2013 (2) TMI 674 - HC - VAT and Sales Tax

High Court Upholds Penalty Deletion due to Seller's Oversight

The High Court upheld the decisions of the Deputy Commissioner (Appeals) and the Tax Board, affirming the deletion of the penalty imposed under section ... Penalty u/s 78(5) of the Rajasthan Sales Tax Act, 1994 - Intention to evade tax - Held that:- Though the Act, provides that form No. ST-18A should be properly filled and is very essential to be produced at the time of checking or otherwise, at the time of carrying of the goods in a vehicle but in the present case, all other relevant papers/documents like bills, vouchers and authorisation letter, etc., were available with the driver of the vehicle at the time of checking but the Form No. ST 18-A which was available with the driver was incomplete only to the extent that the seller did not fill up the columns though purchaser had duly sent filled in form on his part and only on account of negligence of the clerk the incomplete form was handed over to the driver. Therefore, the respondent was prevented by good, sufficient and reasonable causes and there appears to be no mala fide, intention on the part of the respondent for evading the tax or otherwise, or to defraud the revenue. Respondent cannot be penalised for lapse if any, on the part of seller though on his part the columns were filled in and the petitioner-Department has not commented adversely on this aspect. - Decided against Revenue. Issues involved: Appeal against penalty imposed under section 78(5) of the Rajasthan Sales Tax Act, 1994 - Validity of penalty deletion by Deputy Commissioner (Appeals) and Tax Board.Analysis:1. The revision petition was filed against the order passed by the Rajasthan Tax Board, affirming the deletion of penalty imposed under section 78(5) of the Act. The penalty was initially imposed based on incomplete form ST-18A found during a goods check at a check-post. The assessing officer alleged an intention to evade tax, leading to the penalty of Rs. 25,865.2. The respondent contested the penalty, stating that the goods were fully tax paid, and any incompleteness in the form was due to the seller's oversight, not the purchaser's. The Deputy Commissioner (Appeals) reviewed the case and set aside the penalty, which was further upheld by the Tax Board after examining all relevant documents and orders passed by the assessing officer and Deputy Commissioner (Appeals).3. The petitioner-Department challenged the Tax Board's decision, arguing that the incomplete form ST-18A was a crucial document, and its proper filling was mandatory for transporting goods. They contended that the penalty was rightly imposed as the form was incomplete, despite other documents being in order. The petitioner claimed that the respondent should not have been exonerated from the penalty.4. The High Court, after considering the arguments, upheld the decisions of the Deputy Commissioner (Appeals) and the Tax Board. It noted that while form ST-18A was essential, in this case, the incomplete form was due to the seller's oversight, not the respondent's intention to evade tax. The court found no malafide intent on the respondent's part and agreed that the penalty deletion was justified based on the facts and circumstances of the case.5. The court concluded that there was no legal error in the decisions of the lower authorities, as there was no perversity in the Tax Board's order. The consistent findings of fact by the appellate authorities supported the deletion of the penalty, and no legal questions were raised. Consequently, the revision petition filed by the petitioner was dismissed for lacking merit.