Bajaj Hindusthan Sugar Ltd. Vs Commissioner Commercial Tax U.P. Lucknow And Anr. (Allahabad High Court)
Allahabad High Court held that imposition of penalty under section 10(d) of the Central Sales Tax Act [CST Act] in absence of mens rea is untenable in law. Accordingly, order of penalty is liable to be quashed.
Facts- The petitioner with an intent to set up a manufacturing facility in the State of U.P. were procuring various materials and keeping cement for construction of the premises and during the course of such construction used the cement after procuring the same within the State and outside the State in respect of part of the cement procured by the revisionist from outside the State, the petitioner claimed the benefit under Form C.
AO by means of an order dated 12.11.2012 held that as the assessee was consumed the cement for installation of plant and machinery, he was not entitled to get the benefit of Form C. While passing the said order, although the certificate issued by the Chartered Engineer was taken into consideration, however, the Deputy Commissioner held that total cement bags purchased were 1339650 and as there was no separate register maintained for consumption of the said cement for construction of the foundation and the balance for other purposes, it was presumed that 54.21% of the total cement purchased would be presumed to be used for foundational purposes and for the balance amount, penalty of Rs.8241985/- was imposed against the revisionist for the Financial Year 2005-06. The said order was challenged before the tribunal, however, the tribunal dismissed the appeals preferred by revisionist and upheld the penalty order.
