TMI Blog2012 (7) TMI 873X X X X Extracts X X X X X X X X Extracts X X X X ..... on of goods. - Prior to the decision in the case of Yasha Overseas V/s. Commissioner of Sales Tax and Others (2008 (5) TMI 43 - SUPREME COURT ) these goods were non-taxable but after the Hon'ble the Apex Court clarified the liability, they have become taxable. Therefore, there was no intention of the assessee to avoid payment of tax deliberately. Appellant was litigating under the bonafide belief that the goods exported were exempted from payment of Sales Tax and for the first time, the goods become taxable after the decision of the Hon'ble the Apex Court in the case of Yasha Overseas V/s. Commissioner of Sales Tax and Others (2008 (5) TMI 43 - SUPREME COURT ) and thereafter, the appellant deposited the tax interest and penalty - penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ? 4. It is not disputed that tax interest and penalty has been deposited by the appellant for the period of three years viz. 2000-01, 2001-02 and 2002-03. The challenge in this tax appeal is about levy of penalty which has already been deposited by the appellant on the ground that there was no intention of the appellant to evade the Sales Tax Act and they were bonafide litigating under the belief that the goods exported by them were exempted from payment of Sales Tax prior to the decision of the Hon'ble the Apex Court in Yasha Overseas V/s. Commissioner of Sales Tax and Others reported in (2008) 8 SCC 681. 5. Learned A.G.P. for the respondent vehemently supported the Order passed by the Tribunal. However, it is not disputed by h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laws and its sale clearly exigible to tax. 60. We may observe here, if DEPB (or for that matter REP license!) has to be compared with a lottery ticket, it can only be compared with a lottery ticket that has won the prize. The prize-winning lottery ticket ceases to be a mere piece of paper having no value itself. It acquires inherent value and becomes itself a thing of value. Imagine a situation where prize winning lottery tickets are freely available for sale. (As a matter of fact, clandestine sale of the prize winning lottery ticket for conversion of black money into white is not completely unknown!). In buying the prize winning lottery ticket the purchaser would pay the consideration for the value that the piece of paper has acquired ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lers' turnover disallowing the exemption, penalty cannot be imposed. The penalty levied stands set aside. 10. Similar view was taken by the Hon'ble the Apex Court in the case of Hindustan Steel Ltd V/s. The State of Orissa reported in 25 STC 211 SC has held as under : Under the Act penalty may be imposed for failure to register as a dealer: s. 9(1) read with s. 25(1)(a) of the Act. But the liability to pay penalty does not arise merely upon proof of default in registering as a dealer. An order imposing penalty for failure to carry out a statutory obligation is the result of a quasicriminal proceeding, and penalty will not ordinarily be imposed unless the party obliged either acted deliberately in defiance of law or was guilt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance of law or is guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. The liability to pay penalty does not arise merely upon proof of default. Penalty will not also be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act or where the breach flows from a bonafide belief that the offender is not l ..... X X X X Extracts X X X X X X X X Extracts X X X X
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