Penalty for false accounts cannot apply before a return is filed when liability is computed from returned turnover.

Section 48 of the Haryana General Sales Tax Act, 1973 applies only after a return has been filed, because its penalty formula is computed by reference to the turnover as returned by the dealer. The provision presupposes an existing return and becomes workable only when false or incorrect accounts are linked to that filed return. Where false accounts are detected before filing of the return, the statutory precondition for invoking the penalty mechanism is absent, so section 48 cannot be applied in that situation.

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Issues: Whether section 48 of the Haryana General Sales Tax Act, 1973 applies where false accounts are detected before the filing of the return.

Analysis: Section 48 authorises penalty where a dealer maintains false or incorrect accounts with a view to suppressing sales, purchases or stocks, or furnishes false or incorrect account, return or information. The provision, however, quantifies the penalty with reference to the amount of tax avoided if the turnover as returned by the dealer had been accepted as correct. That statutory formula necessarily presupposes the existence of a return. Reading the section as a whole, the power to impose penalty under this provision becomes workable only after a return has been filed, because the turnover as returned is the basis for computing the amount of penalty. Where false accounts are found before filing of the return, the statutory precondition for applying the penalty mechanism under section 48 is absent.

Conclusion: Section 48 is not applicable to cases where maintenance of false accounts is detected before the filing of the return.

Ratio Decidendi: A penalty provision that measures liability by reference to the turnover as returned by the dealer can be invoked only after a return has been filed.

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