M-.S. GULJAG INDUSTRIES v. COMMERCIAL TAXES OFFICER

Citation: [2007] 8 S.C.R. 793

Court: Supreme Court of India

Bench: S.H. KAPADIA, B. SUDERSHAN REDDY

Case summary

M-.S. GULJAG INDUSTRIES v. COMMERCIAL TAXES OFFICER.pdf

Judgment text

f. MIS. GULJAG INDUSTRIES v. COMMERCIAL TAXES OFFICER AUGUST 3, 2007 [S. H. KAPADIA AND B. SUDERSHAN REDDY, Jl] Sales Tax: Rajasthan Sales Tax Act, 1994-s. 78(5), (2)-Rajasthan Sales Tax Rules, 1995-Rule 53~Goods in movement carried with incomplete/blank declaration Form ST 18A though signed by the conslgnee~Penalty under s. 78(5)-Held: Rightly imposed~ince entire forin was left blank, declaration by consignee was meaningless-Penalty for tax delinquency is civil obligation, and is different. from penalty for a crime hence existence ofmens rea is not essentialfor imposition-Rajasthan Sales Tax Act, 1954-s. 22A(7)-Rajasthan Sales Tax Rules, 1955. Rajasthan Sales Tax Act, 1994-s. 78(5)-0bject of~tated Rajasthan Sales Tax Act, 1954-s. 22A(7)-Rajasthan Sales Tax Rules, 1955-Rule 62A-Requisite documents not accompanying goods in movement-Imposition ofpenalty-Held: Question as to whether penalty is imposable or not to be decided in the light of decision in D. P.

Metals*- Matter remitted to Commissioner (appeals)-Rajasthan Sales Tax Act, 1994s. 78(5), (2)-Rajasthan Sales Tax Rules, 1995-Rule 53. In the first batch of appeals filed by assessees, the dispute was that on checking of the vehicles at the check post, completely blank Form ST ISA were found with the goods in movement though they were signed by the · consignee. The asses. sing officer held that this indicated an intention of · assessee to evade the tax and herice attracted penalty under s. 78(5) of Rajasthan Sales Tax Act, 1994 (s. 22A(7) ofRajasthan Sales Tax Act, 1954). The Appellate Authority upheld the order of assessing officer. Tax Board allowed the appeal ofassessee holding that penalty could not be imposed without establishing guilty mind (mens rea) on the part ofassessee. Aggrieved by the decision of Board, Department filed revision before the High Court wherein it was held that presence ofmens rea was not a sine qua non for levying penalty in case of contravention ofs.

78(2) of the Act. Aggrieved assessee filed these appeals. In another batch ofappeals filed by department, the dispute was that on verification of the vehicles, the goods were found to be more than the quantity shown in the bill. The driver of the vehicle did not produce the documents at the time of checking and therefore assessee was held liable to penalty for breach of Rule 62A of RST Rules, 1955. Appellate authority held that nonproduction of the bill at the check post indicated guilty mind to evade tax. However, Tribunal was of the view that penalty was automatic once the driver on demand failed to produce the documents accompanied with the goods under s. 22A(3) of RST Act, 1954. Assessee challenged the decision of Tribunal before the High Court. High Court held that levy of penalty was not automatic in case where goods in movement were found to be unaccompanied by requisite documents. Aggrieved department filed appeal. s before this Court.

Disposing of the appeals of assessees and department, the Court rJ HELD: 1. Existence of mens rea is an essential ingredient ofan offence. However, it is a rule ofconstruction. Ifthere is a conflict between the common law and the statute law, one has to construe a statute in conformity with the common law. However, if it is plain from the statute that it intends to alter the course of the common law, then that plain meaning should be accepted. Existence of mens rea is an essential ingredient in every offence; but that presumption is liable to be displaced either by the words ofthe statute creating the offence or by the subject matter with which it deals. A penalty imposed for a tax delinquency is a civil obligation, remedial and coercive in its nature, and is different from the penalty fot a crime. ! Para 9) (802-B-C] 2. 1. On the face of it, there was contravention of Section 78(2) of the RST Act 1994.

