VAT Appeal No. 13 of 2010 [ 1 ] IN THE HIGH COURT OF PUNJAB & HARYANA, CHANDIGARH VAT Appeal No. 13 of 2010 Date of Decision: 28.4.2010 M/s Gobind Traders .......................................................... Appellant Versus State of Punjab and others ........................................ Respondents Coram: Hon'ble Mr.Justice Ashutosh Mohunta Hon'ble Mr. Justice Mehinder Singh Sullar Present: Mr. Kishan Singh Baghi, Advocate for the appellant. ... ASHUTOSH MOHUNTA, J. The assessee has impugned the order (Annexure A-9) dated 13.3.2009 passed by the Chairman, VAT Tribunal, Punjab, vide which it was directed that the AETC i.e. the designated officer shall re-examine and decide the case afresh after giving effective opportunity to the dealer. Briefly the facts of the case are that during the course of checking vehicle No. HR01GA-0336, which was loaded with aluminum and steel utensils, was intercepted by the Excise and Taxation Officer at village Daon on the Daon-Kharar road. The ETO who intercepted the vehicle was of the opinion that there was an inter-state sale of the goods without payment of proper tax and also that the documents accompanying the goods VAT Appeal No. 13 of 2010 [ 2 ] were not proper and genuine. Accordingly, he referred the case to the AETC for imposition of penalty. The AETC vide his order dated 23.1.2006 imposed penalty upon the assessee under Section 51(7) (c) of the Value Added Tax Act. The assessee filed an appeal before the Joint Director (Enforcement), Patiala Division, Patiala, who vide order dated 23.3.2006 remanded the case back to the AETC for a fresh decision with a direction that the order be passed after hearing the dealer and after considering the evidence, if any, produced by him regarding the genuineness of the transaction. The correctness of the order dated 23.3.2006 vide which the case was remanded to the AETC was challenged by the assessee before the VAT Tribunal, Punjab, who vide its order dated 10.5.2006 set aside the order dated 23.3.2006 and the penalty imposed upon the appellant was quashed. The seized goods were also ordered to be released. Aggrieved by the order passed by the VAT Tribunal, the State of Punjab filed an application under Section 66(2) of the Punjab VAT Act for rectification of the order dated 10.5.2006. It was argued on behalf of the State that there is an inherent mistake in the order of the Tribunal as service of notice upon the driver of the vehicle has to be deemed to be valid service on the consignor or consignee of the goods in terms of Section 51 Explanation 2. On the other hand, it was argued on behalf of the dealer that it was incumbent for the designated officer to issue notice to the consignor or consignee and not to the driver. It was argued that as no notice was ever served upon the consignor or consignee, hence there was non-compliance of Section 51 (7) ( c ) of the Act and hence the notice was not valid and the VAT Appeal No. 13 of 2010 [ 3 ] AETC had no jurisdiction to impose penalty. The Tribunal held that in view of the Explanation 2 of sub- section 13 of Section 51 of the Punjab VAT Act, the observation and finding of the Tribunal was a mistake which was apparent on the fact of the record and, hence, the order was liable to be rectified. Accordingly, the order dated 10.5.2006 was rectified and recalled and the designated officer was directed to re-examine the case and decide it afresh. The assessee has impugned the order of rectification dated 13.3.2009 passed by the VAT Tribunal, Punjab. It has been argued that once the notice was not served upon the consignor or consignee and in fact the same was served upon the driver of the vehicle then the same would not constitute valid service and, hence no penalty can be imposed upon the dealer. A perusal of Explanation 2 of sub-section 13 of Section 51 clearly shows that the finding of the Tribunal was a mistake. The aforementioned provision is reproduced as under:- “For the purpose of sub section (7), service of notice on the representative of the owner or the driver or other person incharge of the goods vehicle, shall be deemed to be a valid service on the consignor or consignee or the goods.” The aforementioned provision clearly shows that service of notice on representative of the owner or driver shall be deemed to be valid service on the consignor or consignee. In view of the above, we are of the considered opinion that the Tribunal has rightly rectified the order dated 10.5.2006 passed by the Tribunal and remanded the case back to the AETC i.e. the designated office VAT Appeal No. 13 of 2010 [ 4 ] with a direction that he should decide the case afresh after affording opportunity to the dealer i.e. the present appellant. Resultantly, we find no merit in this appeal and the same is dismissed. ( ASHUTOSH MOHUNTA ) JUDGE 28.4.2010 ( MEHINDER SINGH SULLAR ) Rupi JUDGE