M.Ramakrishna, Chairman -
(1.) THIS appeal is filed against the orders of the learned Additional Commissioner of Commercial Taxes & Joint Commissioner (Legal) of the Commissioner of Commercial Taxes, Andhra Pradesh, Hyderabad in CCT's Ref. L. III(1)/255/B/94, dated 14.6.97, whereby reviewing the orders passed by the Appellate Deputy Commissioner (CT), Secunderabad Division, Hyderabad in Appeal No. 93/93 -94, dated 17.11.1993 after following the requisite procedure in issuing show cause notice setting aside the remand orders passed by the Appellate Deputy Commissioner and restoring the penalty proceedings of the Assistant Commercial Tax Officer, General Bazar, Secunderabad in Proceedings No. 2/93 -94, dated 14.7.93 whereby levy of penalty of Rs. 45,308/ - has been sustained. The facts that gave rise to the filing of the present appeal in brief are - The registering authority i.e. the Assistant Commercial Tax Officer, General Bazar, Secunderabad observed that the appellants purchased certain equipments viz., Fork -lift, diagnostic equipment for automobiles, wheel balancing and wheel aligning equipments, Gas -analyser etc., from other States against 'C' form declarations for Rs. 3,02,053/ - and used them in its work shops for servicing and repairing of motor vehicles. So, he issued a notice proposing levy of penalty on a sum of Rs. 45,308/ - being one and half times the tax due on the purchase turnover of Rs. 3,02,053/ - under Section 10(A)(1) of the Central Sales Tax Act, 1956 on 30.11.1992. After examining the reply filed by the appellants, the registering authority observed that the equipments purchased were installed permanently as immovable equipments and used them in solely labour contracts and not in works contracts. Accordingly, he confirmed the levy of penalty and passed order levying penalty of Rs. 45,308/ -. When the appellant preferred appeal before the learned Appellate Deputy Commissioner (CT), Secunderabad Division, Hyderabad, who by his orders dated 17.11.1993 referred to above, after hearing the learned authorised representative, remanded the matter by setting aside the levy of penalty and to decide about the same afresh by re -examining form 'A' filed (available on Registration File) together with form 'B' (Certificate of Registration) with reference to the laws governing the 'works contract' and specify the goods purchased by the appellants. Reviewing the said orders, the Additional Commissioner (CT) & Joint Commissioner (Legal) in the impugned orders set -aside the remand order and penalty order was restored. Hence, the appeal before us.
(2.) REITERATING the contentions urged before the lower authorities, it is contended by the learned authorised representative that from the certificate issued under the Central Sales Tax Act, 1956, dated 13.12.1989, bearing No. CST. Sec. 03/1 No. 1824/60 -61, it is evident that the name of the goods to be purchased by the dealer has not been mentioned at all and as such it is incorrect to mention in the show cause notice that the certificate was granted to the dealer to purchase spare parts of motors, oils and lubricants for resale purpose and not for purchase of equipment for work shop purpose. It is obligatory on the part of the Registering authority to issue a Certificate in Form 'B' in the prescribed form under CST Rules and not in the form issued to the dealer. In the application, in form A filed in duplicate, in one of the copies at Column 16, the words "the purchase of equipment" was noticed and therefore it should be deemed that the permission was granted to buy equipment also. The appellant had issued 'C' forms for the purchase of the equipments during the years 1986 -87, 1987 -88, 1988 -89; 1990 -91 & 1991 -92. The purchase value of the equipments for which 'C' forms have been issued amounted to Rs. 3,02,052 -84. These equipments are used for the repairs and servicing the vehicles and therefore the appellant is entitled to issue the declaration in Form -C for purchase of equipments. As the appellant can issue declarations in Form 'C, Levy of penalty of Rs. 45,308/ - is unlawful and therefore it should be set -aside. It is also his submission that the Joint Commissioner (Legal) is not justified in coming to the conclusion that the word 'equipment' in one of the copies was got interpolated. It is not the usual practice to submit applications in form -A in duplicate to obtain a copy of the CST Certificate misplaced by the appellant. It is only on the request of the registering authority, that the application in Form -A was filed on 26.9.1989. The appellant further submits that he was under the bona -fide belief that the purchase of equipment was permissible under the Certificate of Registration granted to him. The learned authorised representative has also submitted sequence of events and the details on which 'C' form registration was produced before the Deputy Commercial Tax Officer, General Bazar Circle, Secunderabad. On the other hand, the learned State Representative has relied upon the orders passed by the learned Joint Commissioner (Legal).
(3.) THE point for consideration is whether the levy of penalty is not justified?;