# M/s Bharat Oil Company v. Commissioner of Trade Tax, U.P., Lucknow

- **Citation:** (2004) 2 ILRA 642
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2004-07-09
- **Case number:** Trade Tax Revision No. 858 of 1994
- **Bench:** Prakash Krishna
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-bharat-oil-company-v-commissioner-of-trade-tax-u-p-lucknow-40294
- **Pages:** 4

## Headnote

U.P. Trade Tax Act-S. 15(1) (c)-Levy of
Penalty-Legality-No difference between
tax returned and tax assessment-As
account books of dealer stood acceptedreassessment order set aside.

In the present case there is no difference
in between the tax, tax as returned and
the tax as assessed, as the account
books of the dealer stand accepted and
the reassessment order stands set aside.

In the result I am of the view that no
case for levy of penalty under section 15A (1) (C) of the Act has been made out.

 Para 6
Case law discussed:
1988 UPTC 1104
(1968) 21 STC 104
1986 UPTC 1301
2004 UPTC 217

## Text

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642

5. In the present case, the deposit
which has been made by the tenant was
made under section 30 (2) of the Act and
not under section 30 (1) of the Act. The
tenant had categorically stated in his
application that the landlord had died and
that he did not know as to whom the rent
should now be paid. Thus, the deposit of
rent under section 30 (2) of the Act, was a
valid deposit. The contention of the
learned counsel for the applicant that the
deposit was made under section 30 (1) is
wholly
incorrect.
Consequently,
the
judgment cited by the learned counsel are
distinguishable and are not applicable to
the present case. Since a valid deposit had
been made by the tenant, there were no
arrears of rent on the date when the notice
of demand was served. Consequently, the
tenant was not in arrears of rent of more
than four months under section 20(4) of
the Act and could not be evicted from the
premises in question.

6. In view of the aforesaid, I find no
reason to interfere in the judgment passed
by the Court below. There is no merit in
the present revision and is dismissed. In
the circumstances of the case there shall
be no order as to cost.
---------
REVISIONAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 9.7.2004

BEFORE
THE HON'BLE PRAKASH KRISHNA, J.

Trade Tax Revision No. 858 of 1994

M/s Bharat Oil Company
...Applicant
Versus
Commissioner
of
Trade
Tax,
U.P.,
Lucknow

 ...Respondent

Counsel for the Applicant:
Sri R.R. Agrawal

Counsel for the Respondent:
S.C.

U.P. Trade Tax Act-S. 15(1) (c)-Levy of
Penalty-Legality-No difference between
tax returned and tax assessment-As
account books of dealer stood acceptedreassessment order set aside.

In the present case there is no difference
in between the tax, tax as returned and
the tax as assessed, as the account
books of the dealer stand accepted and
the reassessment order stands set aside.

In the result I am of the view that no
case for levy of penalty under section 15A (1) (C) of the Act has been made out.

 Para 6
Case law discussed:
1988 UPTC 1104
(1968) 21 STC 104
1986 UPTC 1301
2004 UPTC 217

(Delivered by Hon'ble Prakash Krishna, J.)

1. The present revision arises out of
penalty proceedings under section 15-A
(1) (C) of the U.P. Trade Tax Act for the
assessment
year
1968-1969.
The
applicant, a partnership firm, disclosed its
total sales of imported kerosene oil at
Rs.1,67,155-50. The account book,
during the assessment proceeding was
accepted by the assessing authority. After
the completion of assessment order some
information
was
received
by
the
Department to the effect that the applicant
has imported kerosene oil amounting to
Rs.7,06,921/-
from
Indian
Oil
Corporation in the aforesaid assessment
year.
The
department
initiated
reassessment proceeding, in order to
assess the escaped turnover, under
section 21 of U.P. Sales Tax Act. The
reassessment proceeding was contested
by the applicant. However, reassessment
order creating additional demand was
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2 All] M/s Bharat Oil Company V. Commissioner of Trade Tax U.P., Lucknow
643
passed by the Assessing Authority. The
reassessment
order
was
successfully
challenged
before
the
Appellate
Authority. The Appellate Authority set
aside the reassessment order on a short
ground that the reassessment notice was
not validly served on the dealer and as
such very initirction of reassessment
proceeding was without jurisdiction. The
reassessment notice was served on one
Krishna Bhagwan, who was the agent of
the assessee firm. But the firm stood
dissolved w.e.f. 7th of November 1971
and the notice was served on Shri Krishna
Bhagwan on 29th March 1973 i.e. after
the dissolution of the firm. This was held
to be invalid service and consequently the
proceeding under section 21 was dropped
by the First Appellate Authority. This
order was confirmed by the tribunal as
well as by the High Court in Sales Tax
Revision No.309 of 1987. The judgment
of the High Court is dated 21st of July
1988 and is also reported in 1988
U.P.T.C. 1104, C.S.T. vs. S/S. Bharat Oil
Company. Undaunted by the failure in the
reassessment proceeding, the department
thereafter in the month of April 1989
levied penalty under section 15 (A)(I)(C)
of the Act by the order dated 19th April
1989, to the tune of Rs.94,500/-. The
assessing Officer rejected the contention
of the dealer that no penalty could be
levied as the reassessment order passed
under Section 21 of the Act has been
finally set aside. He concluded that on the
basis of the information it is established
that the dealer has imported Kerosene
worth Rs.7,06,921/-. This order was
confirmed by the Appellate Authority.
The tribunal has substantially confirmed
the penalty order except that it has
reduced the quantum of penalty to
Rs.76,900/-.

