2009 (4) TMI 839

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.... facts and circumstances, the Tribunal is right in having deleted the penalty levied under Section 12(5)(iii) of the Tamil Nadu General Sales Tax Act, 1959 for the assessment year 1992-93 when this Hon'ble Court in the case of P.S. Apparels vs. State of Tamil Nadu has upheld levy of penalty in respect of REP license from the assessment year 1992-93 onwards ?" 2. The penalty was deleted by the Tribunal observing as follows:- "For the same dealer and for the year 1995-96, the penalty levied by the Assessing Officer has been deleted by this Bench in T.A.No.395/1998, dated 5.1.2000. The following observations are made by us in that order. The case of the assessees from the beginning is that they were under the bonafide impression and ....

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....nder such circumstances, the appellants are entitled to the benefit of bonafides." 3. It is the case in which the penalty has been levied on the ground that the turnover in respect of sale of REP licence has not been offered for taxation. The issue as to whether the sale proceeds of REP licence are liable for taxation has been decided ultimately by this Court in the case of P.S.Apparels vs. Deputy Commercial Tax Officer, T.Nagar East Assessment Circle, Madras reported in 94 STC 139. Till such time, there was a considerable debate as to the possibility of levying sales tax on the turn over sale of REP licence. That is the reason, the Division Bench while upholding the levy of tax on sales of REP licences, summarised their conclusions as R....