Stock transfer penalty cannot stand when ST-18A was not required before the notification made it mandatory.

Penalty under section 78(5) of the Rajasthan Sales Tax Act was not sustainable where goods were moved on stock transfer before the notification dated 30.3.2000 made the ST-18A declaration mandatory for such transfers. Although an incomplete declaration form may ordinarily support penalty, the controlling fact was that the movement occurred on 21.2.1998, when no ST-18A form was required for stock or branch transfers. The statutory basis for penalty was therefore absent, and the revision was decided in favour of the assessee.

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Issues: Whether penalty under section 78(5) of the Rajasthan Sales Tax Act, 1994 was leviable for carrying goods on stock transfer with an incomplete ST-18A declaration form, where the movement of goods took place before the notification dated 30.3.2000 made such form unnecessary for stock or branch transfer.

Analysis: The revision was founded on the premise that an incomplete declaration form attracted penalty. The Court noted that although incompleteness of the form may ordinarily justify penalty, the controlling facts in the present case were different because the goods were admittedly being moved on stock transfer on 21.2.1998, prior to the notification dated 30.3.2000. In light of the earlier decision settling that no ST-18A form was required for such transfers before the notification, the statutory basis for penalty was absent.

Conclusion: Penalty under section 78(5) was held not leviable, and the revision was decided against the Revenue and in favour of the assessee.

Ratio Decidendi: Where goods are moved on stock or branch transfer before the relevant notification makes a declaration form mandatory, penalty cannot be sustained merely because the form was incomplete or absent.

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