Under Rule 53 of the RST Rules 1995(Rule 25C of the RST Rules 1955) every registered dealer who imports taxable goods, for sale within the State, is required to furnish declaration Form 18A completely filled in, in all respects. Under Rule 53 of the said Rules the counterfoils of the declaration has to be retained by such consignee and its portions marked as 'original' and 'duplicate' have to be carried with the goods in movement. Under the said Rule 53(1)(c) the driver is required to produce the declaration form, suo motu at the check-post at the time ofinspection when the competent officer is requil'ed to retain the original of the declaration form and return the duplicate portion to the driver. The competent officer shall thereafter forward J GUUAG INDUSTRIES v. COMMERCIALTAXES OFFICER 795 the original portion of the declaration to the A. O. of the registered dealer or to the authority which has issued the declaration form to the consignee. {Para 20] (826-G-H; 827-A-CJ 2. 2.

Under Rule 53(2) the registered dealer is required to submit statement ofimport ofgoods in Form ISA to the A. O. every quarter. Under Rule 53(4) where a registered dealer fails to furnish such statement the A. O. or the authority who issued the declaration forms may impose penalty under . Section 68 ofthe said Act. Form 18A, is in two parts. Part-A has to be filled in by the consignee. Part-B has to be filled in by the consignor. The nature of the transaction as to whether it is by consignment or by depot transfer or by ... interstate sale has to be indicated by the consignee. Similarly, the consignee has to indicate the description of the goods. Part-B has to be filled in by the i consignor. Part-B requires the consignor to give the estimated value ofgoods. ' He has also to give invoice number and the date. The declaration form is collected by the consignee from his A. O. in the State of Rajasthan. The consignee gives an undertaking to get Part-B filled by the consignor.

Similarly, the consignee gives a declaration that facts stated in Part-A are true to his knowledge. In the present case, the entire form was left blank though it had been signed by the consignee. Therefore, the declaration given by the consignee is meaningless. There are no facts given in Part-A. There is no identity of the goods transported. There is no description of the goods in movement. [Para 20) [827-C-G) 2. 3. Under Rule 53, the vriginal has to be placed before the A. O. by the officer at the check-post. Ifthe form which ultimately goes to the A. O. is blank in all material respects then it is impossible for the A. O. to assess the dealer and it is this practice which has resulted in loss of revenue in crores to the State. Without description of the goods imported, it is easy to manipulate the value. Ifmaterial particulars are not submitted, one fails to understand how assessment could be finalized.

Moreover, it has become a common practice to circulate the same form again and again resulting in loss of revenue to the State. It is for this reason that Rule 53 of the RST Rules 1995 contemplates the form to be submitted duly filled in and duly completed. Since the goods in movement were not supported by duly filled in Form No. 18A/18C, there was contravention of Section 78(2) of the RST Act 1994. (Para 20] (827-G-H; 827-A-BJ 3. 1. There is dichotomy between contravention ofSection 78(2) of the said Act which invites strict civil liability on the assessee and the evasion of tax. When a statement of import/export is not filed before the A. O. , it results ... I \___ in evasion oftax, however, when the goods in movement are carried without the declaration Form No. 18A/18C then strict liability comes in, in the form ofSection 78(5) ofthe said Act. Breach ofSection 78(2) imposes strict liability ..... under Section 78(5) because goods in movement cannot be carried without Form No.

