1988 (11) TMI 340 - HC - VAT and Sales Tax

Summary

Issues:
1. Challenge to order of Rajasthan Sales Tax Tribunal regarding penalty imposition under section 16(1)(e) of the Rajasthan Sales Tax Act, 1954.
2. Discrepancy in submission of monthly returns for the assessment year 1984-85.
3. Appeal against penalty imposition before Deputy Commissioner (Appeals-I).
4. Appeal by Revenue before Tribunal leading to restoration of penalty.
5. Dismissal of rectification application.
6. Preliminary objection regarding the availability of alternative remedy and invocation of extraordinary jurisdiction under Article 226 of the Constitution of India.
7. Examination of the Tribunal's finding on concealment of particulars and deliberate inadequate particulars.
8. Decision on quashing the Tribunal's order and restoring the Deputy Commissioner's order regarding the penalty.

Detailed Analysis:
1. The petitioner challenged the order of the Rajasthan Sales Tax Tribunal, which imposed a penalty under section 16(1)(e) of the Rajasthan Sales Tax Act, 1954. The Tribunal allowed the State's appeal against the Deputy Commissioner's decision to quash the penalty. The petitioner submitted correct monthly returns for the assessment year 1984-85 but made an accounting mistake in the submission for July 1984. The Deputy Commissioner (Appeals-I) found no deliberate concealment or intentional wrong returns, setting aside the penalty. However, the Tribunal restored the penalty, leading to the writ petition challenging this decision.

2. The discrepancy arose when the petitioner incorrectly posted sales of taxable tins of edible oil in the ledger as tax-paid. Upon discovering the mistake, the petitioner filed a revised return before a survey conducted by the Commercial Taxes Officer. The Deputy Commissioner found no deliberate concealment and set aside the penalty, emphasizing that the revised returns were filed before the survey. The Tribunal's decision to restore the penalty was based on the non-deposit of tax before the assessment order, which the High Court deemed irrelevant to establish concealment.

3. The Deputy Commissioner's decision was based on the absence of deliberate concealment or intentional submission of inadequate returns by the petitioner. The Tribunal's finding that section 16(1)(e) of the Act applied due to concealment of sales of edible oil tins was considered perverse by the High Court. The Court highlighted the early filing of revised returns before the survey as evidence of no deliberate concealment, contrasting it with precedents where conscious concealment was required for penalty imposition.

4. The High Court addressed the preliminary objection regarding the availability of alternative remedies and the invocation of extraordinary jurisdiction under Article 226 of the Constitution of India. While acknowledging the existence of alternative remedies, the Court emphasized that it may intervene under Article 226 in exceptional cases where findings are perverse or against the law. In this instance, the Court found the Tribunal's decision on concealment to be erroneous and, therefore, justified in quashing the Tribunal's order and restoring the Deputy Commissioner's decision regarding the penalty.

5. In conclusion, the High Court allowed the writ petition, quashed the Tribunal's order, and reinstated the Deputy Commissioner's decision regarding the penalty. The Court emphasized the lack of deliberate concealment by the petitioner and the early correction of the accounting mistake as crucial factors in overturning the Tribunal's ruling.