Technical lapse in filing Form No. 31 did not justify penalty absent intent to evade tax.

Penalty for failure to furnish Form No. 31 on imported purchases was not sustainable where the transactions were recorded in the books, the account books were verified, the tax liability had been discharged, and there was no intention to evade tax. The omission was treated as a technical lapse, and statutory penalty could not be imposed absent deliberate defiance of law, contumacy, dishonesty, or conscious disregard of the obligation. On these facts, the penalty under section 28-A read with section 15-A(1)(o) of the U.P. Sales Tax Act, 1948 was held unjustified and liable to be quashed in favour of the assessee.

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Issues: Whether penalty was exigible for failure to furnish Form No. 31 in respect of imported purchases when the purchases were recorded in the books, the tax was paid, and there was no intention to evade tax.

Analysis: The omission to file Form No. 31 was found to be a technical lapse only. The purchases were duly recorded, the account books were verified, and the tax liability stood discharged. In such circumstances, penalty for breach of a statutory obligation could not be sustained unless the conduct showed deliberate defiance of law, contumacy, dishonesty, or conscious disregard of the obligation. The facts did not disclose any such element, and the absence of an intention to evade tax was decisive.

Conclusion: The penalty under section 28-A read with section 15-A(1)(o) of the U.P. Sales Tax Act, 1948 was not justified and was liable to be quashed in favour of the assessee.

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