V. K. SINGHAL, J. - (1.) THIS revision petition under section 15 of the Rajasthan Sales Tax Act, 1954, has been filed against the order dated February 18, 1987, of the Rajasthan Sales Tax Tribunal, raising the following two questions of law arising out of its order : (1) Whether, in the facts and circumstances of the case, the Tribunal was justified in setting aside the levy of penalty under section 16 (1) (e) of the Rajasthan Sales Tax Act ? (2) Whether, in the facts and circumstances of the case, the levy of interest under section 11b is justified ? Brief facts of the case are that the assessee, M/s. Baran Co-operative Marketing Society Ltd. is dealing in fertilizers, agricultural implements, etc. In respect of assessment year 1972-73 (July 1, 1971 to June 30, 1972) the assessing authority has found that the assessee had purchased chemical fertilizers from Krya Vikrya Sangh Ltd. and had paid tax to them. In fact the tax was payable in the hands of the assessee and, therefore, out of the total liability, the assessee was subjected to tax on the difference amount (total tax liability minus tax already paid to Rajasthan Krya Vikrya Sangh Ltd. ). The assessing authority came to the conclusion that by showing the transaction as tax-paid in the books of accounts the assessee has committed offence under section 16 (1) (e) of the Rajasthan Sales Tax Act. It was submitted before the assessing authority that the assessee has not charged tax on the said chemical fertilizers and the same has been sold as tax-paid and, therefore, it was under bona fide belief that there was no liability of tax and therefore, penalty was not leviable. The assessing authority has also found that in respect of transaction of agricultural implements, which are exempt the assessee has collected tax, which has not been deposited and, therefore, interest under section 11b is leviable thereon. An appeal was preferred against the assessment order to the Deputy Commissioner (Appeals), Ajmer, wherein levy of penalty was upheld and the matter with regard to quantum of tax collected on agricultural implements and interest levied thereon was remanded back to the assessing authority for fresh determination.
(2.) IN the revision filed by the assessee before the Board of Revenue, it was observed that the contention of the assessee that it has not paid tax under the bona fide belief cannot be accepted and, for the additional tax liability which has been created on agricultural implements, since the matter has already been sent to the assessing authority, therefore, the revision petition was dismissed. In the second appeal before the Rajasthan Sales Tax Tribunal, it was held that there was no mens rea attributable in the facts and circumstances of the case and the levy of penalty was set aside. With regard to liability of interest, the Tribunal came to the conclusion that the winnowers are exempted under section 4 (1) and the amount which was collected, has already been deposited in the exchequer and, therefore, there is no interest liability. I have considered over the matter. For the purpose of levy of penalty under section 16 (1) (e) of the Act, mens rea is the essential ingredient. Simply because explanation which has been submitted by the assessee is not accepted by the assessing authority, this would not give him jurisdiction for levy of penalty. The burden to prove mens rea is on the assessing authority and the penalty was levied by the assessing authority without proving mens rea. The Tribunal has given a clear finding that there is absence of mens rea. Its finding is further supported by the fact that the assessee has not collected any sales tax on the disputed transactions and the explanation appears to be plausible. In these circumstances, I am of the view that the Tribunal was justified in coming to the conclusion that no offence under section 16 (l) (e) has been made out and, therefore, it is not a case where any interference should be made. Regarding liability under section 11b of the Act, I have considered over the matter. The liability of interest could be created if there is valid liability of tax. If there is no liability of tax and if any person has collected any tax under mis-apprehension of law or fact and has deposited in the Government treasury, it cannot be considered to be tax, leviable. Unless tax is levied in accordance with the charging provisions of the section and there is liability for payment of tax, the question of liability of any interest does not arise. On the facts of this case winnowers which are exempted under section 4 (1) of the Rajasthan Sales Tax Act as agricultural commodities are not liable to tax at all and the tax cannot be levied. Even according to the definition under clause 2 (r) "tax" has been defined as tax leviable under the provisions of this Act. Since tax itself was not levied in view of the provisions of section 4 (1) of the Rajasthan Sales Tax Act, the amount which has been deposited could not attract any liability of interest under section 118 of the Rajasthan Sales Tax Act. The view, which the Tribunal has taken is in accordance with law and no interference is called for. The revision petition has no force and is dismissed. No order as to costs. Petition dismissed. .;