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Sunday 11 September 2011

Re-opening of Assessment


Medical ground has been held sufficient cause for reopening the assessment u/s 34 of the Rajasthan Value Added Tax Act, 2003.  It has been consistently held by courts that illness of the counsel is sufficient reason for not complying with the notice issued kindly refer to the following judgments: 

1983 RRD 120 Kailash Bros. Vs. CTO

22 Tax Update 150 M/s Hari Oil Mill, Dosa Vs. ACTO, Anti Evasion-II, Jaipur 
 15 Tax Update 231 M/s Kailash Chand Garg, Bayana Vs. CTO, Works & Leasing Tax, 
Alwar 
TRADE TAX REVISION NO.(54) OF 2004 Chandra Bhan Tewari ....Applicant  
Versus Commissioner of Trade Tax, U.P., Lucknow.

CST Vs. M/s Agrimal Raja Ram, Muzaffarnagar, reported in 1973 UPTC, 415

Chandrawali Enterprises vs. Commissioner, Trade Tax 2007 NTN (Vol. 34) 62Ex-parte order - Application for reopening - Rejection thereof - Sufficient cause for non-appearance - U.P.Trade Tax Act, 1948 Section 30 - Ex-parte penalty order was not re-opened on the ground that if female Proprietor of the concern was ill, the Counsel should have appeared before the Assessing Authority - Dealer has claimed that due to illness of proprietor nobody could appear before the Assessing Authority and no Counsel was engaged for this case at that stage - Whether illness of proprietor is sufficient ground for non-appearance on the date of hearing warranting re-opening of the case ? 

Held- Yes - There is no reason for not accepting the Medical Certificate - Opportunity for hearing should be allowed to the dealer - Decision in Ganesh Int Udyog vs. CST 2004 35 STJ-64 and other decisions followed.

Service of Notice


CTO, Tonk Vs. Shri Mahaveer Trading Co., Bambor Distt. Tonk (RTB) 7 Tax update 15.  Rajasthan Sales Tax Act, 1994, section 30- Whether the issue and service of the notice under section 12 of the Old Act was mandatory to acquire jurisdiction? RTB held that under section 12 of the Old Act, the issue and service of the notice was, therefore, not only mandatory to acquire jurisdiction, but also a condition precedent to the validity of the order of reassessment.

Jaipur Metal & Electricals ltd. Vs. Union of India, (1989) 6 RTJS 4 (Raj.) Penalty- Notice-Notice is necessary before imposition of penalty-Penalty set aside & case remanded. R.54 - Held, that no notice was given to the petitioner before imposing the penalty which is a necessary requirement under Rule-54 of the read with Section 9 of the Central Sales Tax Act. However it is made clear that if the Department chooses to do so it will be free to take fresh proceedings for imposing penalty on the assessee after giving proper notice as required under the law.

ACTO, Ward-III, Ratangarh, (Churu) Vs. Yogiraj & Company (RTB) Tax Up-Date Vol. 19 Part 5 Page 234  Notice - Rajasthan Sales Tax Act, 1994 sections 30 and 37- While remanding the cases to the Assessing Authority, the Rajasthan Tax Board held that:- “From the file it appears that though notices have been issued but served to only one person, What is relation of the dealer with this person, it is not known. In addition to it, orders have been passed under two different sections i.e. 30 and 37 which is not proper.

Decision -Penalty U/s 76(6) the Rajasthan VAT Act, 2003


CTO Vs. Bansal Scrap Traders, Bikaner  (2002) 13 STT 235 (RTB) Held - That before levying penalty AA have not made any proper inquiry. DC(Appeal) has rightly mentioned that AA has not proved why documents were doubtful. All documents were true. Hence, appeal is liable t be rejected. 

In Re M/s Mahaveer Conductors Vs. ACTO (1994) 15 RTJS 107 R-HC it was held that the section 78 does not provide any presumption about existence of mens rea against the defaulter, the burden of proving mens rea is on the department.

M/s Jitendra & Company Vs. State of Rajasthan (1998) 1 Sales Tax Today  101 – It was held that penalty under section 78 (5) is not automatic, but is discretionary and where there is no mens rea of evading tax penalty cannot be imposed without considering the mitigating facts . 