18A/18C. (Para 21) (828-C-D] 3. 2. The object behind enactment of Section 78(5) is to emphasise loss of revenue and to provide a remedy for such loss. It is not the object of the said Section to punish the offender for having committed an economic offence and to deter him from committing such offem:es. The penalty imposed under the said Section 78(5) is a civil liability. Section 78(2) is a mandatory provision. If the declaration Form 18A/18C does not support the goods in movement because it is left blank then in that event Section 78(5) provides for imposition of monetary penalty for non-compliance. Defaultor failure to t comply with Section 78(2) is the failure/default of statutory civil obligation '= and proceedings under Section 78(5) is neither criminal nor quasi-criminal in nature. The penalty is for statutory offence. Therefore, there is no question of proving of intention or of mens rea as 'the same is excluded from the category of essential element for imposing penalty.

Penalty under Section 78(5) is attracted as soon as there is contravention of statutory obligations. Intention of parties committing such violation is wholly irrelevant. ,,. - ' (Para 21) (828-D-ll) 3. 3.. The modusoperandi adopted by the assessees itself indicates mens rea. This is not the case where goods in movement are carried without the declaration forms. The goods in movement were carried with the declaration forms. These forms were duly signed, however, material particulars were not filled in. The explanation given by the assessees in most of the cases is that they are not responsible for the misdeeds of the consignors. The other explanation given by the assessees is regarding the language. problem. There is no merit in these defences. They are excuses. The declaration forms were ·" unfilled so that they could be used again and again. The forms were collected by the consignee from the said Department.

The consignee undertakes to see that the value of the goods is supplied by the consignor. It is not open to the consignee to keep the column in respect of the description ofgoods as bhmk. · Even the column dealing with nature Of transaction is left blank. The consignee is the buyer of the goods. He knows the descriptions of the go~ds which he is supposed to buy. There is no reason for leaving that column blank. Therefore, . there are no special circumstances in any case for waiver of penalty for >contravention of Section 78(2). The assessees were fully aware that the goods in movement had to be supported by Form ST 18A/18C. Therefore, they made -A _J I GUUAG INDUSTRIESv. COMMERCIALTAXES OFFICER 797 ~ the goods travelled with the forms. However, the said forms are left blank in all material respects. Therefore, A. O. was right in drawing inference of mens ... rea against the assessees. (Para 21) (829-A-E) 3. 4.

Section 78(2) requires the goods in movement to travel with the declaration in Form 18A/18C duly filled in. It is Section 78(2)(a) which has been contravened in the present case by the assessee. s by carrying the goods with blank forms though signed by the consignee. In fact, the assessees resorted to the above modus operandi to hoodwink the competent officer at the check-post. Ifthe form is left incomplete and ifthe description of the goods is not given then it is impossible for the assessing officer to assess the taxable goods. The declaration Form 18A/18C is like a return under the Income-Tax Act, 1961. The Assessing Officer completes the assessment on the basis of Form 18A/18C. Jf that form is left blank in all material respects then it is impossible for the A. O. to arrive at the taxable turnover of the assessee. (Paras 21 and 25) (829-F~G; 832-C-D) Chairman, SEBI v. Shriram Mutual Fund and Anr. , (2006) 5 SCC 361, referred to. ~ 3. 5.

The-Court has to go by the words used in the section to ascertain whether the legislature has excluded the element of mens rea. Jt is the statutory law enacted by\the competent legislature which can exclude the presumption under common law. Section 78(5) excludes the presumption of · mens rea which is normally preva;ling in common law. [Para 231 (831-C) Sodhi Transport Co. & Anr. Etc. Etc. · v. State ofUP. & Anr. Etc. Etc. , (1986) 1SCR939 and State ofRajpsthan and Anr. v. D. P. Metals, (2002) 1 sec 279, held inapplicable. 4. Appeals filed by the State (Department) are those cases where the documents did not accompany the goods in movement, like, the bills ofsale, bills of transport etc. These appeals stand on a different footing. They have nothing to do with incomplete forms travelling along with the goods in movement. These civil appeals filed by the State (Department) shall be decided in the light of the judgment of this Court in D. P. Metals*. !