2. Challenging the aforesaid penalty
order the present revision has been filed.

3. Heard the leaned counsel for the
parties and perused the record. The
learned counsel for the applicant has
submitted
that
the
department
has
accepted the account books of the dealer
applicant in the assessment proceeding
and that the reassessment order has been
set aside, resultantly only the assessment
order accepting the account books of the
applicant is in operation. Therefore, the
levy of penalty on the ground that the
dealer has concealed the particulars of his
turn over or has deliberately furnished
inaccurate particulars of such turn over
does not arise. In contra, the learned
standing counsel has submitted that
notwithstanding the fall of reassessment
order framed under section 21, the fact
remains that the dealer has imported
kerosene oil worth Rs.7,06,921/- and
therefore the department has rightly
levied the penalty.

4. Section 15-A of the U.P. Sales
Tax Act provides the levy of penalties in
certain cases. Indisputably the penalty
proceeding
was
initiated
by
the
Department after setting aside of the
reassessment order. Before the tribunal a
controversy was raised by the applicant
that under unamended clause C of Section
15-A (1) no penalty could be imposed for
concealment of the turnover or deliberate
furnishing of inaccurate particulars of
such turn over. However, no such
argument was raised before me. The
learned
counsel
for
the
applicant
proceeded with the assumption that the
amended clause (C) of Section 15-A
would be attracted if at all there is
concealment of particulars of the turn
over or deliberate furnishing of inaccurate
particulars of such turn over.

5. Clause (C) of Section 15-A makes
a provision for levy of penalty in the case
of deliberate furnishing of inaccurate
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 INDIAN LAW REPORTS ALLAHABAD SERIES [2004
644
particulars of turn over or of concealment
of turn over. The burden to establish
necessary ingredients of concealment and
deliberate
furnishing
of
inaccurate
particulars is on the department. The
Supreme court in the case of Narain Das
Suraj Bhan vs. C.S.T. (1968) 21 S.T.C.
104 has held that the concealment of
furnishing inaccurate particulars must be
in the return furnished under section 7 of
the Act. In that case the Supreme Court
was examining a question as to whether a
penalty for inaccurate particulars of such
turn over (under unamended clause (B),
which is now equivalent to amended
clause (C) will refer to return filed under
section 7 or section 21 of the Act. It was
held that even if in response to a notice
issued under section 21 (1), the assessee
files a fresh statement of its turnover it is
still liable to be penalized under section
15-A for concealment or deliberate
furnishing of inaccurate particulars of turn
over in return filed under section 7. In the
present case the fact remains that the
disclosed turnover has been accepted by
the
Department
in
the
assessment
proceedings. The said assessment order
accepting the account books of the dealer
is still intact and the reassessment order
has been set aside. Before any penalty
can be levied the turn over has to be
assessed as concealed turnover in the
assessment
order
of
an
assessee.
Therefore, in penalty proceedings, the
Assessing authority has to probe into and
decide whether there has been any
concealment of turn over. The said
finding
could
be
recorded
in
the
assessment
proceedings
only
which
includes reassessment also. But it does
not include the penalty proceeding itself.
The turnover has to be assessed in the
assessment order otherwise the passing of
the assessment order would become
meaningless. If for one reason or the other
the disclosed turn over has been accepted
in the assessment proceeding including
reassessment, I am of the opinion that
there is no question of concealment of
turnover or of furnishing inaccurate
particulars of such turn over. The veracity
of the return filed by the dealer having
been accepted by the Department in
assessment proceeding, the department
cannot turn around and say in the penalty
proceeding that the return filed by the
dealer under section 7 of the Act is
inaccurate as it has concealed the turnover
or
deliberately
furnished
inaccurate
particulars of such turn over. Section 7 (2)
of the U.P. Sales Tax Act says that the
Assessing Authority, after such inquiry as
he considers necessary, if he is satisfied
with any returns submitted under sub
section (1) are correct and complete, he
shall assess the tax on the basis thereof. It
follows that the returns filed by the dealer
applicant under sub section (1) were
accepted as correct and complete, as its
account books were accepted. The word
"assessment" is comprehensive word and
can denote the entirety of proceedings
which are taken with regard to it. The
assessment proceedings are quasi judicial
proceedings in nature and a quasi judicial
order can be set aside or modified in
accordance with the prescribed procedure.
The Assessing authority, in penalty
proceedings
can
not
discard
the
assessment order and come to the
conclusion that the return submitted by
the dealer was either incorrect or
incomplete. To put it differently, in
penalty
proceedings
the
authority
concerned is bound to give due regard to
the assessment order, accepting the
account books.

