Procedural lapse in invoice pre-authentication did not justify penalty where there was no suppression or misstatement.

Issuance of a modvatable invoice without prior pre-authentication of the invoice book was treated as a procedural lapse that was curable and, by itself, did not justify penalty. Penalty proceedings initiated nearly two years later were also held unjustified because there was no suppression or misstatement attributable to the appellant. On these facts, the penalty was found unsustainable and was set aside.

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Issues: Whether penalty was sustainable for issuance of a modvatable invoice without prior pre-authentication of the invoice book by the jurisdictional Superintendent, and whether initiation of penalty proceedings after a delay of about two years was justified in the absence of suppression or misstatement.

Analysis: The invoice was issued without first getting the invoice book pre-authenticated, but the lapse was procedural in nature and curable. The penalty proceedings were initiated nearly two years after the invoice was issued, and there was no suppression or misstatement attributable to the appellant. In these circumstances, the delay was not treated as a reasonable basis for imposing penalty.

Conclusion: The penalty was not sustainable and was set aside.

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