COMMISSIONER OF SALES TAX DELHI Vs. RASHMI ELECTRICALS

JUDGEMENT

(1.) THIS is a sales tax reference at the instance of the Commissioner of Sales Tax raising the following question : " Whether, on the facts and in the circumstances of the case, penalty can be imposed under section 11 (3a) of the Act in the event of default in the payment of tax under section 10 of the Act ?"

(2.) THE question arises because of facts which are really to be found in the order of the Financial Commissioner dated 4th January, 1973. Under the scheme of the Bengal Finance (Sales Tax) Act, 1941, which was applicable at the relevant time, a dealer was required to furnish quarterly returns accompanied by a receipt showing payment in a Government treasury or the Reserve Bank of India. A provision was also made 'that the payment of tax could be made by cheque in which case no receipt accompanied the return. In the first quarter of the year 1971-72, the dealer tendered a cheque for Rs. 821. 63 along with his return. On the dishonour of the cheque, a penalty of Rs. 4,000 was imposed which was reduced in appeal to Rs. 3,000. On revision to the Financial Commissioner, it was held that section 11 (3a) did not apply to such cases and, hence, the penalty was quashed. THE order did not give any reasons, but was based on a previous decision of the Financial Commissioner in Revision No. 398 of 1972.