Para 26) (832-F-Gl "' State ofRajasthan and Anr. v. D. P. Metals* (2002) 1 SCC 279, referred to. ~ L CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5197 of2005. From the Judgment & Order dated 14. I0. 2003 of the High Court of Judicature for Rajasthan at Jodhpur in SB Sales Tax Revision No. I023/2002. WITH Civil Appeal Nos. 5210-5224, 5226-5240, 5243-5250, 5260-5267, 5269, 5255- 5259, 4412, 5283, 5723, 4413-4423, 4425-4426, 4429-4437, 4439-4442, 5252 and 5253 of2005. Civil Appeal Nos. 3419 & 3420 of2007. Civil Appeal Nos. 1927, 2243, 2392, 2393, 2952, 2953, 3195, 5273 of2006 & 1422, 1769, 2291 of2007. Pallav Shishodia, D. N. Mishra, B. D. Sharma, Narottam Vyas, Deep Shikha Bharati, Vikramjeet Sikand, Subhash Chandra Birla, Subrat Birla, Dr. Manish Singhvi, P. V. Yogeswaran, Sunil Kumar Jain, Arvind Kr. Sharma, Naresh Kumar, Praveen Chaturvedi, H. K. Puri, N. Ganpathy, Satyendra Kumar, Gopal ·· Sankaranarayan, Vikas Mehta, Punit Jain, SushiIKumar Jain, Christi Jain, H. D.

Thanvi and Sarad Singhania for the Appearing parties. The Judgment of the Court was delivered by KAPADIA, J. l. Leave granted in special leave petitions. 2. In this batch of civil appeals we are required to consider the scope · of Section 78(5) of the Rajasthan Sales Tax Act, 1994 which is in pari materia to Section 22A (7) of the Rajasthan Sales Tax Act, 1954. 3. For the sake of convenience we may mention the facts in Civil Appeal 7 No. 5197 of 2005 - Mis. Gu/jag Industries v. Commercial Taxes Officer. 4. On 21. 1. 95 near the Bahar Road Check Post a vehicle was checked ·in which 47 barrel ofchemicals were transported from Vishakapattanam. Along . whh the goods, outward gate pass No. 4331 dated 16. 9. 95 of Andhra Petro- Chemicals Ltd. and consignment No. 920 dated 16. 9. 95 of M/s. AVR & Co. were found in which the name of the consignor was shown as M/s. Andhra Petro-Chemicals Ltd. Vishakapattanam and the name of the assessee was mentioned as M/s.

Guljag Industries (assessee - appellant herein). Along with the goods, Form ST I8A No. 236084 was also found in which the goods _J GUUAGINDUSTRIES,. _ COMMERCIALTAXES OFFICER [KAPADIA, J. ] 799 transported was not declared though the same was duly signed. Under the _.... above circumstances the A. O. came to the conclusion that there was a contravention of the provisions of Section 22A(3) of the Rajasthan Sales Tai Act, 1954 (for short, 'RST Act 1954') read with Rule 62A(3) of the Rajasthiln. Sales Tax Rules, 1955 (for short, 'RST Rules 1955'). He accordingly issued notice under Section 22A(7) of. the RST Act 1954 calling upon Mis. Guljag Industries to show cause why penalty was not leviable for violation of. Section 22A(3) of the RST Act 1954. In response to the said notice Mis.. Guljag Industries submitted that there was mistake in filing the declaration . form and, therefore, there was no intention of tax evasion.

It was further submitted that the said declaration Form ST '1 sA (Form No. ISA) was supposed _to be filled in by. the consignor but. due to lack of knowledge of Hindi language the same could not be filled in by the consignor. The AO did not accept the Explanation given by Mis. Guljag Ind. ustries. The AO refused to accept the unfilled forni as a dec. laration. Accordingly, he imposed the penalty under Section 22A(7) of the RST Act 1954. Aggrieved by the decision ofthe AO, Mis. Guljag Industries preferred Appeal No. 771RSTIJUC/ 95-96. By order dated 10. 8. 99, Dy. Commissioner (Appeals) came to the · conclusion that under Rule 25(3) ofRST Rules 1955 the purchasing dealer was required to give the reqqisite declaration in Form ST ISA to the selling dealer. According ·to the appellate authority, the responsibility to fill the form was on Mis. Guljag Industries. That,'Mls. Guljag Industries carried on business from Rajasthan: It was familiar with Hindi ·language.

