V. K. SINGHAL, J. - (1.) THIS revision has been filed by the assessing authority under section 15 of the Rajasthan Sales Tax Act, 1954, read with section 9 of the Central Sales Tax Act, 1956, raising the following questions of law arising out of the order of the Sales Tax Tribunal : 1. Whether, in the facts and circumstances of the case, the Tribunal was justified in setting aside the penalty imposed for misuse of "c" form ? 2. Whether, in the facts and circumstances of the case, M/s. Ajmer Zila Dugadh Utpadak Sangh Ltd. , Ajmer, and M/s. Rajasthan Dairy Federation could be said to be identical ? Brief facts of the case are that the assessee purchased the machinery against "c" form for using manufacture of goods for sale. The assessing authority found that in the supervision of National Dairy Development Board, M/s. Rajasthan Co-operative Dairy Federation, Ajmer, is getting the plant erected and after July 1, 1979 the assessee has no concern with the said plant, whereas the purchases have been made during the period July 1, 1979 to June 30, 1981, of which "c" forms have been issued during July 1, 1980 to June 30, 1981 and such purchases amounting to Rs. 2,89,426 have been made for the said plant. Notices were issued under section 10a of the Central Sales Tax Act for contravention of the provisions of section 10 (d) of the Central Sales Tax Act and a penalty of Rs. 18,000 was levied on the transfer of such machinery.
(2.) THE appeal before the Deputy Commissioner (Appeals) was rejected and in the second appeal before the Rajasthan Sales Tax Tribunal, it was found that there was a decision for transfer of machineries by the Government of Rajasthan as a policy matter decision, according to which the ghee was to be manufactured only by the Rajasthan Co-operative Dairy Federation and not by the assessee. THE machineries so purchased against the "c" forms were meant only for manufacture of ghee. THE work of the appellant was restricted only for collecting of milk from the villages. THE Sales Tax Tribunal came to the conclusion that since machineries were utilised for the same purpose for which they have been utilised by the sister concern, the levy of penalty was set aside. The submission of Mr. Bafna on behalf of the assessing authority is that the assessee continued to make purchases after July 1, 1979 when the manufacturing of ghee was closed and the transfer to a different entity is a contravention of the provisions of section 10 (d) of the Central Sales Tax Act. Section 10 (d) of the Central Sales Tax Act provides that if any person after purchasing any goods for any of the purposes specified in clause (b) or clause (c) or clause (d) of sub-section (3) of section 8 fails, without reasonable excuse, to make use of the goods for any such purpose, then he is punishable with simple imprisonment, which may extend to 6 months or fine and with both when the offence is a continuing one. Section 10a of the Central Sales Tax Act provides imposition of penalty in lieu of prosecution to the extent of 1 1/2 times the tax which would have been levied under sub-section (2) of section 8 in respect of the sale to him of the goods, if the sale has been the sale falling within that sub-section. The provisions of section 10 (d) of the Central Sales Tax Act contemplate : (a) purchase of goods; (b) for the purpose specified in clause (b) or (c) or (d) of sub-section (3) of section 8; (c) failure without reasonable cause; and (d) use of the goods for the declared purpose. The analysis of the above section contemplates that the offence can be said to have been committed when there is no reasonable excuse with the assessee. In other words, the mens rea is the necessary ingredient of the offence and no penalty can be levied if there is a bona fide belief based on certain circumstances in which use was made or there is a reasonable excuse. There may be a circumstance where the business has completely been closed and there is a transfer of the material to another concern. There may be like other reasons where it could be said that the assessee has a reasonable excuse. The expression "reasonable" has been defined in the Concise Oxford Dictionary as under : " Reasonable : having sound judgment sensible, moderate, not expecting too much, ready to listen to reason. 2. in accordance with reason, not absurd; within the limits of reason, not greatly less or more than might be expected; inexpensive, not extortionate; tolerable, fair, 3. (arch) endowed with faculty of reason. " From the above definition, the explanation of the assessee, which is based on reason or for any rational according to the dictate of reasons will immune the assessee under the provision. The Rajasthan Sales Tax Tribunal has recorded a finding that the machineries have been put to same use by a sister concern and thus, it impliedly means that there was no mens rea. It was by virtue of the decision taken by the Government not to manufacture ghee in the unit of the assessee and to get it manufactured in the unit of the Rajasthan Co-operative Dairy Federation, then no mens rea can be imputed. As a matter of fact there is no finding given by the assessing authority that there was any mens rea on the part of the assessee. On the basis of the provisions of section 10 (d) of the Central Sales Tax Act and the reasonings of the Sales Tax Tribunal, I am of the view that neither there is any finding of mens rea by the assessing authority nor it has been so proved and the Sales Tax Tribunal found it to be a reasonable excuse. No case for interference is made out.
(3.) IN the result, the revision petition is dismissed. No order as to costs. Petition dismissed. .;