Assistant Commercial Taxes Officer vs Radhey Sales Corporation

Alok Sharma, J.—This sales tax revision petition u/s 86 of the Rajasthan Sales Tax Act, 1994 (hereinafter ''the Act of 1994) impugns the judgment dated 16.08.2007, passed by the Rajasthan Tax Board, Ajmer whereby the Tax Board has upheld the order of the Deputy Commissioner (Appeals) IV, Commercial Tax, Jaipur passed on 18.03.2005 quashing and setting aside the order of penalty on the respondent-assessee passed by the assessing officer under his order dated 18.12.1997.

The facts of the case are that on 13.12.1997, truck No. GJ-9V/1061 was checked at Ajmer Road Chungi Naka, Jaipur by the assessing authority and it was found that albeit the goods were accompanied by other requisite documents u/s 78(2) of the Act of 1994, the declaration form ST-18A in accompaniment was completely blank. Thereupon a show cause notice was issued u/s 78(5) to the respondent-assessee for breach of Section 78(2) of the Act of 1994 and Rule 53/54 of the Rajasthan Sales Tax Rules, 1995 (hereinafter ''the Rules of 1995'') thereunder. The respondent-assessee filed reply to the show-cause notice admitting that the declaration form ST18A was blank. The assessing officer vide his order dated 18.12.1997 levied a penalty on the goods in transit @ 20% of their value to the tune of Rs. 53,100/- with reference to Section 78(5) of the Act of 1978.

The respondent-assessee filed an appeal before the Deputy Commissioner (Appeals) IV, Commercial Tax, Jaipur against the order dated 18.12.1997, passed by the assessing officer. Vide order dated 18.03.2005, the Deputy Commissioner (Appeals) IV, set aside the penalty u/s 78(5) of the Act of 1994. The petitioner Department thereupon being dissatisfied with the order passed by the Deputy Commissioner (Appeals) IV on 18.12.1997 filed a further appeal before the Rajasthan Tax Board, Ajmer. The said appeal was dismissed vide order dated 16.08.2007.

Heard Ms. Tanvi Sahai, appearing for the petitioner. None has appeared on behalf of the respondent-assessee in spite of service.

The judgment of the appellate authority and the Rajasthan Tax Board passed on 18.3.2005 and 16.08.2007 respectively are contrary to the judgments of the Hon''ble Apex Court in the cases of State of Rajasthan and Another Vs. M/s D.P. Metals, and Assistant Commercial Taxes Officer Vs. Bajaj Electricals Ltd., In D.P. Matels (Supra), it has been held that a blank declaration form ST-18A was indicative of mens rea to evade tax and a breach of Section 78(2) of the Act of 1994 and corresponding Rule of 1995 enough by itself for levy of penalty on assessee u/s 78(5) of the Act of 1994. Similarly in Bajaj Electrical Ltd. (Supra) the Hon''ble Supreme Court has held that even prior to the amendment of Section 78(5) of the Act of 1994 effective 22.03.2002, the owner of goods was as much liable to penalty as the person in-charge of the goods.

Consequently, this revision petition is allowed. The orders of the appellate authority and the Board of Revenue passed on 18.3.2005 and 16.08.2007 respectively are set aside and that of the Assessing Officer passed on 18.12.1997 is reserved.