2022 (1) TMI 862

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....ibunal, (Additional Bench), Coimbatore, relating to the respective assessment years 2000-01 and 2001-02. 2.The short question that arises for consideration in these writ petitions is as to whether the levy of penalty under Section 10A of the Central Sales Tax Act, 1956 for the offence committed by the petitioner under section 10(b) of the CST Act, is justified in the absence of a finding that the petitioner had "falsely represented" at the time of purchase of goods that the same were covered by the registration certificate issued to them. 3.Brief facts that are relevant, may be set out hereunder: i) The petitioner is engaged in the business of manufacture of Engineering Product, Coimbatore and an assessee on the files of the ....

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....titioner and Mr.V.Prashanth Kiran, learned Government Advocate (Tax) appearing for the respondents and also perused the materials placed before this court. 5. We find that the penalty under Section 10A of the CST Act, was mulcted on the petitioner / assessee for the offence committed under section 10(b) of the Act, on the ground that they had purchased the goods mentioned in the assessment orders, that were not covered by the CST registration certificate issued to them. The penalty so levied by the assessing officer was modified by the First Appellate Authority, as also affirmed by the Tribunal. 6. At the outset, it may be relevant to refer to Section 10(b) of the CST Act, for commission of which, the petitioner was levied with penalt....

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....ered by his certificate of registration. The expression "falsely represents" clearly shows that the element of mens rea is a necessary component of the offence. In the absence of mens rea, resort to penal provision would not be proper unless it is established that the conduct of the dealer was contumacious or that there was deliberate violation of the statutory provision or wilful disregard thereof. If the registered dealer honestly believes that any particular goods are embraced by the certificate of registration and on that belief makes a representation, he cannot be held guilty of the offence under Section 10(b) of the CST Act, 1956 and no penalty can be imposed under Section 10A of the CST Act, 1956." As per the observation made in t....