9911796707
TMI Blog2024 (5) TMI 1428X X X X Extracts X X X X X X X X Extracts X X X X ..... tax. One may rely upon the judgments of this Court in the case of GIRISH AND COMPANY VERSUS STATE OF UP AND 4 OTHERS [ 2024 (1) TMI 1107 - ALLAHABAD HIGH COURT] and M/S. HINDUSTAN HERBAL COSMETICS VERSUS STATE OF U.P. AND 2 OTHERS [ 2024 (1) TMI 282 - ALLAHABAD HIGH COURT] where it has been held that presence of mens rea for evasion of tax is a sine qua non for imposition of penalty. The mere fact that the goods in question were transported at a faster speed does not constitute sufficient grounds for penalization, in light of the departmental circular explicitly excluding transit speed as a criterion for classification. The reliance on speculative assumptions and conjectural reasoning to justify the imposition of penalties is antithetical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmits that the respondent authorities did not undertake the task of calculating the height of the goods which clearly would have indicated that the goods would be classified as the ODC since the same were 13.9 feet above the ground. Counsel on behalf of the petitioner also relied on a circular issued by the Commissioner, State Tax dated January 17, 2024, which states in paragraph 2.4 as follows:- 4. In the above circular, it has also been pointed out that a vehicle other than a double decked transport, the vehicle height of which exceeds 3.8 meters, would be classified as the ODC. 5. Counsel on behalf of the petitioner has submitted that 3.8 meters amounts to 12.46 ft whereas in the case of the petitioner the height of the goods was 13.8 ft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tral Citation No.-2024:AHC:209) where it has been held that presence of mens rea for evasion of tax is a sine qua non for imposition of penalty. 9. The imposition of penalties on the petitioner rests on shaky ground, devoid of any substantive basis or findings indicating an intention to evade tax. This deficiency in evidentiary support undermines the legitimacy of the penalties and raises questions about the procedural fairness of the administrative actions taken against the petitioner. In the absence of concrete evidence demonstrating wilful misconduct or deliberate intent to circumvent tax obligations, the imposition of penalties appears arbitrary and unjustified. 9. The jurisprudential principle that mens rea , or the presence of a guilt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efficacy and reliability of tax enforcement mechanisms. 10. The rationale behind the mens rea requirement is twofold. Firstly, it serves to preserve the integrity of the legal system by distinguishing between inadvertent errors and intentional misconduct. By requiring evidence of wilful intent, it ensures that penalties are reserved for those who deliberately flout the law, thereby safeguarding against unjust punishment and preserving public confidence in the fairness of the tax regime. Secondly, the mens rea requirement acts as a deterrent against tax evasion, signalling to taxpayers that deliberate non-compliance will be met with severe consequences. The prospect of facing penalties serves as a powerful disincentive for individuals and e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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