Sabyasachi Mukharji, J. - (1.) Special leave granted. The appeal is disposed of by the judgment herein.
(2.) The appeal relates to the assessment year 1976-77, period being 1-4-76 to 3-1-77 under the U.P. Sales Tax Act 1948 (hereinafter called the Act). The dealer runs a Roller Flour Mills under the name and style of M/s. Mool Chand Shyam Lal Roller Flour Mills, Agra in which Atta, Maida, Suji, Bran and Refraction are manufactured. For the manufacture of Atta, Maida and Suji the wheat is supplied by the Food Corporation of India and Regional Food Controller under the U.P. Roller Flour Mills (Regulation of Use of Wheat) Order. The sale price of the said wheat products i.e. Atta, Maida, Suji has been fixed by the State Government from time to time under U.P. Roller Flour Mills (Ex-Mill Price Control) Order, 1975 under the notifications issued by the Government. The State Government has further issued the Notification No. ST.4602/29-Wheat-127/175 dated 28th June, 1975 under the U.P. Roller Flour Mills (Ex-Mill Price) Control Order, 1975 fixing the ex-mill price of the sales of wheat products and also authorised the mills in the said notification to realise the proportionate amount of octroi, terminal tax, purchase tax or sales tax, duty or excise duty payable by the mills on the wheat crushed in addition to the fixed ex-mill price. The dealers have realised the amount of the wheat products as fixed by the U.P. Roller Flour Mills (Ex-Mill Price) Control Order, 1975 and have also realised the amount of the wheat sales tax or wheat purchase tax and octroi on the wheat used in the manufacture of wheat products, for the sale of Atta, Maida, Suji, Bran and refraction in accordance with the aforesaid notification. The dealers have further realised the proportionate amount of the wheat purchase tax and wheat sales tax and octroi as consideration of the sale price in addition to the sale price fixed by the State Government on the sales of wheat products. It is the case of the revenue that the amount of wheat sales tax and wheat purchase tax as well as the octroi, paid by the dealers for the purposes of purchases of wheat, which was used for the manufacture of wheat products, has been kept in the separate account in the account books of the dealer. It is further the case of the revenue that the amount of wheat sales tax and wheat purchase tax, which the dealer paid for the purposes of purchase of wheat, was collected by the dealer as part of the sale price of the wheat products. For the assessment year 1976-77 the assessment order was passed on 22nd February, 1979 under Rule 41(7) of the U.P. Sales Tax Rules read with S. 18(3) of the Act for the period from 1-4-76 to 3-1-77 by which the assessing authority while passing the assessment order has accepted the contention of the dealer that the amount of the wheat purchase tax, wheat sales tax and octroi charged separately by the dealer in the cash memo of sale of Atta, Maida and Suji are the part of the turnover and included in the dsiclosed turnover of the dealer. The assessing authority in the regular assessment had treated this wheat purchase tax, wheat sales tax and octroi which were paid by the dealer separately in the cash memos and the wheat products sold by the dealer, as part of the ex-mill price of the wheat product. The assessing authority had imposed the tax on this amount treating it as a part of the turnover of the dealer. But after the completion of the assessment, the Assistant Commissioner, (Assessment) issued a notice under S. 15A(l)(qq) of the Act to show cause as to why penalty should not be imposed in respect of the realisation of wheat purchase tax and wheat sales tax during the aforesaid period. A reply was filed by the dealer to the said notice. The Assistant Commissioner by his order dated 24th February, 1979 imposed a sum of Rs. 25,000/- as penalty under S. 15A(l)(qq). Section 15A(l)(qq) reads as follows: "(qq) realises any amount as sales tax, or purchase tax, where no sales tax or purchase tax is legally payable or in excess of the amount of tax legally payable under this Act; or"
(3.) In the aforesaid circumstances after an inquiry as it may deem necessary the assessing authorities may direct that such dealer shall pay, by way of penalty, in addition to the tax, if any, payable by him mentioned therein. Against the aforesaid order of the Assistant Commissioner. the dealer filed an appeal before the Deputy Commissioner (Appeals). The Deputy Commissioner (Appeals) dismissed the appeal and confirmed the order of imposition of penalty. Against the said order of the Deputy Commissioner (Appeals) the dealer filed a second appeal before the Tribunal. The Tribunal also upheld the order of the lower authorities and dismissed the appeal. Against the judgment and order passed by the Tribunal, the dealer moved the High Court by way of a revision. The High Court allowed the revision.;