Late filing of ST18C declaration treated as compliance, defeating penalty under Rajasthan sales tax law

Subsequent filing of declaration form ST18C with the reply to the show-cause notice was treated as compliance with Section 78(2) of the Rajasthan Sales Tax Act, 1994, so penalty under Section 78(5) could not be sustained. The issue was held to be covered by the Supreme Court ruling in State of Rajasthan v. D.P. Metals, and the revenue failed to distinguish that precedent or show why it should not apply. On that basis, no substantial question of law was found.

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Issues: Whether production of declaration form ST18C along with the reply to the show-cause notice could be treated as compliance with Section 78(2) of the Rajasthan Sales Tax Act, 1994, so as to prevent penalty under Section 78(5) of the Act.

Analysis: The revision turned on whether the absence of ST18C at the time of checking was , or whether its subsequent filing with the reply to the notice cured the defect. The Board had held that later submission of the form constituted compliance with Section 78(2) of the Rajasthan Sales Tax Act, 1994, and relied on the Supreme Court decision in State of Rajasthan v. D.P. Metals. The department was unable to distinguish that ruling or show why it would not apply to the facts of the case. The Court found that the issue was fully covered by that precedent and that no substantial question of law arose.

Conclusion: The subsequent filing of ST18C with the reply to the show-cause notice was treated as compliance with Section 78(2) of the Rajasthan Sales Tax Act, 1994, and the penalty under Section 78(5) could not be sustained.

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