Accepted belated return bars penalty when assessment proceeds without best judgment under sales tax law.

A belated return that has been accepted and assessed on that basis, without resort to best judgment, does not attract penalty under section 12(3) of the Madras General Sales Tax Act, 1959. The provision was held not to authorise penalty in such circumstances, because the assessment proceeded on the accepted return and the revenue acted beyond the jurisdiction conferred by section 12. The penalty was therefore unsustainable and the issue was decided in favour of the assessee.

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Issues: Whether penalty could be levied under section 12(3) of the Madras General Sales Tax Act, 1959 after a belated return had been accepted and an assessment made on that basis without resort to best judgment.

Analysis: The return, though filed belatedly, had been accepted and the assessment proceeded on that basis. In such circumstances, section 12 did not authorise the revenue to impose penalty. The levy of penalty was therefore beyond the jurisdiction conferred by the provision.

Conclusion: The penalty was not sustainable and the issue was decided in favour of the assessee.

Ratio Decidendi: Once a belated return is accepted and assessment is made on that basis without invoking best judgment, section 12 does not permit levy of penalty.

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