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Virendra Prasad v. State Of U.P. & Others - SALES/TRADE TAX REVISION No. 1439 of 2003  RD-AH 539 (24 February 2005)
TRADE TAX REVISION NO.1439 OF 2003
Virendra Prasad. ....Applicant
State of U.P. and others. ....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 30.10.2003 for the assessment year 1999-2000.
On 23.11.1991, applicant was found transporting 132 bota sagaun and 12 bota shisham wood in vehicle no.UMZ-9438 from Mahrajganj to Varanasi. Vehicle was intercepted by Trade Tax authorities. Alongwith the goods bill, builty and challan were not found and one transit pass no.249 issued by forest department in the name of the applicant was found. Goods were seized and subsequently, released on furnishing of security at Rs.52,000/- in cash being 40% of the value of the goods, which was estimated at Rs.1,30,000/-. In pursuance of the seizure of the goods, notice under section 13-A (3) of the Act was issued for the levy of penalty under section 13-A (4) of the Act. Applicant filed reply, which was not accepted and penalty of Rs.52,000/- was levied under section 13-A (4) of the Act. First appeal filed by the applicant was allowed and the penalty was quashed. Commissioner of Trade Tax filed second appeal before the Tribunal, which was allowed. Order of the first appellate authority was set aside and the order of the assessing authority was restored.
Heard learned counsel for the parties.
Learned counsel for the applicant submitted that the Tribunal has erred in setting aside the order of the first appellate authority. He submitted that in fact good belonged to Smt. Indrawati, wife of Shri Krishna Narayan, Ward No.3, Shiv Nagar, Maharajganj and the applicant was carrying on the goods to Varanasi for sale, which was subsequently, sold to M/s Alok Timber Merchant. He submitted that the goods belonged to the farmers and was not liable to tax in the hand of the applicant. He further submitted that under the Notification No.ST-II-6071/X-6(73)-76 U.P. Act 15/48-Order-83, dated 30.09.1983 was liable to tax at the point of sale by the forest department or by the manufacturer or importer and, therefore, good was not liable to tax in the hand of the applicant. Learned Standing Counsel submitted that at the time of inspection only forest department ramanna was found, which was in the name of the applicant and bill, builty and challan were not found. He submitted that in the statement recorded before the authority, it was stated that the goods were purchased from Maharajganj and was sold to the party of Varanasi. Applicant was not registered under U.P. Trade Tax Act and in as much as entry of the good was not found in the books of account, document or register. Therefore, the provisions of section 13-A (4) of the Act was applicable and the applicant was rightly subjected to penalty.
I have perused the order of Tribunal and the authorities below.
Admittedly, at the time of inspection of the goods, bill, builty and challan were not found. Forest department ramanna was issued in the name of the applicant. Applicant admitted before the authorities below that the goods were purchased from Smt.Indrawati, wife of Shri Krishna Narayan, Ward No.3, Shiv Nagar, Maharanganj and was being transported for sale to Varanasi. This shows that the goods belong to the applicant and was meant for sale but the applicant was neither registered under U.P. Trade Tax Act nor maintained any books of account relating to such transactions. Therefore, good was not traceable to bonafide dealer and the entry of the good was not found in the books of account, documents or register. In the circumstances, applicant has rightly been subjected to penalty under section 13-A (4) of the Act. View of the first appellate authority that the applicant is a farmer and, therefore, was not a dealer within the definition of section 2 (c) of the Act and was not liable to penalty is not correct. Applicant is not a farmer. He has purchased wood from Smt.Indrawati and was found transporting the goods for sale to Varanasi, therefore, applicant was dealer involved in carrying on the business of wood. Therefore, penalty levied under section 13-A (4) of the Act is justified. However, on the facts and circumstances of the case, in my opinion, levy of penalty at 40% is unreasonable and excessive. It is reduced to 20% of the value of the goods, which comes to Rs.26,000/-.
In the result, revision is allowed in part. Order of Tribunal is modified and the amount of penalty is reduced to Rs.26,000/-.
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