Dismissed

M/S.Ashirbad Agro Pr v. Sales Tax Officer

Orissa HC23 Nov 2021WP(C)/21699/2012

Case brief

AI extract

What is this about?

This writ petition challenged a penalty order under Section 43(2) of the Odisha Value Added Tax Act, 2004. The Court held that since the assessment was completed on the original return and the revised return was not accepted, the 'tax additionally assessed' existed, making the penalty leviable despite the tax paid matching the assessed amount.

What did the court decide?

The writ petition was dismissed; the interim order staying the penalty was vacated.

M/S.Ashirbad Agro Pr Vs Sales Tax Officer — Income Tax | Orissa HC (2021)

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IN THE HIGH COURT OF ORISSA AT CUTTACK

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W.P.(C) No.21699 of 2012

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M/s. Ashirbad Agro Products Pvt. …. Petitioner Ltd.

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Mr. T. K. Satpathy, Advocate

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-versus-

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…. Sales Tax Officer, Jajpur Circle, Opposite Party Jajpur

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Mr. Sunil Mishra, Additional Standing Counsel

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CORAM: THE CHIEF JUSTICE JUSTICE A. K. MOHAPATRA

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ORDER 23.11.2021

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Order No.

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1. The challenge in the present petition is to an assessment order dated 31^st August, 2012 passed by the Sales Tax Officer (STO), Jajpur Circle, Jajpur Road directing that the Petitioner has to pay Rs.8,28,703.70 or Rs.8,28,704/- as penalty.

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The facts in brief are that for the period 1^st April, 2009 to 30^th June, 2010, the Petitioner/dealer filed a return. In the meanwhile, The STO Vigilance, Cuttack Division inspected the dealer’s business premises on 22^nd June, 2010 and submitted a report, which inter alia revealed that the dealer had availed Input Tax Credit

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(ITC) on construction materials, out of which one portion was pertaining to purchase from unregistered dealers within Odisha.

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It appears that after the investigation unit submitted the fraud case report, the dealer filed a revised returns and also paid a tax in the sum of Rs.4,14,351.85. However, the Department declined to accept the revised return and completed the assessment on the original return determining the tax payable as Rs.4,14,351.85.

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By the impugned assessment order while calculating the above tax amount, the STO also calculated the penalty under Section 43(2) of the Odisha Value Added Tax Act, 2004 (OVAT Act) as Rs.8,28,703.70 being twice the amount of tax. After noting that the dealer has already paid the tax amount, he was directed to pay the penalty amount.

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While issuing notice in the present petition on 29^th January, 2013, this Court stayed the realization of the penalty amount.

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This Court heard the submission of learned counsel for the parties. The contention of Mr. Satpathy, learned counsel appearing for the Petitioner is that since the tax paid and the tax assessed is the same amount, it should be taken that this is a zero tax situation and, therefore, no penalty is leviable. He added that the assessment had been completed on the revised return filed by the Petitioner, which

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had been accepted by the Department and, therefore, they were estopped from levying penalty.

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Mr. Mishra, learned Additional Standing Counsel appearing for the Department, on the other hand, pointed out that the revised return was filed beyond the time stipulated under Section 33 (4) of the OVAT Act and that in terms of Section 43(2) thereof, the dealer was liable to pay penalty on the tax that was ‘assessed’ i.e. Rs.4,14,351.85.

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The above submissions have been considered. Indeed, the language used under Section 43(2) of the OVAT Act is that the penalty would be a sum equal to twice “the amount of tax additionally assessed under this section.” In the present case, the assessment was completed on the original return filed by the Assessee and not on the revised return as submitted by learned counsel for the Assessee. This is evident from the impugned order where it is observed that “the dealer also filed revised return after submission of fraud case report which is not at all accepted.”

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In that view of the matter, although the Petitioner may have filed a revised return after the fraud case report was submitted, and paid the tax amount of Rs.4,14,351.85, the dealer cannot possibly avoid the consequences of the penalty under Section 43 (2) of the OVAT Act.

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Consequently, the Court finds no error having been committed by the STO in passing the impugned order. The writ petition is accordingly dismissed.

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The interim order passed earlier stands vacated.

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Issue an urgent certified copy of this order as per rules.

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M. Panda

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(Dr. S. Muralidhar)
Chief Justice
(A. K. Mohapatra )
Judge

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M/S.Ashirbad Agro Pr v. Sales Tax Officer

Case brief

What is this about?

What did the court decide?

M/S.Ashirbad Agro Pr v. Sales Tax Officer

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

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