Therefore, tbe unfilled Form No. ISA cannot be accepted as a declaration. The appeal was accordingly dismissed. Aggrieved by the decision of Dy. Commissioner (Appeals), Mis. Guljag Industries carried the matter in second appeal to Rajasthan Tax Board, Ajmer beii1g Appeal No. 13751991Jodhpur. By that time Rajasthan Sales Tax Act 1994 (for short, 'RST Act 1994')came to replace RST Act 1954. However, Section 7S(5) of RST Act 1994 was in pari niateria to Section 22A(7) of RST Act 1954. By order dated 27. 2. 2002 the Board came to the conclusion that penalty could not be imposed_ without establishiqg guilty mind (mens rea) on the part of Mis. Guljag Industries (assessee). The appeal was allowed. 5. Aggrieved by the decision of the- Board, the Department carried the matter in revision to the RajasthanHigh Court, By order dated 14. 10. 03 the . single Judge held that presence of mens ren was not a siiie qua non for levying penalty io case of contravention of Section 22A(3) or'th~ RST Act.

" 1954 (Section 7S(2) ofthe RST Actl994). By the said order the learned single . Judge held that in the present case Form No. ISA was totally blank though signed by the consignee; that it was the duty of the consignee or his agent -H [2007] 8 S. C. R.. to see that the fonn was returned to the transporter with complete details by the consignor. It was further held that the filling up of the form was the duty . · · of the consignee/importer. The learned single Judge held that ·in the circumstances since the consignee was from Rajasthan and since· the form was unfilled it cannot be said that_ the error was accidental. That, moreover in both the States, namely, Andhra Pradesh (Vishakapattanam) and Rajasthan, there are Hindi-speaking persons. In the circumstances, the learned single Judge held that the fonn was deliberately not filled in which indicated an intention ofthe assessee Mis. Guljag Industries to evade the tax. Accordingly, the order of the Board was set aside.

Aggrieved by the order passed in revision by the single Judge the assessee (M/s. Guljag Industr'ies) has come to this Court by way of Civil Appeal No. 5197 of 2005. 6. In Civil Appeal No. 5240 of2005 -Assistant Commercial Taxes Officer v. Mis. Gu/jag Industries ltd. preferred by the Department the facts are as follows. 7. On 1. 11. 90 at Abu Road Check-Post, a vehicle was checked which was carrying goods. On search the driver furnished GR No. I dated 31. J0. 90 issued by Mis. Delhi Bombay Road Lines. The consignment was shown to be Mis. Sumit--Marbles, Abu Road. There was Bill No. 122 dated 31. 10. 90. That Bill referred to 50. 31 sq. meters of granite priced at Rs. 34,494 and the name of the recipient was shown Mis. Sri Parashwanath Granites. On . verification of the vehicle, the goods were found to be more than the quantity shown in the bill. On searching the vehicle two envelopes were found one of which was of Mis. Sri Parashwanath Granites and other was of Mis. Hindustan Granites.

Being suspicious ofthe evasion oftax, notice under Rule t 54 of RST Rules 1995 was issued on 16. 11. 90. The representative of the assessee appeared. He deposited the disputed penalty amount and goods were released. In reply to the show cause notice given to the assessee proposing levy of penalty under Section 22A(7) of the RST Act 1954, it was submitted by the assessee that he had delivered the relevant documents to the transporter which were found to be in the vehicle at the time of the seizure of the goods and, therefore, the assessee was not Hable to be penalized under the said Section. According to the assessee (M/s. Sri Parashwanath Granites), the driver of the vehicle had made a mistake in not producing the documents •·, which were with him at the time of checking and, therefore, the assessee was t not liable to be penalized for breach of Rule 62A RST Rules 1955. This explanation was not accepted. ' J GULJAG INDUSTRIES\'_ COMMERCIALTAXES OFFICER(KAPADIA, J_J 80} 8.