ACTO Vs Katta Oil Mills (1996) 19 TW 1 (RTT):
At the time of checking truck driver could not produce the documents in respect of tanker containing mustard oil. Suspecting evasion ACTO seized the goods. The dealer appeared and produced the documents. ACTO rejected the documents and imposed penalty. Tribunal held that Assessing Authority has not given single reason to how documents are not reliable. He has made no inquiry worth the name regarding the documents. Penalty quashed.
           
ACTO Vs. M/s Abhay Rajiv Kumar, Alwar (2002) 11 STT 297 (RTB)
Held – Penalty imposed was not in accordance with law. No mens rea was proved. Appeal failed.
(2000) 120 STC 212 (Raj) ,
State of Rajasthan Vs. DP Metals 124 STC 611(S.C.)
Hindustan Steels Ltd. Vs. State of Orissa (1970) 25 STC 211 (S.C.) 
ACTO Vs. Kumawat Udhoy (1995) 97 STC 238 (Raj.)
CTO Vs. Birdhichand Bansidhar (1994) 93 STC 346) (Raj.)
CTO Vs. Rajdhani Wines (1992) 87 STC 362 (Raj.)


Bharat Petroleum Ltd. Vs. Assistant Commercial Taxes officer, Udaipur  (1999) 3 Sales Tax Today 7 – Though it is correct to say that provision of section 78 are mandatory and directory yet where during the inquiry the dealer head furnished declaration in Form No. 18 A along with the reply to show cause notice.  Mens rea should have been try to be established and this was not done in this matter.  Penalty was set aside. 

Chandak and Company Vs. Assistant Commercial Taxes officer (Tax Board) (1998) TW 833, 1998 STN SA-90. – Documents correct, no mens rea proved, 18 A produced on next day- no penalty is to be levied. 

In Re  (1994) 15 RTJS 107 M/s Mahaveer Conductors Vs. ACTO R-HC it was held that the section 78 does not provide any presumption about existence of mens rea against the defaulter, the burden of proving mens rea is on the department.

Steel Authority of India ltd. Vs. ACTO, Jaipur (1999) 3 sales Tax Today 54 - held though Form ST 18-A is mandatory yet before imposition of penalty mens rea of evasion of tax has to be proved.

It was held in Re:  CTO, Bharatpur Vs. Hind Timber Sri Ganganagar (1999) 4 Sales Tax Today 59 (RTB) that the department could not establish mens rea of evasion of tax and without proving mens rea the penalty could not be imposed only on the ground of the absence of Form 18A.

M/s Jitendra & Company Vs. State of Rajasthan (1998) 1 Sales Tax Today  101 – It was held that penalty under section 78 (5) is not automatic, but is discretionary and where there is no mens rea of evading tax penalty cannot be imposed without considering the mitigating facts . 

16 RTJS 127 Assistant Commercial Taxes officer Vs. Yashwant & Co.

6 RTJS 61 Bundi Transport – Negligence of the transporter to carry the documents.

(1999) 3 Sales Tax Today 14 Surya Roadways, Ahmedabad Vs Assistant Commercial Taxes officer Ajmer:
Goods were being transported from Delhi to Ahmedabad. The vehicle was intercepted in Rajasthan and checked. On inquiry it appeared that the consignor firm at Delhi was bogus. Assistant Commercial Taxes officer presumed that goods were being consigned from Rajasthan & to avoid tax. The consignment was being shown in the name of a firm of Delhi, so he imposed penalty U/S 78(5)-whether only on the ground that the firm at Delhi was bogus. It could not be presumed that goods were being consigned from Rajasthan. Held-No. Before imposing penalty U/S 78(5) it was necessary to prove that goods were actually being consigned from Rajasthan.

(1999) 2 Sales Tax Today 68   M/s Singhal Carriers Co. Vs. Assistant Commercial Taxes officer: Goods in transit were intercepted and checked. A penalty u/s 78(5) was imposed. There was nothing on record to rebut the proposition that the goods in question were in transit from one State to another through Rajasthan – Whether in the facts and circumstances Assistant Commercial Taxes officer had any jurisdiction to impose penalty u/s 78(5) – held - No.
 Ratio in (1998) 108 STC 490 (RTT) was followed.

