9911796707
TMI Blog1996 (8) TMI 484X X X X Extracts X X X X X X X X Extracts X X X X ..... that no penalty under section 43(1) can be imposed for filing incorrect returns and without proving mens rea?" 2.. Briefly stated, the facts of the case are that the non-applicant is a manufacturer of cloth and synthetic yarn. During the period October 1, 1983 to September 30, 1984, the non-applicant showed the total purchases in its return. The return was, however, in conflict with the position shown in the books of accounts. Penalty of Rs. 67,000 was imposed under section 43(1) of the Act for filing false return and of Rs. 4,500 under section 17(3) of the Act for late payment of tax and Rs. 100 under rule 69A of the M.P. General Sales Tax Rules, 1959 for non-submission of form VIII. The assessee filed the first appeal which was allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax evaded if the tax evaded is twenty per cent to fifty per cent of the total tax payable by him; or (ii) one hundred per cent of the tax evaded, if the tax evaded is fifty-one per cent to one hundred per cent of the total tax payable by him; or (iii) one hundred and fifty per cent of the tax evaded if the tax evaded is above one hundred per cent of the total tax payable by him." 5. It emerges from the aforesaid provision that the Commissioner or appellate authority is empowered to impose penalty. The word used is "may". This shows that the discretion is conferred. But as stated by Lord Mansfield in classic terms in John Wilkes' case [1770] 4 Burr 2528, the discretion is required to be sound and has to be regulated by law and governe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng officer was not right in levying penalty under section 43(1) of the Act. The Appellate Deputy Commissioner is also not justified in upholding the penalty levied. As a result, the penalty under section 43(1) of the Act is hereby set aside. " 7.. In [1982] 50 STC 36 (MP) (Bhojmal & Sons v. Commissioner of Sales Tax, M.P.), it was held as under: ".............In the circumstances, it cannot be said that the filing of the inaccurate return was accompanied by a guilty mind and therefore, as held by the Supreme Court in Cement Marketing Co. of India Ltd. v. Assistant Commissioner of Sales Tax, Indore [1980] 45 STC 197 (SC), the imposition of penalty on the assessee under section 43(1) of the Act read with section 9(2) of the Central Act was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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