On appeal, the Dy. Commissioner (Appeals) confirmed the levy of _,. _ _penalty. The appellate authority held that non-production of the Bill at the check-post indicated guilty mind of the assessee to evade tax. On further appeal, the Rajasthan Sales Tax Tribunal vide order dated 31. 3. 93 took the view that mere non-production of document by the driver at the check-post cannot result in levy of penalty. Against the order of the Tribunal, a revision 'B was filed before the single Judge of the High Court, however, on constitution of Rajasthan Taxation Tribunal, It stood transferred. The Tribunal took the view that it was obligatory on the part of tfie consignee or his agent to carry with him the requisite documents and also to produce the documents at the check-post on demand by the officer. The Tribunal took the view that contravention of Section 22A of the RST Act 1954 cannot be obliterated by ~ producing subsequently the documents at_ the time of assessment.

The Tribunal took the view that Rules 62A and 63 of the RST Rules 1955 have no application. The said rules applied at the stage ofassessment Accordingly, the Tribunal held that penalty was automatic once the driver on demand failed to produce the document lying with him or ifhe fails to produce the documents accompanied the goods under Section 22A(3) ofthe RST Act 1954. According to the Tribunal, once the offence is complete subsequent furnishing of the documents even -if bona fide will not relieve the owner of the goods from liability of penalty. This decision of the Tribunal was challenged by Mis. Sri Parashwanath Granites. By judgment dated 2. 6. 2004, the High Court held that the levy of penalty was not automatic in the case where the goods in movement are found to be unaccompanied by the required ·documents.

According to the High Court, the question of levy of penalty would arise only before the goods are delivered to consignee and if it is found that the goods are in movement unaccompanied with documents. On facts the High Court found that if for some reason the driver failed to produce these documents at the check-post which were subsequently produced and which were not -false or forged, it could not be said that there was intention to evade the tax. The High Court held that merely because the driver had not shown the documents given to him by the assessee, could not make the assessee guilty of contravention. Cbnsequently, the High Court held that notwithstanding the failure on the pait of the driver to show the bill accompanying the goods at the time of checking but in fact recovered from its possession later on ruled out the possibility ofthe docur.. ent being subsequently prepared, accordingly, the order imposing penalty Was set aside.

At this stage, we may state that even in this ruling ofthe High Court in the case of Sri Parashwanath Granites,' the High Court has clarified that the case of Sri Parashwanath Granites was , ·not the case of the documents being incorrect. On the contrary, the High Court found that the document, namely, the bill accompanying the goods was correct in all respects and, therefore, there was no tax evasion. Consequently, the order imposing penalty was set aside. This decision ofthe High Court · in Sri Parashwanath Granites has been followed by the High Court in the case of Mis. Guljag Industries. Hence, aggrieved by the said decision, the Department has come to this Court by way of Civil Appeal No. 5240 of 2005. 9. Existence of mens rea is an essential ingredient of an offence. However, it is a rule of construction. If there is a conflict between the common law and the statute law, one has to construe a statute in conformity with the common law.

However, if it is plain from the statue that it intends to alter the course of the common law, then that plain meaning should be accepted. Existence of mens rea is an essential. ingredient in every offence; but that presumption is liable to be displaced either by the words of the I ( statute creating the offence or by the subject matter with which it deals. A l penalty imposed for a tax delinquency is a civil obligation, remedial and coercive in its nature, and is different from the penalty for a crime. 10. Therefore, the short point which arises for determinati_ori in this batch of civil appeals is : whether the above presumption, namely, that mens. rea is an essential ingredient in every offence is displaced by the words of Section 78(5) RST Act 1994. 11. To decide the above question we quote hereinbelow Section 22A of the RST Act 1954 which reads as under: '"22A Establishment ofcheck-post or barrier and inspection ofgoods while in transit.

