Independent penalty findings can sustain concealment penalty when concealment and mens rea are proved on the record.

Penalty for concealment under the U.P. Sales Tax Act may be sustained where the authority, in independent penalty proceedings, gives the assessee a fresh opportunity and records factual findings of concealed turnover and business outside the books on the material and explanation before it. The text states that the penalty was not based on a mechanical adoption of the assessment order; rather, concealment and mens rea were found independently in the penalty proceedings themselves. On that basis, the challenge that no separate foundation existed for penalty failed, and the finding of concealment was treated as one of fact not open to revision.

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Issues: Whether penalty under section 15-A(1)(c) of the U.P. Sales Tax Act was validly imposed and restored on the basis of an independent finding of concealment and mens rea recorded in the penalty proceedings.

Analysis: The penalty was not imposed merely by mechanically adopting the assessment findings. In the penalty proceedings, the assessee was given a fresh opportunity to explain the matter, and the authorities recorded independent findings from the material and the explanation that the assessee had concealed turnover and had carried on business outside the books. The Tribunal affirmed these findings. Since concealment was found as a fact in the penalty proceedings themselves, and mens rea was also recorded, the challenge based on absence of a separate penalty foundation failed. The finding of concealment was treated as a finding of fact not open to interference in revision.

Conclusion: The penalty under section 15-A(1)(c) was upheld and the revision was dismissed in favour of the Revenue.

Ratio Decidendi: A penalty for concealment can be sustained when the authority, in independent penalty proceedings, records a factual finding of concealment and requisite mens rea on consideration of the assessee's explanation and the material on record.

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