Civil penalty for check-post violation does not require mens rea; fresh decision ordered after hearing the assessee.

Penalty under Section 78(5) of the Rajasthan Sales Tax Act, 1994 was treated as a civil penalty that does not require proof of mens rea where there is violation of Section 78(2). The check-post authority's role was limited to verifying compliance and the availability of proper documents, while tax evasion was to be determined in assessment proceedings. Where the assessee is given an opportunity of hearing under Rule 55(1) of the Rajasthan Sales Tax Rules, 1995, the authority may examine the violation and impose penalty if established. The impugned orders were set aside and the matter was remitted for fresh decision after hearing the assessee.

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Issues: Whether penalty under Section 78(5) of the Rajasthan Sales Tax Act, 1994 could be sustained without proof of mens rea, and whether the matter required remand for fresh consideration after giving an opportunity of hearing.

Analysis: The governing legal position was treated as settled that mens rea is not an essential ingredient for levy of penalty under Section 78(5) when there is violation of Section 78(2). The check-post authority is concerned with examining compliance and the availability of proper documents, while the question of tax evasion is determined in assessment proceedings. Where the assessee is given an opportunity under Rule 55(1) of the Rajasthan Sales Tax Rules, 1995, the authority may enquire into compliance and impose civil penalty if the violation is established. In the present matter, the impugned orders of the authorities below were set aside and the assessment authority was directed to pass fresh orders after hearing the assessee.

Conclusion: Penalty under Section 78(5) did not depend on proof of mens rea, and the case was remitted for fresh decision in accordance with law after hearing the assessee.

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