- (I) If the State Government or the Commissioner considers it necessary that with a view to prevent or check evasion of tax under this Act in any place or places within the State it is necessary so to do, it may; by notification in the Official Gazette, direct the setting up of a check-post or the erection of a barrier or both at such place or places as may be spedfied in the notification; Provided that the Commissioner may not direct the setting up of a check-post or the erection of a barrier. for a "period exceeding six months. (2) At every check-post or barrier set up or erected under-sub-section (I) or at any other place when so required by·any officer empowred f· by the State Government in this behalf, the driver or any other person GUUAGINDUSTRIESl". COMMERCIALTAXESOFFICER[KAPADIA,J.

] 803 in-charge of a vehicle, boat or animal shall stop the same and keep it stationary so long as may reasonably be necessary and allow the officer-in-charge ofthe check-post or barrier or the officer empowered as aforesaid to examine the goods carried in or on such vehicle, boat or a. nimal and inspect all records relating to. the goods carried which . """ - /~ "" ... ,. -. (! :'are in the possession . of such driver or other person incharge, who shall, if so required, give his name and address and the name and address of the owner of the vehicle, boat or anial and also the names and addresses of the consignors and consignees, if any, and in case the consignor or the consignee is a registered dealer, whether in this State or in any other State, the number within the name of the district of issue of the registration certificate, if any, of such consignor or the consignee, as the case may be.

(3) The owner or person in-charge of a vehicle, boat or animal shall carry with him a goods vehicle record, a tripsheet or a log book, as the case may be, and such other document, as may be prescribed in respect of the goods carried in or on the vehicle, boat or animal, as 'the case may be, and produce the same before any officer-in-charge of check-post or barrier or any other officer as may be empowered by Government in· that behalf. The owner or person in-charge of vehicle, boat or animal entering the State limits or leaving the State limits shall also give a declaration containing such particulars as may be prescribed ofthe goods carried in or on the vehicle, boat or animal, as the case may be, before the officer-in-charge of the check-post or barrier or the officer empowered as aforesaid and give one copy of the declaration to such officer, and keep one copy with him.

(4) xxx xxx xxx (5) The officer-in-charge of a check-post or barrier or the officer empowered under sub-section (2) may seize or pass order to retain under sub-section (9). [xxx] any goods which are under transport by a vehicle, boat or animal and are not covered by a goods vehicle record, a trip sheet or log book as te came bay be, and other documents prescribed under sub-sectitn (3) and when the goods vehicle, i,oafor animal. carrying any goods enters or leaves the State limits, Hie declaration referred to in sub-section (3) also. (6) The officer-in-charge of the check-post or barrier or any other officer empowered in that behalf may seize.

or pass order to retain under sub-section (9) any goods (other than exempted goods) which are under transport by a vehicle, boad or animal in respect ofwhich the declaration is false or which are not covered by the documents prescribed under sub-section (3): Provided that before seizing any goods, the officer-in-charge of the check-post or barrier or any other officer empowered in that behalf shall record his reasons for doing so and shall give a receipt for the goods to the person from whose possession or control they are seized. Explanation 1. - For the purpose of this sub-section, "exempted goods" includes goods the sale or purchase of which by dealers in general is exempt from tax without any condition or on the sole condition that an exemption certificate, with or without payment of fee, is obtained or the goods are recorded in the registration certificate of the dealer claiming the exemption. Explanation II.

