Assistant Commercial Taxes Officer, Flying Squad, Bharatpur vs Madhusudan Soap Udyog and Another

Jainendra Kumar Ranka, J.—These revision petitions have been filed by the petitioner-Department being aggrieved by the order of the Tax Board by which the Tax Board, while rejecting the Revenue''s appeal, upheld the order passed by the Deputy Commissioner (Appeals) and thus both the appellate authorities below held that the penalty u/s 78(5) of the Rajasthan Sales Tax Act, 1994 could not be imposed on the respondent-assessee if the declaration form ST-18-A prescribed under rule 53 of the RST Rules read with section 81 of the Act was found blank or not completely filled up, if other supporting bills, vouchers, documents found at the time of checking of the goods like sales book, transport, etc., were found in order. In earlier matters, on same lines the Revenue challenged one such case before the honourable apex court and the honourable apex court in the case of Guljag Industries Vs. Commercial Taxes Officer, and Assistant Commercial Taxes Officer Vs. Bajaj Electricals Ltd., have decided the controversy in favour of the Revenue-petitioner and have given some guidelines in cases like this. According to the counsel for the petitioner, after the judgment rendered in the above two cases by the honourable apex court, in all these cases, since the declaration form was found totally blank or incomplete in all respect or partly filled up, therefore, in the light of the aforesaid two judgments of the honourable apex court, the revision petitions deserve to be allowed because the honourable apex court has come to a conclusion that in cases where declaration form was found blank or incomplete, was not proper and penalty could be levied. However, Mr. Alkesh Sharma, counsel, representing on behalf of one of the respondent-assessee, submitted that this court, after the judgment of the honourable apex court has remanded the matter back to the assessing officer. He placed reliance on the judgment of this court in the case of Commercial Taxes Officer v. Jain Tubes reported in (2011) 30 Tax Update 125 and ACTO v. Hariom Company reported in (2011) 30 Tax Update 285 and submitted that the respondent deserves to be allowed opportunity of fresh hearing in the light of the directions of the honourable apex court. He further submitted that number of cases like this have been remanded back by this court.

The counsel for the petitioner-Department is unable to controvert, the above facts and judgments of this court (supra) by which the matters were remanded. She, however, reiterated that in the light of the judgment of the apex court in Guljag Industries Vs. Commercial Taxes Officer, , the matter may be decided in favour of the Revenue.

I have heard learned counsel for the parties and have gone through the judgments cited at the bar including judgment of the honourable apex court in the case of Guljag Industries Vs. Commercial Taxes Officer, and Assistant Commercial Taxes Officer Vs. Bajaj Electricals Ltd., . There is no denial that principles of natural justice have to be complied with in the penalty proceedings u/s 78(5) of the Act. Even section 78(5) of the Act provides for such opportunity of hearing to be given. Even the honourable apex court in the case of State of Rajasthan and Another Vs. M/s D.P. Metals, supports the contention of the assessee that the principles of natural justice have to be followed.

It may be that a show-cause notice may have been given to the respondent-assessee at the time of penalty proceedings in these cases but a bare perusal of the order passed by the assessing officer reveals that even full contention appears to have not been mentioned by the authority levying penalty. Be that as it may, it is also, equally true that the assessee has succeeded in all these cases before the two appellate authorities and matter at such stage should normally not be restored back. However, since the two judgments, referred to herein above, have decided the issue in favour of the Revenue, therefore, under such circumstances and in the light of the facts stated hereinabove and in the interest of justice, this court is of the opinion that the assessee (respondent) deserves to be given a fresh opportunity of hearing and specific show-cause notice with the nature of defects and deficiencies in complying with the provisions of section 78(2) of the Act and it is only thereafter that the penalty proceedings deserve to be decided afresh by the assessing authority dealing with all the issues raised by the assessee (respondent) and that can be only when fresh show-cause notice is issued to the respondents by complying with the principles of natural justice.

In the light of the above facts and circumstances, these revision petitions are partly allowed. The orders impugned passed by the authorities below namely, the Tax Board and the Deputy Commissioner (Appeal) as well as the assessing authority are quashed and the matter is restored back to the assessing authority for deciding the penalty proceedings afresh and de novo. Since considerable time has already expired, therefore, it is expected that the assessing authority will pass such fresh orders after giving opportunity of hearing to the assessee (respondents) within a period of six months from today. Since in these cases, even notices have not been issued, therefore, a copy of this order be forwarded to the respondent-assessee in individual revision petition. The registry is directed to place copy of this order in all respective files. No order as to costs.