SRI MATHA VYSHNAVI COLD STORAGE (P) LTD. Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) THESE two appeals have been preferred by the appellant M/s. Sri Matha Vyshnavi Cold Storage (P) Ltd., Khammam and M/s. Sri Vyshnavi Cold Storage (P) Ltd., Khammam. The assessee is on the rolls of Assistant Commercial Tax Officer -I, Khammam. The assessment year relates to 1998 -99. The assessing officer levied penalty of Rs. 2,14,017/ - (T.A. No. 609/03) and Rs. 1,50,588/ - (T.A. No. 608/03) for misuse of 'C' Forms. The facts leading to the present appeals are as follows. The appellant company is registered under Companies Act. It is engaged in Cold Storage Business. It carries on activity of storing chillies, tamarind and other products by storing charges. The appellant applied for registration of its company in Form -A as a dealer U/s. 7(1) and 7(2) of the CST Act, 1956 and read with Rule 3 & 4 of the CST Rules, 1956. The registering authority after inspecting the business premises granted the necessary licence and issued registration certificate in Form -B under Rule 5(1) of the CST Rules.

(2.) THE appeal grounds are common in both the appeals. They are in brief as follows. The appellant bonafidely with good intention requested for issue of 'C Forms and the appropriate authority having been satisfied, issued the 'C Forms for purchase of machinery for the Cold Storage Business. The registering authority is not right in imposing maximum penalty. In good faith, when he applied for registration under CST Act, 1956, there is no question of mis -representation or suppression of his business. The registration certificate as well as 'C Forms issued only after having been satisfied about his business. The issuance of 'C Forms and purchase of machinery and equipment squarely falls within the four corners of law. Hence, both the appeals are to be allowed.

(3.) ON the other hand, the learned State Representative represented that business of the appellant is that of storage of chillies, tamarind, food grains etc., and purchase of machinery and other parts is nothing to do with his business and hence the penalty levied is in accordance with law.