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TMI Blog1999 (2) TMI 639X X X X Extracts X X X X X X X X Extracts X X X X ..... on 8(3), CST Act. 3.. Therefore at the very outset it is necessary to set out the relevant provisions of the law involved in the controversy in hand. 4. Section 8, CST Act, in so far as relevant reads 8. Rate of tax on sales in the course of inter-State trade or commerce.- (1) Every dealer, who in the course of inter-State trade or commerce (a) sells to the Government any goods; or (b) sells to a registered dealer other than the Government goods of the description referred to in sub-section (3); shall be liable to pay tax under this Act, which shall be four per cent of his turnover. .................... (3) The goods referred to in clause (b) of sub-section (1)- .................... (b) are goods of the class or cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... offence is a continuing offence, with a daily fine which may extend to fifty rupees for every day during which the offence continues. 6.. Section 10-A, CST Act, in so far as relevant reads 10-A. Imposition of penalty in lieu of prosecution.-(1) If any person purchasing goods is guilty of an offence under clause (b) or clause (c) or clause (d) of section 10, the authority who granted to him or, as the case may be, is competent to grant to him a certificate of registration under this Act may, after giving him a reasonable opportunity of being heard, by order in writing, impose upon him by way of penalty a sum not exceeding one-and-a-half times the tax which would have been levied under sub-section (2) of section 8 in respect of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e following classes of goods or generates or distributes the following form of power, namely: The dealer s year for the purpose of accounts runs from 1st day of April to the 31st day of March. The dealer has no additional place of business/has additional place(s) of business as stated below: (a) in the State of registratio (b) in other States The dealer keeps warehouses at the following places within the State of registration: (1) Compressor, mask hammer, bit drilling rods tools and accessories of rig machine. This certificate is valid from September 2, 1987 until cancelled. Sd. Dated 19-9-1987 (Notified Authority) (Seal) (N.B.-Emphasis added. Words in italics are entries made in RC by the notified authority.) 8.. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cember 28, 1991 in appeal No. 171/CST/Kotah/91-92 partially accepted the dealer s appeal inasmuch as the penalty was reduced to Rs. 1,21,040 being equal to the tax at the differential rate of 6 per cent. This was upheld by the Rajasthan Sales Tax Tribunal (as the Rajasthan Tax Board, hereinafter referred to as the Board, was then known), by its impugned order dated March 5, 1993. 10.. Hence this application for revision which raises the following questions: (i) Whether, under the facts and circumstances of the present case, the Board was right in upholding the penalty of Rs. 1,21,040? (ii) Whether, under the facts and circumstances of the present case, the penalty could be levied under section 10-A, CST Act when the goods in questio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yed by them). 16.. The RC shows that the goods have been specified in the column meant for specifying goods used in mining. The goods in question would undoubtedly fall into the category of mining equipment. The dealer may have used it on a job work basis to bore or drill wells for water which has been inaccurately described as digging pits. On this basis it cannot be said that the dealer failed to use the goods purchased for none of the purposes specified in clause (b) of sub-section (3) of section 8, CST Act. 17.. The dealer s RC recorded these goods as being of the classes of goods to which section 8(1) and (3), CST Act pertained. The declaration prescribed for purposes of section 8(1) and 8(3) is a declaration in form C . Any deale ..... X X X X Extracts X X X X X X X X Extracts X X X X
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