Bona fide belief and absence of mens rea defeated penalty reference over taxability of red chillies under sales tax law.

Differing views among members of the Board of Revenue on the taxability of red chillies supported the assessee's bona fide belief that the item was not taxable, so no guilty intention or mens rea could be attributed for non-payment of tax within time. On that basis, the Court found that the levy of penalty under section 16(1)(e) of the Rajasthan Sales Tax Act, 1954 did not raise a referable question of law. The request for a statement of the case and a reference was therefore refused.

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Issues: Whether, on the facts of the case, a reference on the levy of penalty under section 16(1)(e) of the Rajasthan Sales Tax Act, 1954 was warranted when the members of the Board of Revenue differed on the taxability of red chillies.

Analysis: The differing views of the members on the taxability issue supported the assessee's bona fide belief that the item was not taxable. In such circumstances, no guilty intention or mens rea could be attributed to the assessee for non-payment of tax within time. The matter did not disclose any question of law requiring the Court's opinion under the reference jurisdiction invoked.

Conclusion: No referable question of law arose, and the request to call for a statement of the case and to direct a reference was refused.

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