Composition penalty for spurious sale bills fell under the residual offence clause, making excess collection refundable.

Composition for violation of section 30(8) was treated as a penalty for issuing spurious sale bills, not as a case of tax non-payment or evasion. A later assessment order deleting the disputed turnover did not disturb the basis of the composition order. For fixing the maximum composition amount, section 32(1)(a) applied only to offences involving failure to pay or evasion of tax recoverable under the Act, while section 32(1)(b) governed other offences. On that footing, the offence fell under clause (b), and the amount collected could not exceed the then-applicable limit of Rs. 1,000; the excess was refundable.

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Issues: Whether the compounding amount collected for violation of section 30(8) was liable to be refunded in view of the later assessment order, and whether the case fell under section 32(1)(a) or section 32(1)(b) for the purpose of fixing the maximum composition amount.

Analysis: The composition order was founded on the issuance of spurious sale bills and the violation of section 30(8), not on a case of failure to pay or evasion of tax due. The subsequent deletion of the disputed turnover in assessment proceedings did not dislodge the basis of the composition order. However, section 32(1)(a) applies only where the offence consists of failure to pay or evasion of tax recoverable under the Act, while section 32(1)(b) governs other offences. Since the present offence was not one of tax evasion or non-payment, it fell within clause (b), and the amount collected could not exceed the then-applicable limit of Rs. 1,000.

Conclusion: The composition amount was valid only to the extent of Rs. 1,000, and the balance collected was refundable to the assessee.

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