By C. B. Thakar Advocate, G. G. Goyal, Janak Vaghani Chartered Accountants
fiogf49gjkf0d
Central Sales Tax – Penalty- Issue of C Form- Representation That Goods Purchased are Covered by Registration Certificate-No Mensrea- Penalty Not Justified, SS 10(b) and 10A of The Central Sales Tax Act, 1956.
FACTS:
The dealer purchased cable and light fittings against Form C, thereby giving a declaration that the goods purchased are covered by a registration certificate. The department imposed penalty u/s. 10A read with section 10(b) of the CST Act on the ground that the goods were not covered by a registration certificate issued to the dealer. In appeal, filed by the dealer, the Tribunal set aside the order levying penalty. The department filed a revision Petition before the Allahabad High Court against the said order of the Tribunal.
HELD:
In view of provisions of sections 10(b) and 10A of the Central Sales Tax Act, 1956, a penalty can be imposed if the dealer has made a false representation. Where there is a bona fide act of the dealer, being under a bona fide belief that the goods in question are covered by the registration certificate then the provision for imposing penalty u/s. 10(b) does not apply. Thus, no penalty can be imposed. Though, under the registration certificate the dealer was authorised to import ‘consumables’, the items “cables and light fittings” were not specifically mentioned in the registration certificate, still the use of the word “ consumables” in the registration certificate showed that the dealer did not import “cables and light fittings” under any mala fide intentions. Accordingly, the High Court dismissed the revisions petition filed by the department and confirmed the order of the Tribunal knocking off the levy of penalty imposed by the lower authority.
