Penalty for concealment requires proof of conscious concealment, not just addition in assessment or turnover magnitude.

Penalty under section 16(1)(e) of the Rajasthan Sales Tax Act was said to depend on a finding of conscious concealment or deliberate furnishing of inaccurate particulars, assessed in light of all the circumstances. Mere non-disclosure of turnover or an assessed addition was not treated as sufficient by itself to sustain penalty, and the filing of a revised return before completion of assessment was a material factor requiring consideration. The Board was criticised for placing undue weight on the size of the concealed turnover without applying the correct legal test. The penalty order was therefore not legally sustainable, and the matter was required to be redetermined in accordance with law, including any reassessment of quantum.

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Issues: Whether the penalty sustained under section 16(1)(e) of the Rajasthan Sales Tax Act, 1954, was vitiated for failure to consider whether there was conscious concealment or deliberate furnishing of inaccurate particulars, and whether the matter should be remitted for fresh determination of penalty and its quantum.

Analysis: The provision under consideration is penal in character and, in substance, requires examination of the whole of the circumstances before penalty can be upheld. Mere non-disclosure of a large turnover or the sustaining of an addition in assessment is not by itself conclusive for penalty. The relevant inquiry is whether the dealer consciously concealed particulars or deliberately furnished inaccurate particulars, and the filing of a revised return before completion of assessment was a material circumstance that had to be weighed in that context. The Board's approach was found to have given undue emphasis to the magnitude of the concealed turnover without applying the correct legal test to the penalty proceeding.

Conclusion: The order sustaining penalty was not legally sustainable, and the matter was required to be sent back for redetermination of the levy of penalty and, if necessary, its quantum in accordance with law.

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