M/S.United Electricals And Engineering PVT.LTD. vs. State Of Orissa
Held
The Court held that the Assessing Officer must be satisfied that the escapement of tax was without reasonable cause before imposing penalty under Section 43(2). The assessment order lacked this crucial satisfaction.
Facts
The Assessing Officer imposed a penalty under Section 43(2) of the OVAT Act for erroneous claim of Input Tax Credit (ITC). The assessee contended that the penalty was levied without a finding that the ITC was availed without reasonable cause.
Key Issues
Whether penalty under Section 43(2) of OVAT Act can be imposed without a finding of 'without reasonable cause' for tax escapement?
Sections Cited
Section 43(2)
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORDER 07.12.2022
1. While admitting the present revision petition of the Petitioner- Assessee against the impugned order dated 7th October, 2015 of the Odisha Sales Tax Tribunal (Tribunal) dismissing S.A. No.353 (VAT) of 2013-14 filed by the Assessee, this Court framed the following questions for consideration vide order dated 31st August, 2016:
“I. Whether, the Division Bench-II, Odisha Sales Tax, Tribunal is right in law in holding the imposition of penalty equal to two times of tax assessed under Section 43-(2) of the OVAT Act in absence of observation by the Assessing authority that the underassessment tax is without any reasonable cause?
II. Whether, the facts and circumstances of the case, the Division Bench-II, Odisha Sales Tax Tribunal, Cuttack, is right in
The judgment continues below.
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Reproduced from the public record of the Orissa High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.