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TMI Blog2020 (8) TMI 778X X X X Extracts X X X X X X X X Extracts X X X X ..... onent of the offence. In the absence of mens rea, resort to penal provision would not be proper unless it is established that the conduct of the dealer was contumacious or that there was deliberate violation of the statutory provision or willful disregard thereof - If the registered dealer honestly believes that any particular goods are embraced by the certificate of registration and on that belief makes a representation, he cannot be held guilty of the offence under Section 10(b) of the Act and no penalty can be imposed under Section 10A of the Act. The question whether the assessee acted under the honest belief is a question of fact. The learned Appellate Tribunal was justified in holding that the Assessee was entitled to purchase the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ificate of registration and the fuel, diesel are not included, the assessee was under the bona fide impression that he is entitled to purchase fuel by issue of C forms, since the generator cannot run without the fuel. The purchase of fuel against C forms is found to be integrally part of the manufacturing activity for the goods mentioned in Form B need not be raw materials alone. Rule 13 of CST (Registration and Turnover) Rules, makes it clear, that the processing of materials was included, machinery parts, equipment, tools, stores, spare parts, accessories fuel or lubricants and since the purchases was done only with bona fide intention, the penalty reduced by the Appellate Assistant Commissioner is just and proper and the levy of penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 78,448/- which is disputed in CTA.101/2000 and the appeal stands allowed. For the deletion of ₹ 26,52,112/- by the Appellate Assistant Commissioner (CT) CTSA No.213/2000 is filed and since the appeal is allowed in full, the entire penalty of ₹ 33,30,563 is set aside and the CTSA stands dismissed. 2. Aggrieved over the same, the Revenue has preferred this writ petition before this court. 3. Both the learned counsel fairly submitted that the Full bench of this Court in the case of State of Tamil Nadu vs. Nu-Thread Tyres, 2006(148) STC 256 (Mad) has decided that for imposition of penalty under section 10(b) Read with Section 10-A and the use of words falsely under Section 10C of the CST Act would imply a mens rea on the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble Supreme Court had also considered a similar case and held that the diesel used for running the generator set for carrying on manufacturing process of the yarn was 'raw material' within the meaning of definition clause and therefore, even though it did not form part of the ingredients of finished products, it could be purchased at concessional rates against C forms, and that distinguishing feature of that Judgment is that diesel was included separately as a raw material in the registration certificate of the Assessee. The relevant portion of the Supreme Court judgment is quoted below for ready reference :- Since the diesel was being used for the purpose of running the generator set for the production of the ultima ..... X X X X Extracts X X X X X X X X Extracts X X X X
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