Mandatory proof of tax payment with monthly returns sustained penalty for filing incomplete prescribed returns.

Penalty under section 12(5)(ii) of the Tamil Nadu General Sales Tax Act was held leviable where monthly returns were filed without proof of payment of the tax due. The Court noted that section 12(4)(ii) and rule 18(2) required the prescribed return to be filed within time and accompanied by proof of payment by the 20th of the succeeding month. On that combined reading, a return was complete only when both requirements were satisfied. As the returns for three months were filed without payment proof and tax was remitted only after substantial delay, they were not treated as prescribed returns and the statutory default attracted penalty.

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Issues: Whether penalty under section 12(5)(ii) of the Tamil Nadu General Sales Tax Act, 1959 was leviable for failure to file proof of payment of tax along with the monthly returns for the relevant assessment year.

Analysis: Section 12(4)(ii) required submission of the prescribed return within the prescribed time, and rule 18(2) required the monthly return to be filed by the 20th of the succeeding month along with proof of payment of tax due for that month. The combined effect of these provisions was that a return was complete only when it was filed within time and accompanied by proof of payment of the tax payable. Since the assessee filed the monthly returns for three months without such proof and the tax was paid only after substantial delay, the returns could not be treated as prescribed returns within the meaning of the Act and Rules. The default attracted penalty under section 12(5)(ii).

Conclusion: The penalty was rightly imposed and was sustainable in law.

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