M/s Kshetriya Punjab Khadi v. State of Punjab & Anr.
Case at a glance
Outcome
Disposed of
The petition is disposed of in the manner indicated above
Provisions considered
Judgment
Ms. Puneeta Sethi, Advocate for the petitioner. Mr.Amol Rattan, Additional Advocate General, Punjab for the respondents. CORAM: Hon’ble Mr.Justice Adarsh Kumar Goel Hon’ble Mr. Justice Rajesh Bindal Rajesh Bindal, J. The petitioner has approached this Court by filing the present petition under Section 22(2)(b) of the Punjab General Sales Tax Act, 1948 (for short, `the Act') seeking a direction to the Sales Tax Tribunal-II, Punjab (for short, `the Tribunal') for referring the following questions of law for opinion of this Court:
(i) Whether in the facts and circumstances of the case levy of penalty and interest under the Act ought to be deleted in view of law laid down by the Hon'ble Supreme Court ? (ii) Whether the penalty and interest should be levied on the petitioner when there is no finding of any contumacious conduct on the part of the applicant in filing the return nor there is any concealment of gross turnover in the return ?
After hearing learned counsel for the petitioner at the time of motion hearing, notice was issued confined to imposition of penalty only.
We have heard learned counsel for the parties on the question of penalty. As the facts of the case are not in dispute, keeping in view the judgment of this Court in S.T.C. No.19 of 1992-- M/s Chaudhary Tractor Company, Tohana v. State of Haryana, decided on 29.5.2006, we treat the question of penalty as having S.T.C. No.5 of 2006 [2] been referred to this Court and proceed to answer the same. It is pleaded that the assessee is a charitable organisation registered under the Societies Registration Act, 1860. It is non-profit making institution established for the development of Khadi and Village Industries with the object of giving employment to the people having its works at different places in Haryana, Punjab, Himachal Pradesh, Delhi and Union Territory Chandigarh. For the assessment year 1999-2000, the assessee filed its return declaring the gross turnover of Rs. 1,34,27,953.54 claiming exemption as per notification issued by the State Government under Section 30 of the Act.
Operative part
It is further pleaded that though on the date of filing of the return, the exemption granted had already expired, but being the past experience, where the State Government had restored the exemption with retrospective effect, the assessee claimed exemption as the matter was pending consideration with the government and was being pursued. While framing assessment, the Assessing Authority, while levying tax, also charged interest for the delayed payment and also levied penalty of Rs. 15,000/- under Section 10(6) and Rs. 2,000/- under Section 13(3) of the Act. In appeal, the assessee failed. It is not in dispute that though the assessee was hopeful that exemption would be restored later on with retrospective effect but was not restored. Accordingly, in terms of the assessment framed, the amount of tax assessed on the basis of the turnover disclosed by the assessee was paid. As far as question of penalty is concerned, the fact that the assessee is a non-profitable organisation and on an earlier occasion, the exemption having been restored with retrospective effect, the fact having not been controverted by the State, we do not find any mens rea in assessee's not depositing the tax along with the return and hold that the penalty, as mentioned above, was not leviable in the facts and circumstances of the present case. Accordingly, we answer the question in favour of the assessee holding that there was no justification for levy of penalty on the assessee. S.T.C. No.5 of 2006 [3] The petition is disposed of in the manner indicated above. ( Rajesh Bindal ) Judge (Adarsh Kumar Goel) Judge
9.10.2006
Questions this judgment answers
What did the Court decide in this case?
The Court recorded the following disposition: The petition is disposed of in the manner indicated above
Which statutory provisions did this judgment involve?
Punjab General Sales Tax Act, 1948 — s. 22(2)(b); Registration Act, 1908.
Which court decided this case, and when?
Punjab & Haryana High Court, on 09 Oct 2006. The bench was RAJESH BINDAL, ADARSH KUMAR GOEL.
Precedent status how later indexed judgments have treated this case
No known negative treatment found in the Courts & Cases corpus.
This is a result about the indexed corpus, not a finding that the judgment remains good law. Coverage may be incomplete.