Absence of intent to evade tax justified further reduction of penalty in a seizure matter.

Penalty in a seizure matter under the West Bengal Sales Tax Act, 1954 was held excessive because the materials showed no intention to evade tax. The applicant had sought guidance on the import procedure, applied to the competent authority for a permit on the date of seizure, and deposited advance tax shortly afterwards for issuance of the permit. On that basis, the tribunal found the penal burden warranted further reduction despite prior revision relief. The penalty was reduced further and the excess amount was ordered to be refunded, while the advance tax deposit was directed to be adjusted in the relevant assessment.

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Issues: Whether the penalty imposed in the seizure case under the West Bengal Sales Tax Act, 1954 required further reduction for want of intention to evade tax.

Analysis: The application was under section 8 of the West Bengal Taxation Tribunal Act, 1987. The challenge to the seizure itself was not pressed. On the materials produced, the applicant had been making inquiries about the procedure for import under the 1954 Act, had approached the competent authority for a permit on the date of seizure, and had deposited advance tax shortly thereafter for issuance of the permit. These facts showed that the applicant was not acting with the requisite intention to evade tax. The penalty, though already reduced in revision, was therefore excessive in the circumstances.

Conclusion: The penalty was further reduced from Rs. 30,000 to Rs. 15,000 and the excess amount was directed to be refunded. The advance tax deposit was directed to be adjusted in the relevant assessment.

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