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2018 (11) TMI 808 - HC - VAT and Sales TaxImposition of penalty u/s 10-A of the Central Sales Tax Act, 1956 - purchase of M-Seal against Form-C - Held that:- The penalty is imposable for deliberate defiance of law or upon guilty or contumacious or dishonest conduct. Also, the burden to establish such fact rests on the revenue. Further all types of omissions or commissions in the use of Form-C may not be embraced in the expression "false representation". Though assessee admits that it may not even be entitled to purchase the commodity MSeal against Form-C, at the same time, there is no material or finding recorded by the revenue authority to establish that it had made a false declaration, while issuing such Form-C. The revenue authority also did not dispute the fact that commodity of M-Seal is popularly sold at hardware stores - The reasoning of the Tribunal that the assessee should have always taken care while issuing Form-C and because such care was not taken, therefore, its conduct was not bonafide is too difficult to accept inasmuch as in the first place the test of care required to be taken care cannot be defined for the purpose of application in all cases involving wrong use of Form-C. Even if it is established that due care may not have been taken, it would not lead to an automatic or logical conclusion of false declaration or malafide intention. The test to be applied being one of false declaration, absence of care to some extent may not therefore, be relevant. Decided in favour of the assessee and against the revenue - petition allowed.
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