J.K. Ranka, J. - (1.) Instant petition is directed against the judgment dated March 22, 2002 passed by the Rajasthan Tax Board in Appeal No. 1355/99. Brief facts are that the respondent is a limited company and is carrying on manufacturing and sale thereof of dry cell batteries. On August 26, 1998 when the goods of the respondent -assesses in truck No. RJ19 G 10929 was being transported from its factory situated in Pithampur (M. P.) to its branch on stock transfer in the State of Rajasthan, and when the vehicle was intercepted by the anti -evasion wing of the petitioner, it was noticed that the incharge produced challan No. 4066 and bilty No. 6481 dated August 17, 1998 of the Bombay Roadways, arid inter -office transfer -cum -delivery challan No. LNL(P)/JAI/112 dated August 17, 1998 of M/s. Lakhanpal National Ltd., Pithampur, M. P., and declaration form ST -18A No. 20112/13. It was noticed oh perusal of the declaration form ST -18A that under rule 53 of the RST Rules, 1995, not only the declaration form ST -18A ought to have been carried but it ought to have been filled -in, in all respect and when the declaration form produced by the incharge of the vehicle did not contain material particulars, namely, details of the goods, value of the goods, bill number, challan number, date and other material particulars, it was expressed by the officer that it is virtually not carrying of the declaration form and a show -cause notice was issued as to why penalty be not imposed under Sec. 78(5) of the RST Act, 1994. An explanation was filed on behalf of the assessee that neither the goods were being transported for sale nor a transfer or consignment but was a stock transfer from the factory (head office) to a branch in the State of Rajasthan and, therefore, provisions of rule 53 are inapplicable. However, the assessing officer was not satisfied and imposed a penalty to the tune of Rs. 5,72,561 under Sec. 78(5) of the Act.
(2.) An appeal came to be preferred before the Deputy Commissioner (Appeals) who taking into consideration the submissions of the respondent -assessee found that all other documents were found in order which contained requisite information which were required to be filled in declaration form ST -18A and further that since it was a case of mere stock transfer not involving any tax liability, deleted the penalty. The Revenue carried the matter in appeal before the Rajasthan Tax Board, who also upheld the order of the Deputy Commissioner (Appeals) and thus rejected the contention of the Revenue and held that prior to March 30, 2000, carrying declaration form ST -18A was not required.
(3.) The petition was admitted on the following substantial questions of law: "(i) Whether, on the facts and circumstances of the case, the Rajasthan Tax Board was justified in sustaining the cancellation of the penalty of Rs. 5,72,561 imposed under Sec. 78(5) of the Rajasthan Sales Tax Act, 1994 on the ground that the assessee has no intention to evade the tax? (ii) Whether, on the facts and circumstances of the case, the Rajasthan Tax Board was justified in sustaining the cancellation of the penalty of Rs. 5,72,561 imposed under Sec. 78(5) of the Rajasthan Sales Tax Act, 1994 irrespective of the fact that form No. ST -18A was found not to be completed in material columns at the time of checking of the goods and the mandatory provisions of Sec. 78(2)(a) of the Act of 1994 read with rule 53(1) of the Rajasthan Sales Tax Rules, 1995 have been violated by the assessee? (iii) Whether, on the facts and circumstances of the case, to impose the penalty under Sec. 78(5) of the Rajasthan Sales Tax Act, 1994 read with rule 53(1) of the Rajasthan Sales Tax Rules, 1995, it was necessary to the assessing officer to record the finding of fact that the assessee was intended to evade the tax and to prove the mens rea is an essential ingredient for imposing the penalty -;