(1999) 4 Sales Tax Today 220 M/s Mahendra & Co. Vs. Assistant Commercial Taxes officer, Anti Evasion Sirohi (RTB):
Section 22A(7), RST Act, 1954 – Goods accompanied by all other documents except Form ST-18A. Revenue could not prove mens rea – whether penalty could be imposed. Held – No.

Sundram Roadways, New Delhi Vs. State of Rajasthan & others (1998) Sales Tax Today 88:
Transporter carrying goods from Ghaziabad to Mumbai – whether imposition of penalty u/s 22A(7) was proper – held – No – when goods emanating from out side Rajasthan and dispatched to another point outside Rajasthan.  Transit through the States territory Section 22 A RST Act does not come into play and all that the sales tax authorities of Rajasthan can do is to ensure that they in fact do leave the State.

Assistant Commercial Taxes officer, Chittorgarh Vs. Hira Lal, Udaipur (1998) Sales Tax Today 27:
Goods in transit not accompanied by declaration Form ST18A. Declaration Form produced on the same day – whether the declaration is ante dated? Held-No. Whether intention is to evade tax? Held-No, penalty cannot be imposed.

A.C.T.O. Hanumangarh Vs. M/s Ganesh Electrical, Sri Ganganagar & A.C.T.O. Hanumangarh Vs. National Electronics, Sri Ganganagar:
Goods in transit accompanied by all documents except declaration in Form 18A – Notice to furnish the declaration given – declaration submitted before expiry of the period specified in the notice – whether the declaration can be said to be an after thoughts? Held – No, penalty cannot be imposed u/s 22A(7)

(1995) 18 TBR 214 Assistant Commercial Taxes officer Vs. Shree Balaji Driver-RTB:
Production of Form ST 18A before Deputy Commissioner before decision on Appeal is sufficient compliance, penalty set aside.

(1996) 19 TW 1 ACTO Vs Katta Oil Mills (RTT):
At the time of checking truck driver could not produce the documents in respect of tanker containing mustard oil. Suspecting evasion ACTO seized the goods. The dealer appeared and produced the documents. ACTO rejected the documents and imposed penalty. Tribunal held that Assessing Authority has not given single reason to how documents are not reliable. He has made no inquiry worth the name regarding the documents. Penalty quashed.

(1994) 15 RTJS 327 ACTO Vs. Rathi Steel Traders:
So far as issuance of notice for imposition of penalty u/s 78(5) is concerned, when the identity of the owner of goods is established, the notice of opportunity of hearing is ought to be given to the owner.

(1997) TW 591 ACTO Vs. Mohan Chand Mittal (RTB):
Penalty u/s 22A(7) could not be imposed simply for suspicion of tax evasion due to deviation of route.

(1999) 3 Sales Tax Today 26 M/s Voltas ltd. Vs. ACTO:
Though the honorable tribunal had held that declaration Form ST-18A is mandatory all the same it has also been held that before imposing penalty u/s 78 the mens rea of evading tax has also to be proved.

(1999) 3 Sales Tax Today 35 ACTO Vs. M/s Kisan Trading Co.:
The imposition of penalty u/s 22A(7) only on ground of non-availability of declaration is not proper.

(1999) 22 TW 108 Indian Oil Corporation Vs. ACTO (RTB):
Non furnishing of declaration form ST-18A at the check post in a case of transfer of goods from one branch to another, on the ground it remained with the transporter by an oversight does not attract penalty u/s 22A(7) of the old Act.



Rectification of Mistake RST/VAT Act


29 Tax Up – Date 253 ACTO Vs. M/s. Makkad Plastic Agencies

 Rajasthan Sales Tax Act,1994, section 37- Rectification of mistake –while allowing the appeal of the revenue, the supreme court held that:-

The scope and ambit of the power which could be exercised under section 37 of the act of 1994 is circumscribed and restricted within the ambit of the power vested by the said section. Such a power is neither a power of review nor is akin to the power of revision but is only a power to rectify a mistake apparent on the face of the record. Rectification implies the correction of an error or a removal of defects or imperfections. It implies an error, mistake or defect which after rectification is made right.

