TaxTMI 
TaxTMI 
TaxTMI 
2018 (9) TMI 157
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....s unsustainable in law. 03. Brief facts which are considered essential to appreciate the challenge may be introduced at the outset. The petitioners are the registered dealers under the Central Sale Tax Act, 1956, in short CST Act and under Tripura Value Added Tax Act, 2004, in short TVAT Act. The petitioners are engaged in the business of manufacturing and sale of bricks. In order to facilitate mechanisation within the manufacturing process of the bricks in his brickfield the petitioner in the W.P.(C) No.284 of 2014 purchased a JCB machine (Excavator) from M/S. JCB India Limited, Ballabgarh, Haryana. The petitioner purchased the said machine on payment of the price i.e. Rs. 18,50,000/- and issued 'C' form to M/S. JCB India Limited. The said purchase is the subject matter of W.P.(C) 284 of 2014. The Superintendent of Taxes, Belonia issued a notice on 03.03.2014 seeking explanation from the petitioner as to why a penalty @ 150% on the leviable tax on the value of the JCB machine shall not be imposed under Section 10A of the CST Act. Having received the said notice, the said petitioner submitted the reply to the respondent No.4, the Superintendent of Taxes, Belonia on 06.03.2014. It ....
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....to non-availability of earth we had to carry earth from various places at a distance of 7/8 KM by utilising the aforesaid JCB. But it is not a fact that the aforesaid JCB is being used only for manufacturing process of green bricks and misusing the purpose in strong violation of the CST Act. It may be mentioned in this connection that we have arranged two local made molding machine of earth and the JCB is only the instrument which are fully engaged for loading of earth. In addition, it is also used for loading of bricks/bats/rubbish. We had to maintain drainage system/internal road/approach road around the brick field by utilizing the said machine. As a result of the above situation, it cannot be said that the JCB is used only for excavating earth as mentioned in your letter referred to above rather, it can safely be concluded that the JCB is utilizing for other purposes in addition to excavation of earth only." 07. The notice dated 07.05.2014 and the reply dated 28.05.2014 are available as Annexure-P/2 collectively in the said writ petition. Despite the said explanation by the order dated 09.06.2014, the respondent No.4 had observed as under: ".....the petitioner has violated th....
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....ng of the bricks. According to the revenue, the petitioner in order to evade tax has adopted unfairness by way of contravening Section 8(3)(B) of the CST Act. Such contravention comes within the purview of Section 10B of the CST Act. According to Mr. Pal, learned counsel, the respondent No.4 had no authority to assess the tax or other consequential liability inasmuch as Section 33 of the TVAT Act clearly provides that no assessment under section 31 and 32 shall be made after the expiry of five years from the end of the tax period to which the questioned assessment relates. 11. Mr. Pal, learned counsel appearing for the petitioner has asserted that from the 'C' form it would be apparent that the machines were purchased on or before 28.05.2008 on payment of the said price [in W.P.(C) No.448 of 2014] and on 20.08.2009 so far the purchase relating to W.P.(C) No.284 of 2014 is concerned. As far as the purchase of the JCB machine on 20.05.2008 is concerned, the five years period of limitation would start from 01.04.2009, meaning after 31.03.2014 and hence the respondent No.4 will have no authority to assess or pass any order in this regard having been barred under Section 33 of the TVAT....
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....sale or [in the tele-communications network or] in mining or in the generation or distribution of electricity or any other form of power; (c) are containers or other materials specified in the certificate of registration of the registered dealer purchasing the goods, being containers or materials intended for being used for the packing of goods for sale; (d) are containers or other materials used for the packing of any goods or classes of goods specified in the certificate of registration referred to in 6 [***] clause (b) or for the packing of any containers or other materials specified in the certificate of registration referred to in clause (c). [(4) The provisions of sub-section (1) shall not apply to any sale in the course of inter-State trade or commerce unless the dealer selling the goods furnishes to the prescribed authority in the prescribed manner a declaration duly filled and signed by the registered dealer to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribed authority: Provided that the declaration is furnished within the prescribed time or within such further time as that authority may, for sufficient ca....
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....tly related to the actual production." 14. Mr. Pal, learned counsel has contended that the contravention of Section 10 of the CST Act cannot assume for penal action unless it is established that there was mens rea. For purpose of reference, Section 10 of the CST is reproduced: 10. Penalties.-If any person- [(a) furnishes a declaration under sub-section (2) of section 6 or sub-section (1) of section 6A or sub-section (4) 3[or sub-section (8)] of section 8, which he knows, or has reason to believe, to be false; or (aa) fails to get himself registered as required by section 7 or fails to comply with an order under sub-section (3A) or with the requirements of sub-section 3(C) or sub-section (3E) of that section;] (b) being a registered dealer, falsely represents when purchasing any class of goods that goods of such class are covered by his certificate of registration; or (c) not being a registered dealer, falsely represents when purchasing goods in the course of inter-State trade or commerce that he is a registered dealer; or (d) after purchasing any goods for any of the purposes specified in 4[clause (b) or clause (c) or clause (d)] of sub-section (3) [or sub-section (6)] of s....
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....section 10, in the State in which the person purchasing the goods should have registered himself if the offence had not been committed.] 16. Mr. Pal, learned counsel has taken us to a decision of the apex court in Commissioner of Sales Tax, Uttar Pradesh vs. Sanjiv Fabrics reported in (2010) 9 SCC 630, where the apex court has observed as under: "36. In view of the above, we are of the considered opinion that the use of the expression "falsely represents" is indicative of the fact that the offence under Section 10(b) of the Act comes into existence only where a dealer acts deliberately in defiance of law or is guilty of contumacious or dishonest conduct. Therefore, in proceedings for levy of penalty under Section 10A of the Act, burden would be on the revenue to prove the existence of circumstances constituting the said offence." [Emphasis added] 17. From the other side, Mr. D.C. Nath, learned Addl. G.A. appearing for the respondents No.2, 3 and 4 has admitted and asserted that the petitioner is a registered dealer under Section 19 of the TVAT Act and Section 17 of the CST Act. He has been registered as manufacturer, re-seller and importer etc. From the CST registration certif....
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....ure has, in the said section, used the expression "falsely represents" in contradistinction to "wrongly represents." The word "false" has two distinct and well-recognised meanings: (1) intentionally or knowingly or negligently untrue and (2) untrue by mistake or accident, or honestly after the exercise of reasonable care. A thing is called "false" when it is done, or made, with knowledge, actual or constructive, that it is untrue or illegal, or is said to be done falsely when the meaning is that the party is in fault for its error. Thus the use of expression "falsely represents" is indicative of the fact that the offence under Section 10(b) of the CST Act comes into existence only where a dealer acts deliberately in defiance of law or is guilty of contumacious or dishonest conduct. Therefore, in proceedings for levy of penalty under Section 10-A of the CST Act, the burden would be on the Revenue to prove the existence of circumstances constituting the said offence. In the light of the language employed in Section 10-A and the nature of penalty contemplated therein, it cannot be held that all types of omissions or commissions in the use of Form C will be embraced by the expression "....