section applied without being covered by the proper and genuine documents referred to in the preceding sub-sections and if for reasons to be recorded he is satisfied after giving such person an opportunity of being heard that such goods were being so transported in an attempt to evade assessment or payment of tax due or likely to be due under this Act, he may order detention of such goods.
"Section 15-A(1)(o). Penalties in certain cases. -(1) If the Assessing Authority is satisfied that any dealer or other person--
imports or transports, or attempts to import or transport of abets the import or transport of any goods in contravention of the provisions of Sections 28-A]; or"
The above provision came up for consideration before the Division Bench of this Court in the case of M/s Jain Shudh Vanaspati Ltd., Ghaziabad and others Vs. State of U.P. and others, reported in 1983 UPTC, 198. This Court held that the goods can not be seized and the penalty can not be levied merely on the ground that the good was not accompanied by declaration form or the form is found to be false unless a case of an attempt to evade the tax is made out. Therefore, for the seizure of the goods and for the levy of penalty, it is the condition precedent to make out a case of attempt to evade the payment of tax. In the case of M/s CST Vs. Oriental Carbon Limited, reported in 1985 UPTC, 613. This Court held that penalty under section 15-A (1) (o) of the Act can not be levied in the absence of attempt to evade the payment of tax. This view has been upheld by the Apex Court in the case of M/s CST Vs. Oriental Carbon Limited, reported in 1997 NTN 105 and in the case of M/s Godfrey Philips India Ltd., Ghaziabad Vs. CST, reported in 1992 UPTC, 902 this Court held that the purpose of issuing of Form-31 is to bring the transaction to the notice of the department so that the same may be considered in the assessment.
In the present case admittedly, good was accompanied by bill and Form-31 and it was voluntarily declared at the check post. In Form-31 complete details of the good was mentioned. These two things overrules the interference of an attempt to evade the tax. Form-31 of M/s Mahajan Tanners Private Limited was wrongly used for the despatch of the goods of the applicant by M/s Universal Leather Deviapuram, Eroda, (Tamilnadu) for which applicant can not be held responsible. In any view of the matter, in the absence of any attempt to evade the transaction and tax, penalty can not be sustained.
In the result, revision is allowed. Order of the Tribunal is set aside and quashed.
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