Bona fide procedural lapse defeats penalty when price was disclosed on gate passes and departmental guidance was followed.

Penalty for failure to file the price list in the prescribed form was held unjustified where the assessee had declared price on gate passes, filed the classification list, and acted under a bona fide belief based on an earlier departmental letter. The assessee had cleared goods on gate passes showing value and duty, later disclosed the price by letter, and followed the procedure advised by departmental officers. On these facts, the lapse was treated as a technical, remediable procedural omission rather than a deliberate or mala fide default, so penal action was set aside.

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Issues: Whether penalty was sustainable for failure to file the price list in the prescribed form when the assessee had declared the price on gate passes, filed the classification list, and acted under a bona fide belief based on the Collector's earlier letter.

Analysis: The assessee had cleared the goods on gate passes showing value and duty paid, had previously received a letter permitting declaration of price on gate passes or accompanying challans, and had later disclosed the price by letter and followed the procedure advised by the departmental officers. In these circumstances, the lapse was found to be a technical and remediable procedural omission rather than a deliberate or mala fide default. The surrounding facts supported the assessee's bona fides and negatived the basis for penal action.

Conclusion: The penalty was not justified and was set aside in favour of the assessee.

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