Penalty under sales tax law needs clear finding of intent to evade tax; seizure upheld for statutory way-bill breach.

Penalty under section 68 of the West Bengal Sales Tax Act, 1994 required a clear finding of deliberate intention to evade tax, and no such specific finding was recorded by the seizing officer or the first revisional authority. On that material, the penalty could not be sustained and the question was remitted for fresh consideration by the second revisional authority. A violation of section 68 read with rule 211 of the West Bengal Sales Tax Rules, 1995 was nevertheless found, and that breach justified the seizure. The seizure was therefore upheld as legal and valid, while release of the goods was directed on undertaking pending revision.

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Issues: (i) Whether penalty under section 68 of the West Bengal Sales Tax Act, 1994 could be sustained without a clear finding of deliberate intention to evade tax. (ii) Whether the seizure made for violation of section 68 read with rule 211 of the West Bengal Sales Tax Rules, 1995 was legal and valid.

Issue (i): Whether penalty under section 68 of the West Bengal Sales Tax Act, 1994 could be sustained without a clear finding of deliberate intention to evade tax.

Analysis: Penalty under section 68 requires a clear and specific finding by the authority that the dealer had a deliberate intention to evade tax. The record did not disclose any such clear finding by either the seizing officer or the first revisional authority. As the question of mens rea was not expressly determined, the penalty issue could not be finally affirmed on the existing material.

Conclusion: The penalty could not be sustained on the present findings and the question was left to the second revisional authority for fresh consideration.

Issue (ii): Whether the seizure made for violation of section 68 read with rule 211 of the West Bengal Sales Tax Rules, 1995 was legal and valid.

Analysis: The Tribunal held that there had been violation of section 68 read with rule 211. That statutory breach justified the initial action of seizure, independent of the unresolved penalty question.

Conclusion: The seizure was declared legal and valid.

Final Conclusion: The matter was remitted only on the question of penalty, while the legality of the seizure was affirmed and the goods were directed to be released on undertaking pending the revisional decision.

Ratio Decidendi: Penalty under section 68 can be sustained only on a clear finding of deliberate intention to evade tax, whereas a statutory violation of the way-bill requirement can still justify seizure.

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