TMI Blog1978 (8) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... itted tax for the quarters ending September and December, 1974, within the time prescribed by law. In reply to the said notice the respondent-assessee contended that it had no intention to evade the tax or not to deposit the admitted tax intentionally but since it was not in a position to deposit the admitted tax because of the financial condition and as such no penalty should be imposed. The explanation offered by the assessee was not accepted by the assessing authority and the penalty was imposed. The respondent-assessee preferred appeals against the said imposition of penalty and the amount of penalty was reduced by the first appellate court. The Revenue as well as the assessee feeling aggrieved against the order of the first appellate a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther finding was recorded that there was nothing on record to indicate that the assessee had any mala fide intention. Even the assessing authority and the Assistant Commissioner (Judicial) also did not hold that the assessee acted mala fide in not depositing the admitted tax. The assessee in support of the claim of tight financial position produced various documentary evidence, letters sent from time to time to the sales tax authorities informing about the depression in business stock, realisation of dues from its various customers and pressure of other creditors. Not only this the assessee also gave details of its production and sales in the relevant periods as well as in earlier months and after perusal of the said records it was clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e revisions fail and accordingly dismissed. However, there will be no order as to costs. Petitions dismissed. Appendix [The judgment of C.S.P. SINGH, J., of the Allahabad High Court in Juggilal Kamlapat Cotton Spg. Wvg. Mills Co. Ltd. v. Commissioner of Sales Tax, U.P. (Sales Tax Reference No. 195 of 1976 decided on 11th August, 1978) is printed below: ] JUGGILAL KAMLAPAT COTTON SPG. WVG. MILLS Co. LTD. V. COMMISSIONER OF SALES TAX C.S.P. SINGH, J.-The revising authority has referred the following two questions for opinion of this Court: Question No. 1: Whether on the facts and in the circumstances of the case the fact of non-payment of tax within the time allowed could be considered to be a contumacious or a dishonest condu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... November, 1960. The assessee also filed a writ petition in the Honourable Supreme Court on 12th December, 1960, challenging the imposition of tax at the rate of 1 anna per rupee of the turnover. The Supreme Court on 20th January, 1961, stayed the demand. However, the assessee started making payment in monthly instalments of Rs. 10,000. On the State Government taking the view that no decision on the request of the assessee relating to payment by instalments could be taken till the matter was sub judice before the Supreme Court, the assessee withdrew the writ petition pending in the Supreme Court. Thereafter as no order relating to instalment was passed by the State Government the Sales Tax Officer issued another notice dated 4th October, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been diverted to another sister concern M/s. J.K. Rayon Factory, and this sister concern was paying large amount of sales tax. Assuming that financial difficulty in some cases might be a reasonable cause for not paying tax within time, it cannot provide an adequate ground for remission of penalty in the present case. The reason being that the assessee itself had brought about this situation by diverting the tax realised by it to another sister concern. The assessee having realised tax on the disputed turnover should have kept that amount ready for payment of tax on the validity of the imposition being upheld either by the High Court or Supreme Court, which happened in the present case. It was not reasonable on the part of the assessee for d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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