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of <h1>High Court Upholds Decision on Penalty Under Rajasthan Sales Tax Act</h1> <h3>ACTO., Ward-I, Rajasmand Versus White Marble House</h3> The High Court upheld the decisions of the Deputy Commissioner (Appeals) and the Tax Board in setting aside the penalty imposed under section 65 of the ... - Issues:1. Imposition of penalty under section 65 of the Rajasthan Sales Tax Act, 1994 based on the authenticity of C forms received from a purchasing dealer.2. Assessment of the collusion of the selling dealer in the submission of fake C forms.3. Adequacy of the explanation provided by the assessee regarding the receipt of C forms through commission agents.4. Lack of further inquiry and reliance on assumptions by the assessing authority in imposing penalties.5. Justification of setting aside the penalty by the Deputy Commissioner (Appeals) and the Tax Board.6. Applicability of revisional jurisdiction under section 86 of the Rajasthan Sales Tax Act based on concurrent findings of the appellate authorities.Analysis:1. The revision petition challenged the order rejecting the Revenue's appeals and the assessee's cross-objections regarding the penalty under section 65 of the Rajasthan Sales Tax Act. The Tax Board set aside the penalty imposed by the assessing authority due to the authenticity concerns of C forms received from a Kerala dealer, affecting the concessional tax rate for the selling dealer.2. The Revenue contended collusion of the selling dealer in the submission of fake C forms, seeking restoration of the penalty. However, the Tax Board rejected the appeal, citing the failure of the assessing authority to establish such collusion, leading to the imposition of additional tax and interest but not the penalty.3. The assessee explained that the goods were sold through commission agents involved in inter-State trade, and the C forms were received through these agents, claiming ignorance of the forms' authenticity issues. The assessing authority dismissed this explanation based on the frequency of transactions with the purchasing dealer, assuming physical meetings that contradicted the assessee's claim.4. Despite the lack of further inquiry or witness summoning by the assessing authority, penalties were imposed based on unfounded assumptions. The Deputy Commissioner (Appeals) and the Tax Board set aside the penalty, highlighting the absence of evidence supporting the collusion allegation against the selling dealer.5. The appellate authorities justified their decisions by emphasizing the lack of effort by the assessing authority to establish the selling dealer's involvement in the production of fake C forms. The absence of a formal inquiry supported the setting aside of the penalty under section 65 of the Rajasthan Sales Tax Act.6. Given the concurrent findings of the appellate authorities, the High Court found no legal grounds for interference in the revision petition under section 86 of the Rajasthan Sales Tax Act. Consequently, the court dismissed the revision petition, upholding the decisions of the Deputy Commissioner (Appeals) and the Tax Board regarding the penalty imposition.
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