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M/S Alley Steel Forgins (P)Ltd. v. The Commissioner Sales Tax U.P.Lucknow - SALES/TRADE TAX REVISION No. 1664 of 1993 [2004] RD-AH 445 (4 August 2004)


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M/S Alloy Steel Forgings (P) Ltd. ....Applicant


The Commissioner of Sales Tax ....Opp.party


Hon'ble Rajes Kumar, J.

This revision under Section 11 of U.P. Sales Tax Act  is directed against the order of Tribunal dated 19.08.1993 relating to the assessment year 1985-86, by which Tribunal has confirmed the levy of penalty under section 10-A of Central sales Tax Act (hereinafter referred to as "Act") for Rs.59,440/- . Proceedings under section 10-A of the Act was initiated on the ground that the applicant had purchase iron and steel against Form-C, while iron and steel were used in the manufacturing of forgings and for which the registration certificated under Central Sales Tax Act was not granted. After reply of the notice, order under section 10-A was passed and a sum of Rs.59,440/- was levied towards penalty. First appeal filed by the applicant was rejected. Applicant filed second appeal before the Tribunal, which has also been rejected.

Heard learned counsel for the parties.

Learned counsel for the applicant contended that the applicant was also registered for certain items for use in the manufacture, which is mentioned in the list. He submitted that since last several years, dealer was engaged in manufacturing and used iron and steel purchased against Form-C in the manufacturing and this fact was also in the knowledge of the Trade Tax authorities and they ought to have amended the registration certificate and, therefore, there was no case of penalty under section 10-A of the Act. Learned Standing Counsel supported the order of Tribunal.

I have perused the order of Tribunal and the authorities below.

Tribunal has categorically recorded finding of fact that applicant had purchased iron and steel against Form-C and used in the manufacturing of iron forgings for which the applicant was not authorised. Inspite of query being made learned counsel for the applicant is not able to show that the items, which have been purchased from outside the State of U.P. and in respect of which Form-C was issued are mentioned in the registration certificate. The submission that dealer had purchased iron and steel against Form-C since last several years and used in the manufacturing and department was aware about this fact is wholly irrelevant for the purpose of levy of penalty.

Section 10 (b) of the Central Sales Tax Act provides that If any person being a registered dealer, falsely represents when purchasing any class of goods that goods of such class are covered by his certificate of registration he shall be punishable with simple imprisonment which may extent to six months, or with fine, or with both"

In the present case admittedly, dealer was not registered for the purpose of iron and steel for use in the manufacturing, thus while making the purchases it falsely represented and issued Form-C.  Present is clear case of violation of section 10 (b) of the Act.

Learned counsel for the applicant has referred the decision of this Court in the case of M/s Snow While Industries, Rishikesh Vs. CTT, reported in 1999 UPTC, 130. In that case, dealer was registered for machinery and Form-C was issued for diesel generating set. It was held that diesel generating set is covered under the machinery and therefore, penalty was deleted. In the case of Vegetable Industries Complex, Badaun Vs. CTT, reported in 2002 UPTC, 680 dealer purchased steel plate and tubes against Form-C while in the registration certification iron alongwith spare parts was mentioned. Plea raised by the dealer was accepted that the dealer under the bonafide belief issued Form-C on the ground that registration certificate was granted for spare parts and iron. In the case of Kisan Sahkari Chini Mills Ltd. Vs. CST, reported in 2003 UPTC, 1197. This Court had deleted the penalty on the ground that  dealer was a Government undertaking and there was no finding by the Tribunal that there was any deliberate representation by the dealer while making the purchases. In my view, all the aforesaid cases are not applicable to the present case and are distinguishable. In the present case, admittedly, applicant was not registered for iron and steel, for which Form-C was issued under the Central Sales Tax Act for the use in the manufacturing. Applicant had all along taken the plea that at the time of various surveys, applicant was found manufacturing the goods and the department was aware about the use of imported iron and steel in the manufacturing. In the present case, Tribunal has recorded a categorical finding of fact that the applicant had purchased iron and steel against Form-C by making the false declaration. Finding of Tribunal is finding of fact.

In the circumstances, revision fails and is dismissed.




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