Bihar VAT Act | Penalty Imposable U/S 56(4)(B) On Account Of Clerical Mistake In Mentioning Of Invoice Number In Suvidha Form: Patna High Court

The above ruling came in a case filed by the petitioner, M/s Ceat Ltd. engaged in the manufacture and sale of tyres, tubes and flaps who was concerned with a penalty order passed under Section 60(4) (b) read with Section 56(4) (b) of the Bihar Value Added Tax Act, 2005 after detention of a truck carrying goods at the integrated check post, Dhobi, Gaya.

The petitioner had a mother Warehouse situated at Patna and other branch Warehouses in the nearby State, one of which is situated at Ranchi in the State of Jharkhand.

The contention was that by the invoice produced stock transfer was made to the Warehouse at Ranchi and while the same was being transported in a vehicle as per the lorry receipt produced at, the same was detained and checked at the integrated check-post.

The driver of the truck produced the receipt (Annexure-1, 1/A) and SUVIDHA Outgoing Form (Annexure-2) which had to be uploaded before the transport originated and the same was produced on probable checking. The SUVIDHA Form Annexure-2 had a different invoice number from that shown in Annexure-1.

The value and the quantity tallied with the invoice, but the invoice number was wrongly noticed as 002179; which was actually 002172. This was just a clerical mistake - was the contention. The detaining authority, however, rejected the contention of the petitioner and imposed penalty, as per the impugned order at the maximum prescribed under Section 60(4) of the Act.

The Court pointed out, “We cannot but notice that the documents produced by the petitioner does not prove the genuineness of the transport as has been contended by the learned Government Advocate.”

The Court noted and pointed out that the detention was in the early hours of 02.01.2015 and the invoice generated as Annexure-3 series with the supporting documents were generated after the detention; definitely on coming to know of the detention at the check-post and the mistake in invoice number as revealed from the SUVIDHA Form having been noticed by the Check-Post Authority.

The Court further noted that the invoices were serially numbered and there is no evidence to show the last serial number of the invoice on the day on which the transport commenced.

The Court also noted that the identity in value was evident from the invoice and the SUVIDHA Form, but, however, the quantity noticed in the notice ws handwritten and not by the authorized signatory.

The Court said that Determining whether there shall be always a mens rea for imposition of penalty, Guljag Industries v. Commercial Taxes Officer, (2007) 7 SCC 269 is very relevant.

Further placing reliance on Guljag Industries (supra), the Court said, that in the case, it has been categorically held that Section 78 (2), the contravention of which was the controversy in the cited decision results in a civil liability and even if the goods are exempt from taxation, if the transportation is not supported by requisite declaration, then there is no question of a presumption of mens rea preceding the imposition of penalty.

The Court opined that the facts in the aforesaid case had to be looked at with the declaration of law in Guljag Industries (supra) and D. P. Metals (supra), in mind.

In the present case, the Court said there was a mistake in the invoice number as indicated in the declaration form which was accompanying the transport.

The Court observed, “A reasonable ground of attempt to carry out multiple transport arise, since if there was no checking at the check-post then there could have been a further transport made under the same invoice, thus, enabling an inter-State sale of the goods transported by the subject invoice and SUVIDHA Form, which could go unnoticed by the Department.”

“Section 60(4) enables a seizure of goods along with the carrier if the authority suspects the transport to be in contravention of the provisions of Section 60(2). Section 60(4) (b) makes Section 56 applicable mutatis mutandis. Penalty is imposable under Section 56(4) (b) if the person in charge of the goods fails to satisfy the officer regarding the proper accounting of goods. The ingredients of Section 60(4) (b) read with Section 56(4) (b) are available in the instant case,” the Court added.

Finding no reason to interfere with the penalty imposed., the Court dismissed the writ petition.

Appearance:

For the Petitioner/s : Mr. S. D. Sanjay, Senior Advocate Mrs. Parul Prasad, Advocate Mrs. Priya Gupta, Advocate

For the Respondent/s : Mr. Vikash Kumar, SC-11

Case Title: M/s Ceat Ltd. vs The State of Bihar & Ors

LL Citation: 2023 LiveLaw (Pat) 150

Case No.: Civil Writ Jurisdiction Case No.835 of 2015

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