Reasonable cause for delayed tax deposit defeated penalty under the U.P. Trade Tax Act, with no intent to evade tax shown.

Penalty under Section 15-A(1)(a) of the U.P. Trade Tax Act can be imposed only where the dealer failed to deposit tax within time without reasonable cause. Here, the assessee attributed the delay to financial difficulty, substantial payments to cane growers, and expenditure on new machinery, and the record showed no intention to evade tax. The Tribunal noted the plea of financial crisis but did not make a clear finding on whether the explanation was unreasonable. On these facts, the explanation was treated as reasonable cause for the belated deposit, so the penalty was not justified and was set aside.

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Issues: Whether penalty under Section 15-A(1)(a) of the U.P. Trade Tax Act, 1948 was justified when the tax was deposited belatedly but the assessee claimed reasonable cause for the delay.

Analysis: Penalty under Section 15-A(1)(a) can be sustained only where the authority records a finding that the dealer failed to deposit tax within time without reasonable cause. The assessee explained that the delay occurred due to financial , substantial statutory payments to cane growers, and expenditure on new machinery. The Tribunal noted the plea of financial crisis but did not return a clear finding on whether such cause was reasonable. On the record, the delay was accepted as not being motivated by any intention to evade tax, and the explanation furnished was held to constitute reasonable cause for the belated deposit.

Conclusion: The penalty was not justified and was set aside.

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