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2022 (7) TMI 712 - HC - VAT and Sales TaxLevy of penalty under Section 10-A of the Central Sales Tax Act, 1956 - existence of mens rea (Guily mind/intent to evade) or not - Whether in absence of finding of mensrea, which is condition precedent for levying penalty under Section 10(b) read with Section 10A of the Central Sales Tax Act? - HELD THAT:- The penalty order cannot be sustained as the essential condition for imposition of penalty under Section 10-A of the Act is issuance of false declaration. In the present case, all that the revenue has been able to establish in the penalty order is - though the applicant was authorized to furnish Form C to purchase Furnace Oil and Light Diesel Oil, it wrongly made purchases of High Speed Diesel Oil by utilizing Form C. Whether the explanation furnished by the assessee to entertain bonafide belief that the goods High Speed Diesel Oil were similar to and, therefore, covered under the list of items appended to its registration certificate has not been considered and no discussion exists as to that - Perusal of the reply furnished by the assessee indicates, plea of bonafide belief had been raised. The merits of that explanation apart, it was incumbent on the assessing authority to consider the same and pass appropriate order especially with respect to allegation of false declaration. Unless that finding had been returned by the assessing authority, it is difficult to sustain the penalty under Section 10-A of the Act. In view of the absence of any finding recorded on the essential issue, the question of law is answered in negative i.e. in favour of the assessee and against the revenue.
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