Decided on February 02,1967



- (1.)THIS revision application has been presented on behalf of the State against order dated 19. 11. 63 passed by the Dy. Commissioner (Appeal) Jaipur. The facts of the case are that the Assistant Sales Tax Officer imposed a penalty under sec. 16 (l) (g) of Rs. 50/- for non-submission of declaration in respect of purchase of 50 bags of dhania. The assessee firm went in appeal before the Dy. Commissioner (Appeals) who accepted the appeal and set aside the penalty of Rs. 50/-imposed by the A. S. T. O. Aggrieved by this order the State have come in revision.
(2.)I have heard counsel for the parties and also perused the record. The learned counsel for the State contended that the assessee had given a declaration that the goods were to be resold in Rajasthan and actually these were sent outside Rajasthan and the penalty under sec. 16 (l) (g) was rightly imposed by the Assessing Authority. He further contended that the Dy. Commissioner (Appeals) did not examine whether the present case is covered by the rule laid down in Tulsiram Pannalal vs. State. The assessee had quoted Registration Certificate number to escape from the liability of tax and thus had wilfully acted in contravention of the rules. In support of his contention he cited S. T. C. 1966 p. 235.
The counsel for the opposite party argued that the goods were purchased on 26th January, 1959 and at that time there were no rules in force prescribing submission of declaration and as such the Dy. Commissioner (Appeals) had rightly held that no penalty should have been imposed. He further contended that the Assistant Sales Tax Officer has arrived at his conclusion on mere presumption and surmises that the assessee had given Registration Certificate. He had not made enquiries in this behalf and there is no material on record to support his finding. Referring to the ruling of Supreme Court in Orissa case the learned counsel contended that in that case there was a clear intention of reselling in Orissa and that the rule laid down therein supports the case of his clients as it has been held therein that no liability accrues without any provision in law. The learned counsel produced a certified copy of judgment in Writ No. 183/63 Sardar Sarmukh Singh vs. State of Rajasthan decided by the High Court of Rajasthan on 11th August, 1966 and contended that in the above judgment relying on the case Tulsiram Pannalal vs. State of Rajasthan the learned Judges have held that no penalties under sec. 16 of the Act could be realised retrospectively. I find that the original sec. 2 (g) sub-cl. (iv) runs as under - "which are taxable at the last point and have been sold to registered dealers for the purposes of resale within the State. "

The sub-sec. 2 (s) (iv) was substituted by Rajasthan Act 13 of 1964 the words "for the purpose of resale within the State" were added on 31. 3. 59. Similarly the rule prescribing condition of furnishing declaration was laid down on 1. 10. 60. It is clear that at the time when the purchases were made there was no condition laid down for submission of declaration. The Rajasthan Sales Tax Act came into force on 1st April, 1955 but the rules were made effective from 28th March, 1955 from the date of their publication in Rajasthan Gazette. In order to validate the rules which were published even before the coming into force of Act the Government introduced Rajasthan Sales Tax Rules Validating Act, 1959 (Act No. 43 of 1959) which came into force on 17. 12. 59 by which the Rules were validated retrospectively with effect from 1st April, 1955. Thus it was made clear that the sales tax could be recovered retrospectively.

Regarding imposition of penalties under sec. 16 of the Act a clear rule has been laid down in Tulsiram Pannalal vs. State of Rajasthan which has been confirmed in Sardar Sarmukh Singh vs. State of Rajasthan (Writ No. 182 of 1963, decided on 11th August, 1966 ). The relevant portion is reproduced below- "but the question still arose whether the penalties impossible under sec. 16 of the Act could be imposed for failure to comply with the provision of the Act, equally retrospective that is in cases which arose prior to the enforcement of the Rules Validating Act in 1959. This question has been answered in the negative by a number of decisions of this Court out of which we have considered it sufficient to refer to Tulsiram's case (supra)1'

As already discussed the purchases in the present case and sale outside Rajasthan were made prior to the enforcement of the Rules Validating Act of 1959 and as such in view of the above rule laid down by the High Court the Dy. Commissioner (Appeals) was justified in setting aside the order or penalty imposed by the Assessing Authority under sec. 16 (l) (g ). In the result the revision fails. .

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