Rajasthan High Court upholds penalty under Rajasthan Sales Tax Act, criticizes acceptance of alleged photocopies.

Assistant Commercial Tax Officer, Ward-I, Circle Bhiwadi (Alwar), Rajasthan Versus Mahindra Met Plast Pvt. Ltd. and another

Assistant Commercial Tax Officer, Ward-I, Circle Bhiwadi (Alwar), Rajasthan Versus Mahindra Met Plast Pvt. Ltd. and another - [2014] 70 VST 290 (Raj) Issues:
Assessment of penalty under section 78(5) of the Rajasthan Sales Tax Act based on discrepancies in bill presented during vehicle interception.

Analysis:
The High Court of Rajasthan heard a revision petition filed by the petitioner-assessing officer challenging the deletion of penalty imposed on the respondent-assessee under section 78(5) of the Rajasthan Sales Tax Act. The penalty was imposed after discrepancies were found in a bill presented during the interception of a vehicle loaded with goods. The bill lacked a bill number, leading the authorities to suspect it was forged. The respondent-assessee admitted the mistake but requested the case be closed after levying the penalty. The Deputy Commissioner (Appeals) (DC (A)) deleted the penalty based on photostat copies of bill books produced, stating there was no tax evasion as the goods were sold on C form. The Tax Board upheld this decision, prompting the revision petition.

The petitioner-assessing officer argued that the bill was clearly forged, as goods cannot be transmitted without a bill number. Despite granting ample time to produce books of accounts, the respondent-assessee's representative admitted the mistake and requested penalty imposition. The petitioner-assessing officer contended that the DC (A) erred in accepting alleged photocopies as evidence without proper verification. The respondent-assessee's counsel defended the decision, stating that the sale was tax paid and no evasion occurred. They cited previous judgments to support their case.

The High Court found in favor of the petitioner-assessing officer, noting that the respondent-assessee admitted the mistake and requested the penalty. The Court criticized the DC (A) for admitting photocopies without allowing rebuttal and faulted the Tax Board for blindly following the DC (A)'s decision. The Court emphasized the importance of bill numbers, stating that their absence could lead to manipulation. The Court concluded that the penalty was justified, and the orders deleting it were reversed. Consequently, the orders of the Tax Board and DC (A) were quashed, and the petitioner-assessing officer's original penalty order was upheld.