When the subsequent order dated 22.01.2009 passed by the taxation board is analysed  and scrutinized it would be clear/apparent that the Taxation Board while passing that order exceeded its jurisdiction by re-appreciating the evidence on record and holding that there was no mala fide intention on the part of assessee-respondent for tax evasion. Such re-appreciation of the evidence to come to a contrary finding was not available under section 37 of the Act of 1994 while exercising the power of rectification of error apparent on the face of the records.

The order passed by the Taxation Board on 22.01.2009 as also the impugned order and judgment passed by the High Court upholding the said holder of the Taxation Board are hereby set aside and quashed and the original order passed by the Assessing Officer is restored.



M/s Shakti Iron Trading Co. Vs. Assistant Commercial Taxes officer, Circle III-Anti Evasion  (1999) 4 Sales Tax Today 146 (RTB):
An application u/s  37 was filed. No mistake of law or facts apparent on the face of record was mentioned in the application. Instead the application was, in effect, for reconsideration of the decision – whether a decision could be reviewd u/s 37 – Held -  u/s 37 of RST Act, 1994 a mistake of law or facts apparent on the face of the record can be rectified and under the cover of rectification a well considered decision cannot be reviewd. Appeal rejected.

7 RTJS 366:
RST Act, Sec. 17 – Rectification scope limited – only mistake apparent from record, which can be detected , without deep probe or detailed arguments, rectifiable, but the mistake of judgement or mistake in application of law cannot be rectified.

Friday 2 September 2011

VAT-47

Notification No. F.12(84)FD/Tax/2009-21 dated 8-7-2009 S.No. 2512
38 goods notified
FINANCE DEPARTMENT (TAX DIVISION)

NOTIFICATION Jaipur, July 8, 2009

S.O.106.- In pursuance of clause (i) and (iii) of sub-rule (1) of rule 53 of the

Rajasthan Value Added Tax Rules, 2006 read with sub-section (1) of section 79 of

the Rajasthan Value Added Tax Act, 2003 (Act No. 4 of 2003), and in supersession

of all the notifications issued in this behalf, the State Government being of the

opinion that it is expedient in the public interest so to do, hereby notifies the

following goods for the purposes of said clauses, namely:-

1. All kinds of furniture including moulded furniture.

2. All kinds of lubricants.

3. All kinds of mattresses, cushion, pillows, all types of sheets, and other articles

made from foam rubber or plastic foam or other synthetic foam and

rubberised coir mattresses.

4. All kinds of toilet & washing soap and detergents.

5. All goods made of cement.

6. All types of bearings.

7. All types of sanitary goods including sanitary pipes and fittings.

8. All types of electrical goods including UPS and CVTS.



9. Audio and Video cassettes

10. Butter & Deshi Ghee.

11. Computers, its softwares, floppies and parts.

12. Cooling equipments including air conditioners and refrigerators.

13. Copper in all its forms including wires.

14. Dry fruits including Clove, Cardamom, Pepper and betel nut.

15. Raw or refined edible oil and Hydrogenated vegetable oil.

16. Electronic items including TV, VCR, VCP.

17. Gur.

18. Iron & Steel as defined under Section 14 of the CST Act.

19. Parts of Automobile & Tractor except when used in manufacturing of

automobiles or tractors.

20. Pan massala, Gutkha and Churi.

21. Paints, varnishes, colour and dyes.

22. Timber, ply woods, Nuwood and Laminated sheets.

23. Safety Matches.

24. Tele-communication and sound transmitting equipments including Cellular &

Cordless telephone, Fax and Pagers.

25. Tea.

26. All types of yarn, whether cotton, woollen or synthetic.

27. Metallic Utensils.

28. All types of crockery.

29. Photographic goods.

30. Plastic goods, PVC granules except when used as raw material for production

of plastic goods.

31. Rubber and goods made of rubber.

32. All kinds of paper and paper products including exercise books.

33. All kinds of tiles.

34. Fireworks.

35. Non edible oil.

36. Rice.

37. Cotton Seed.

38. All kinds of foot-wear.

[No.F.12(84)FD/Tax/2009-21]

By Order of the Governor,

S.S. Rajawat,

Deputy Secretary to Government.