6. There is another aspect of the
matter. Section 15-A (1) (C) is the
substantive provision and it defines
various omissions and commissions for
the purposes of levy of penalty, under
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clause (a) to (r). Thereafter, sub clause (II)
of clause (r) has made a provision for
determination of quantum of penalty in
case referred to any clauses (C), ..........
It provides that the quantum of penalty
would be, a sum not less than 50% but not
exceeding 200% of the amount of the
amount of tax which would thereby have
been avoided. This Court in the case of
Satya Pal Singh Brick Field Vs.
Commissioner
of
Sales
Tax
1986
U.P.T.C. 1301, in para 17 has held that in
cases of concealment of turn over the
liability to pay the tax on a dealer would
be the difference between the tax, tax as
returned and the tax as assessed. In the
present case there is no difference in
between the tax, tax as returned and the
tax as assessed, as the account books of
the dealer stand accepted and the
reassessment order stands set aside.

7. In the result I am of the view that
no case for levy of penalty under section
15-A (1) (C) of the Act has been made
out. Reference was also made to a
judgment in the case of P.Anand and
Sons Vs. C.S.T. 2004 U.P.T.C. 217. It
has been held in that case that once the
notice under section 21 of the Act is
quashed, penalty under Section 15-A (1)
(C) of the Act cannot be sustained.

8. For the reasons given above the
revision is allowed and the penalty order
as well as penalty proceedings under
section 15-A (1) (C) of the Act is set aside
with costs.
---------
ORIGINAL JURISDICTION
CRIMINAL SIDE
DATED: ALLAHABAD 12.07.2004

BEFORE
THE HON'BLE M. KATJU, J.
THE HON'BLE R.S. TRIPATHI, J.

Criminal Contempt No. 13 of 2004

Criminal Contempt of the High Court of
Judicature
at
Allahabad
on
the
Application of District Judge, Ghaziabad

...Petitioner
Versus
Subhas Tyagi, President of District Bar
Association, Ghaziabad ...Respondents

Counsel for the Petitioner:

Counsel for the Respondents:
Sri C.L. Pandey

Contempt
of
Courts
Act
1972Jurisdiction to punish for contemptDiscretionary-In view of apologies and
undertaking by contemnors proceedings
for contempt Dropped- Contemnors the
office bearers of District Bar Association
Ghaziabad-Call for strike despite of
supreme
court
direction-held
highly
objectionable-Considering
their
undertakings and unconditional apologycontempt
proceeding
dropped
with
strong warning.

We have in several earlier decisions
observed that if district court lawyers go
on strike then the Judges must sit in
Court and decide the cases even in the
absence of lawyers, and if Advocates
disturb the Court then the District Judge
must call the police to prevent them
from doing so. No one will be allowed to
hold the judiciary at ransom.
 Para 6

However, since contempt jurisdiction is
discretionary
jurisdiction
hence
this
Court is not bound to take action as this
is the discretion of the Court. On the
facts and circumstances of case while we