DIPAK MISRA, J. - (1.) Leave granted.
(2.) The respondent, a dealer registered under Section 8-A of the U.P. Trade Tax Act, 1948 (for brevity, "the Act"), is a holder of a recognition certificate as per provisions contained in Section 4-B of the Act. The respondent used to make purchases of raw material at the concessional rate of tax against Form III-B obtained by it from the office of the Trade Tax Officer. As per conditions prescribed under Section 4-B(2) of the Act, the notified goods manufactured out of the raw material produced at the concessional rate of tax against Form III-B is required to be sold by such manufacturer in the State or in the course of inter-State trade and commerce or in the course of export out of India. It is also provided in the said Section that if a recognition certificate holder sells goods manufactured by it out of the raw material purchased at the concessional rate of tax against Form III-B in a manner otherwise than prescribed under Section 4-B(2), the said dealer shall be liable to penal action equal to three times of the tax, thus saved by the said dealer on purchase made against Form III-B.
(3.) At the time of scrutiny, the assessing authority noticed that the respondent had made purchases of natural gas against Form III-B at the concessional rate of tax, and after manufacture of the notified goods, that is, fertilizers, out of the said purchases of natural gas purchased against Form III-B, some of the finished goods were transferred outside the State of Uttar Pradesh. The Revenue issued show cause notice to the respondent for the assessment year 2005-06 and after considering the explanation offered, imposed penalty of Rs.10,46.98,335/- vide order dated 28.03.2009. Being aggrieved, the respondent preferred an appeal under Section 9 of the Act before the Joint Commissioner (Appeals)-1, Commercial Tax, Bareilly being Appeal No. 798 of 2009, and the appellate authority vide its order dated 12.11.2009 dismissed the appeal and confirmed the order of the assessing authority dated 28.03.2009 passed under Section 3-B of the Act.;