Penalty for missing check-post seal held unsustainable where required documents were available and tax had already been paid.

Where the vehicle in-charge carried the required documents and the tax had already been paid, the Rajasthan HC held that the mere absence of the departmental seal did not justify penalty under the Rajasthan Value Added Tax Act, 2003. Treating the relevant penalty provision as directory, and relying on the corresponding earlier Division Bench view under the Rajasthan Sales Tax Act, 1994, the Court found no basis to infer an intention to evade tax when the documents were available at the time of checking. The penalty was therefore not sustainable.

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Issues: Whether penalty was leviable for absence of seal on the documents when all required documents were available with the vehicle in-charge and the tax had already been paid.

Analysis: The penalty was imposed under section 76(11) of the Rajasthan Value Added Tax Act, 2003 for alleged violation of section 76(2)(a) of that Act. The Court noted that these provisions are pari materia with section 78(10A) of the Rajasthan Sales Tax Act, 1994. Relying on the earlier Division Bench view that the corresponding provision is directory and that no inference of intent to evade tax arises where the required documents are available at the time of checking, the Court found the case covered by that precedent. Since the required documents were present and tax had already been paid, the absence of the departmental seal did not justify penalty.

Conclusion: The penalty was not sustainable and the assessee succeeded.

Ratio Decidendi: Where the vehicle carries the required documents and tax has already been paid, a mere absence of the check-post seal does not establish an intention to evade tax, and the corresponding penalty provision is directory rather than mandatory.

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