Mere existence of some discrepancies may not have ever led the revenue authority to the conclusion that tax had been evaded or the transaction had not been disclosed.
Section 130 of the CGST Act, 2017— Goods In Transit –— The petitioner challenged order dated 18.6.2020 passed by the appellate authority, vide which the appeal authority has partly allowed the appeal, arising from the proceedings under Section 130(2) of the Act. The counsel for petitioner submitted that the assessing authority had passed an order under Section 130 and treated the entire stock of iron scrap discovered during the survey dated 31.5.2019 to be undisclosed/concealed stocks. That conclusion had arisen solely on account of the non-production of books of accounts by the petitioner. The assessing authority vide order dated 19.3.2020 had determined the turnover of iron scrap at Rs. 7,46,50,000/-. The petitioner filed an appeal against the said order. The appeal authority has partly allowed the appeal and sustained the imposition of tax and penalty on the balanced turnover of Rs. 20,00,000/- only, that refers to two "loose purchases" for which the petitioner's explanation was rejected. The petitioner submitted that even those two purchases were duly explained, inasmuch as, the same were really not in the shape of the loose documents but the same were regular tax invoice of the assessee. The court observed that once the revenue authority admits that the invoice and the e-way bills relied upon by it, had been issued in regular course, it is difficult to imagine how the appeal authority could have reached a conclusion that the goods sold or purchased against those invoices were unaccounted for. The invoice is primary evidence of the transaction. Unless the revenue authority disputes its genuineness, it cannot be lightly overlooked.
Held that:- The Hon’ble High Court set aside the order dated 18.6.2020 and remitted matter to the appeal authority to pass a fresh order.
Mere existence of some discrepancies may not have ever led the revenue authority to the conclusion that tax had been evaded or the transaction had not been disclosed.
Section 130 of the CGST Act, 2017— Goods In Transit –— The petitioner challenged order dated 18.6.2020 passed by the appellate authority, vide which the appeal authority has partly allowed the appeal, arising from the proceedings under Section 130(2) of the Act. The counsel for petitioner submitted that the assessing authority had passed an order under Section 130 and treated the entire stock of iron scrap discovered during the survey dated 31.5.2019 to be undisclosed/concealed stocks. That conclusion had arisen solely on account of the non-production of books of accounts by the petitioner. The assessing authority vide order dated 19.3.2020 had determined the turnover of iron scrap at Rs. 7,46,50,000/-. The petitioner filed an appeal against the said order. The appeal authority has partly allowed the appeal and sustained the imposition of tax and penalty on the balanced turnover of Rs. 20,00,000/- only, that refers to two "loose purchases" for which the petitioner's explanation was rejected. The petitioner submitted that even those two purchases were duly explained, inasmuch as, the same were really not in the shape of the loose documents but the same were regular tax invoice of the assessee. The court observed that once the revenue authority admits that the invoice and the e-way bills relied upon by it, had been issued in regular course, it is difficult to imagine how the appeal authority could have reached a conclusion that the goods sold or purchased against those invoices were unaccounted for. The invoice is primary evidence of the transaction. Unless the revenue authority disputes its genuineness, it cannot be lightly overlooked.
Held that:- The Hon’ble High Court set aside the order dated 18.6.2020 and remitted matter to the appeal authority to pass a fresh order.