Penalty for unaccounted stock fails where weighment and foundational seizure requirements are not properly established.

Penalty under section 22(6)(b) of the Rajasthan Sales Tax Act requires proof that taxable goods were in the dealer's possession and remained unaccounted in the prescribed records. The assessing authority must establish those foundational ingredients before seizure or penalty can stand. Where the goods are identified by weight, proper verification and weighment are necessary to determine any unaccounted stock. On the facts noted, the silver was found in acid tanks, had not been properly weighed, and the basis for seizure and penalty was not satisfactorily proved. Mere non-registration did not by itself justify penalty, so the penalty was not sustainable.

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Issues: Whether penalty under section 22(6)(b) of the Rajasthan Sales Tax Act could be sustained when the alleged unaccounted silver was not actually weighed and the foundational requirements for seizure and penalty were not established.

Analysis: The provision authorises seizure and consequential penalty only where goods liable to tax are found in the dealer's possession and are not accounted for in the prescribed books or documents. The assessing authority bears the burden of proving the necessary ingredients before penalty can be imposed. Where the goods are to be identified by weight, a proper verification and weighment are necessary to determine the extent of unaccounted stock. On the facts recorded, the Tribunal found that the silver was lying in acid tanks, that the alleged stock had not been properly weighed, and that the basis of seizure and the penalty proceedings was not satisfactorily established. The circumstance that the assessee remained unregistered was relevant to conduct but did not by itself justify penalty.

Conclusion: The penalty was not sustainable and the Tribunal was justified in upholding the appellate order setting it aside.

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