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2010 (10) TMI 960 - HC - VAT and Sales TaxPenalty under section 78(5) of the Rajasthan Sales Tax Act, 1994 - Held that - Since the assessee produced the declaration form ST 18C before the assessing officer in response to showcause notice then the Deputy Commissioner (Appeals) was fully justified in setting aside the order of the assessing authority levying penalty under section 78(5) of the Act. In these circumstances, I find that although the order of the Tax Board is liable to be set aside in view of judgment of the honourable apex court in the case of Assistant Commercial Taxes Officer v. Bajaj Electricals Ltd. 2008 (11) TMI 374 - SUPREME COURT OF INDIA , but order of the assessing authority was rightly set aside by the Deputy Commissioner (Appeals), in view of judgment of the honourable apex court in State of Rajasthan v. D.P. Metals 2001 (10) TMI 881 - SUPREME COURT OF INDIA . Consequently, the impugned order of the Tax Board is set aside, but revision of petitioner/Revenue is also dismissed in view of judgment of the honourable apex court in the case of State of Rajasthan v. D.P. Metals supra . The order of Deputy Commissioner (Appeals) to the above extent is upheld.
Issues:
1. Interpretation of section 78(5) of the Rajasthan Sales Tax Act, 1994. 2. Consideration of declaration form ST 18C submission as a defense against penalty. 3. Applicability of previous judgments in similar cases. Analysis: 1. The case involved a dispute regarding the imposition of a penalty under section 78(5) of the Rajasthan Sales Tax Act, 1994. The assessing officer issued a notice to show cause for not accompanying declaration form ST 18C with the goods during checking. The Deputy Commissioner (Appeals) set aside the penalty order based on the grounds that the penalty could not be imposed on the owner of the goods and that the declaration form was later submitted. 2. The Assistant Commercial Taxes Officer appealed to the Rajasthan Tax Board, which dismissed the appeal citing a technicality related to the date of the amendment to section 78(5). The petitioner challenged this decision, arguing that the Tax Board's reasoning was against a previous apex court judgment. The counsel for the assessee contended that the submission of the declaration form along with the reply to the show-cause notice should have been considered by the Tax Board as a valid defense against the penalty. 3. The High Court analyzed the submissions of both parties and found that while the Tax Board erred in its reasoning based on the apex court judgment cited by the petitioner, it failed to consider the crucial aspect of the declaration form submission. Referring to the precedent set in State of Rajasthan v. D.P. Metals, the Court emphasized that principles of natural justice may require providing an opportunity to produce missing documents. As the declaration form was eventually produced before the assessing officer, the Deputy Commissioner (Appeals) was justified in setting aside the penalty order. 4. Ultimately, the High Court set aside the Tax Board's order but dismissed the revision petition of the petitioner/Revenue. The decision was based on the apex court's judgment in State of Rajasthan v. D.P. Metals, which supported the Deputy Commissioner (Appeals)'s decision. The Court upheld the Deputy Commissioner (Appeals)'s order and directed the parties to bear their own costs.
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