Court No. - 59
Case :- SALES/TRADE TAX REVISION No. - 935 of 2007 Revisionist :- Paschimanchal Vidyut Vitran Nigam Ltd. Thru Its G.M.
Opposite Party :- Commissioner Trade Tax Counsel for Revisionist :- Ranjit Saxena,Nripendra Mishra,Pankaj Kumar Shukla Counsel for Opposite Party :- C.S.C.
Hon'ble Saumitra Dayal Singh,J.
1. Heard Shri Nripendra Mishra, learned counsel for the applicant-assessee and Shri B.K. Pandey, learned Standing Counsel for the respondent-revenue.
2. Present revision has been filed by the assessee against the order passed by the Trade Tax Tribunal, Moradabad dated 18.05.2007 in Second Appeal No. 103 of 2007 for A.Y. 2006-07 under Section 8D(6) of the U.P. Trade Tax Act, 1948 (hereinafter referred to as the 'Act'). By that order, the Tribunal has partly allowed the appeal filed by the assessee and reduced the quantum of penalty from 8 percent to 4 percent, being the amount equal to tax.
3. The facts, in brief, are that the assessee is the electricity distribution company, engaged in supply of energy. During the year in question, the assessee had awarded works contract to different contractors under the Rajiv Gandhi Grameen Vidyutikaran Yojana. Admittedly, it did not make deductions at source on payments made to such contractors. Treating the same to be infringement of the provisions of Section 8D of the Act, penalty under Section 8D(6) was imposed on the assessee equal to twice the amount of tax. While the Tribunal has reduced the quantum of penalty from twice the amount of tax to equal the tax, the assessee claimed that it was not liable to deduction of tax on payment made to the contractors in view of notification no. KA.NI-1283 XI-9(24)/2006 dated 13.07.2006.
By that notification, the payments made under the Rajiv Gandhi Grameen Vidyutikaran Yojana had been made exempt from deductions of tax at source.
4. Opposing the revision, learned Standing Counsel would submit that the aforesaid notification came into effect from 13.07.2006 and not earlier. Therefore, the assessee continued to be liable to make deductions of tax at source for the period 01.04.2006 to 12.07.2006. Consequently, the penalty has been imposed on the assessee only for that period and not thereafter.
5. Having heard learned counsel for the parties and having perused the record, it cannot be disputed that the penalty has been imposed only for the period 01.04.2006 to 12.07.2006. During that period, the payments made to the contractors had not been made exempt from deductions of tax at source. In absence of such deductions having been made, the penalty imposed was wholly justified, as such penalty was not for any guilty conduct but for non-compliance of mandatory provisions of law with respect to deductions of tax at source. The amount of penalty having already been reduced equal to amount of tax, no further interference is required with the same. The order of the Tribunal is wholly justified and based on correct appraisal of law.
6. Revision lacks merit and is accordingly dismissed.
Order Date :- 21.8.2019 AHA