Technical lapse in expired declaration form did not justify penalty when supporting tax documents were otherwise genuine and complete.

The Rajasthan HC held that penalty under Section 78(5) of the Rajasthan Sales Tax Act, 1994 was not justified where the declaration form was time-barred but the accompanying transaction documents were proper, genuine and otherwise in order. The expired form was treated as a technical lapse caused by inadvertence and human error, and the court found no adverse material showing an intention to evade tax. The declaration form was therefore not treated as non est merely because it had expired, and the order deleting the penalty was left undisturbed.

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Issues: Whether penalty under Section 78(5) of the Rajasthan Sales Tax Act, 1994 was justified when the declaration form was time-barred but all other accompanying documents were found to be in order.

Analysis: The time-barred declaration form was treated as a technical lapse caused by inadvertence and human error. The supporting documents were found proper, genuine, and acceptable, and no adverse material showed an intention to evade tax. The declaration form was not treated as non est merely because it had expired, and the matter was held to be covered by the earlier view that such lapses do not warrant penalty where the transaction papers are otherwise in order.

Conclusion: Penalty under Section 78(5) was not justified, and interference with the order deleting the penalty was declined.

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