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TMI Blog1978 (8) TMI 200X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued on the basis of an application dated 6th July, 1961. The petitioner was entitled to purchase paddy, kapas, gur and oilseeds for resale, according to the registration certificate issued under the Central Sales Tax Act, 1956. The Assessing Authority while inspecting the accounts of M/s. Nihal Chand & Sons, Patti, found that the petitioner had effected purchase of timber from time to time during the years 1961-62 to 1966-67 and effected sales thereof in favour of M/s. Nihal Chand & Sons, Patti. The Assessing Authority considering that the petitioner was not entitled to purchase timber on the strength of the registration certificate issued 6 notices under section 10(b) of the Central Sales Tax Act for the years 1961-62 to 1966-67. The Ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dities, all foodgrains, cotton, chillies and the word "etc." did not figure. The Assessing Authority, the Deputy Excise and Taxation Commissioner and the Tribunal came to the conclusion that the dealer had made an untrue statement while purchasing timber on the concessional rate of tax against C forms issued by him. Consequently, they imposed penalty under section 10A of the Central Sales Tax Act. Section 10 relates to penalties and section 10A to imposition of penalty in lieu of prosecution. Section 10(b) provides that if any person, being a registered dealer, falsely represents when purchasing any class of goods that goods of such class are covered by his certificate of registration, he shall be punishable with simple imprisonment which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vered. In Ben Gorm Nilgiri Plantations Company, Coonoor v. Government of Madras[1968] 21 S.T.C. 480. , a similar matter came up before a Division Bench of the Madras High Court. Veeraswami, J, speaking for the Bench, observed as follows: "The phrase 'falsely represents' in section 10(b) of the Central Sales Tax Act, 1956, clearly indicates that the falsity of the representation should be with the knowledge of the representator. If he is under an honest belief that what he represents is true, he cannot be said to make a false representation. The gravamen of the offence is the representation of something as true which, in fact and to the knowledge of the representor, is false." A Division Bench of the Madhya Pradesh High Court in Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edient of the offence and an assessee in its absence cannot be penalised for contravention of the section. In case the assessee has a bona fide belief that the goods are covered by the certificate of registration he may not be liable to punishment. The question whether an assessee had a bona fide belief or represented falsely is one of fact and has to be decided taking into consideration the facts of each case. Keeping the aforesaid ingredients in view, it is now to be seen whether in these cases the assessee was liable to be penalised under section 10A? The learned counsel for the petitioner has vehemently argued that after specifying the goods, the word "etc." had been mentioned by it in the application for registration, but this word ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hows that the department had allowed the petitioner to purchase goods for resale mentioned therein. The other circumstances mentioned by the learned counsel, namely, that the word "timber" appears in the certificate of registration issued under the Punjab General Sales Tax Act, or that purchase and sale of timber are entered in the account books, or that the firm had been taking C forms from the Assessing Authority or that the Assessing Authority had been assessing the petitioner for a long time considering timber to have been purchased in the course of inter-State trade, cannot be said to be grounds for holding that the petitioner bona fide believed that it was entitled to purchase timber during the course of inter-State trade. It cannot t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -State purchases of tin provisions, patent goods, medicine, tobacco, medicated wines, denatured spirits, cigars and cigarettes. The petitioner used C form for purchasing in the course of inter-State trade goods not covered by his certificate of registration, viz., petromaxes, tapes, toilets, battery cells, glassware, essences, etc. The officer held that the petitioner had committed an offence under section 10(b) and therefore imposed on him a penalty under section 10A. The Sales Tax Appellate Tribunal came to the conclusion that the representations made by the petitioner in C forms were false. A reference was made to a Division Bench of the High Court of Mysore under the Central Sales Tax Act. K.S. Hegde, J., as he then was, observed that t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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