Technical breach in declaration filing did not justify penalty where no evasion, dishonesty, or contumacious conduct was shown.

Penalty for importing goods without furnishing form XXXI was held unsustainable because the record showed only a technical breach. The goods were used as raw material, duly accounted for in the books, and there was no evidence of suppressed turnover, tax evasion, dishonest conduct, or conscious disregard of the statutory obligation. In these circumstances, the default was treated as a venial lapse rather than contumacious non-compliance, and the penalty levy was quashed.

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Issues: Whether penalty under section 15-A(1)(o) of the U.P. Sales Tax Act, 1948 was leviable for importing goods without furnishing form XXXI as required by rule 87-A of the U.P. Sales Tax Rules, where the breach was claimed to be bona fide and technical.

Analysis: The revisionist had imported goods without complying with the declaration requirement, but the record did not show any attempt to evade tax or any suppressed turnover. The goods were found to have been used as raw material and duly accounted for in the books of account. The material on record did not establish conduct amounting to deliberate defiance of law, contumacious behaviour, dishonesty, or conscious disregard of statutory obligation. On these facts, the default was held to be a technical or venial breach, and penalty was not justified merely because the statute permitted it.

Conclusion: Penalty under section 15-A(1)(o) was not sustainable, and the levy was quashed in favour of the petitioner.

Final Conclusion: The revision succeeded because the statutory default was found to be technical rather than culpable, and the penalty order was set aside.

Ratio Decidendi: Even where a statutory default is established, penalty is not warranted if the breach is merely technical and the record does not disclose contumacious, dishonest, or deliberately evasive conduct.

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