SHEIKH AHMED Vs. COMMISSIONER, SALES TAX

JUDGEMENT

(1.) THE only question requiring consideration in this writ petition is whether respondent no. 2 could impose a penalty of more than 10% under section 1 5 (5) of the J&K General Sales Tax Act, 1962.

(2.) IT is not disputed that on 25 -9 -1972 the respondents no. 2 issued a show cause notice to the petitioner seeking them to show cause "why penalty equal to 20% the value of the goods should not be imposed on them over and above the amount of tax which might be recoverable from them." Subsequently respondent no. 2 passed an order imposing penalty of Rs. 5500/... vide order dated 17 -10 -1975 under section 15 (5) of the J&K General Sales Tax Act. The maximum penalty which could be levied could not exceed 10% of the estimated value of the goods found to be stored in violation of the provisions of the Act. The show cause notice asking the petitioner to show cause why penalty of 20% be not imposed therefore, did not have the sanction of section 15 (5) of the Act. The impugned order also imposes a penalty which works out to be more than 10% as permitted by section 15 (5) of the Act.

(3.) SINCE the show cause notice as well as the order passed thereupon by respondent no. 2 contravenes the provisions of Section 15 (5) of the J&K General Sales Tax Act. The same cannot be sustained. The show cause notice dated 25 -9 -1975 and the order imposing penalty dated 17 -10 -1975 are therefore set aside.