Penalty for alleged tax evasion cannot rest on mere document discrepancies or suspicion without independent verification.

Penalty under Section 78(5) of the Rajasthan Sales Tax Act could not be justified on mere discrepancies in transport documents or the driver's statement when the papers were not found to be bogus or forged. The assessing authority also failed to make any independent verification from the consignor or consignee. On that basis, the finding of tax evasion rested only on suspicion, which was insufficient to sustain the penalty. The deletion of the penalty was therefore upheld, and no perversity was shown in the factual findings.

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Issues: Whether penalty under Section 78(5) of the Rajasthan Sales Tax Act, 1954 was justified on the basis of discrepancies in the transport documents and the driver's statement, and whether the absence of further enquiry from the consignor or consignee vitiated the penalty.

Analysis: The penalty could not be sustained merely because two sets of papers were found or because the vehicle was not stopped at the check post. The documents produced were not found to be bogus or forged, and the assessing authority did not conduct any independent verification from the consignor or consignee. The finding of tax evasion rested only on discrepancies and suspicion, which was insufficient in law to justify penalty. The appellate authorities therefore correctly treated the matter as one of fact and relied on the absence of proof of any deliberate attempt to evade tax.

Conclusion: The penalty under Section 78(5) was not sustainable and its deletion was rightly upheld.

Final Conclusion: The revision petition failed because no perversity was shown in the factual findings that the penalty was wrongly imposed.

Ratio Decidendi: Penalty for alleged tax evasion cannot be sustained on mere discrepancies or suspicion when the accompanying documents are not found to be false and no independent enquiry is made to establish deliberate evasion.

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