- For the purpose of this section the goods under · transport means goods which have been handed over to a carrier and complete delivery thereof has not been taken from such carrier. Explanaation-111. - Carrier means any person or agency who undertakes to carry or transport goods from one destination to another. (7)-(a) The officer-in-charge of the check post or barrier or any other Officer not below the rank of an Assistant'Commercial Taxes Officer, empowered in this behalf may, after giving the owner or person incharge of the goods a reasonable opportu,nity of being heard and after holding such further enquiry as he may be deem fit, impose on him for possession of goods not covered by goods vehicle record, and ·r other documents prescribed under sub-section (3) or for submission of false declaration or.

documents; a penalty equal to five times of the rate oftax notified under section 5 of the Act, for such goods or 30% of the value of such goods, as may be determined by such officer [whichever is less]. . , 'I Provided that where the goods are being carried without proper documents as required by sub-section (3) or with any false declaration or statements and the owner or the incharge or the driver of the vehicle, boat, or animal carrying such goods is found in collusion for such carrying of goods, the vehicle, boat or animal shail also be _/ GUUAGINDUSTRIESv. COMMER. CIALTAXESOFFIGER[KAPADIA,J.

] 805 seized by the Officer empowered under sub-section (7), and such officer', after affording an opportunity of being heard to such owner, incharge or driver may impose a penalty [equal to five times ofthe rate of tax notified under section 5 of the Act, for such goods or] (30%] of the value of the goods being carried and shall release the vehicle, boat or animal on the payment of the said penalty, or on furnishing such security in such fonn as prescribed under clause (b) of sub·S. (7): Provided further that when an owner, incharge or driver of "''.! vehicle, boat or animal is found guilty second time of the offence mentioned in the preceding proviso, he shall be liable to a maximum penalty as men. tioned in the preceding proviso and the- vehicle, boat or animal carrying the goods may be kept, seized and detained for period not exceeding 30 days after the date of the payment of the penalty or furnishing of the security.

Provided also that where a transporter is found to be in collusion with a trader to avoid or evade tax during the course of movement of the goods through his vehicle; such vehicle may, after an opportunity of being heard has been afforded be confiscated by the Commercial Taxes Officer of the area in whose jurisdiction the case was detected, with the prior approval in writing of the Deputy Commissioner (Administration) having jurisdiction and in case ofconfiscation ofthe vehicle, no penalty shall be imposed in the preceding first proviso. (b) Such Officer may release a~y or the goods seized under subsection (5) or sub-section (6) on payment of the penalty under clause (a) on furnishing such security in such fonn as may be prescribed for the payment thereof, as he may consider necessary.

(c) such officer may, for sufficient reasons release any of the goods seized as aforesaid even before proceeding under clause (a) or during the course of proceedings under that clause, on furnishing of security of an amount equal to the estimated value of the goods to be released if he considers it necessary so to release the goods. (8) All provisions of this section shall apply mutatis mut - (14), (15), (16), (17), (18), (19) and (20) ofrule 23 shall in so far as may be mutatis mutandis apply to the declaration Form ST ISA. ,_ (6) Where Fonn ST I8A and ST ISAA is out of print or in short supply or otherwise not available in zone, the Commissioner may issue such instructions as he deems proper in view ofthe circumstances of the case. " "54.

Declaration required to be carried with the goods in movement for export out of Rajasthan or in the course of interstate trade or ~ commerce; (I) A registered dealer who dispatches any goods taxable within the state to a place out of the state:- (i) for sale outside the state or (ii) in the course of interstate trade or commerce, as notified by the State Government shall furnish or cause to be furnished a declaration in form ST ISC completely filled in all respect in ink. Such dealer shall retain the counterfoil of the fonn within him and shall produce or cause to be produced the portion marked "original" and "Duplicate" before the lncharge of the exit checkpost/Officer empowered under section ~8, who shall retain the original portion and return the duplicate portion after marking seal in token of having verified It, to the person producing it, and such officer shall send the retained original portion of the Fonn ST ISC to the assessing authority of the dealer.

]\ r (2) The dealer shall submit a statement of export of goods in Fonn ST 188 along with the duplicate portion ofform ST l8C and in case original portion ofFonn 18C has not been retained by any I GUUAGINDUSTRIES v. COMMERCIALTAXES OFFICER[KAPADIA,J. ) 821 officer mentioned in sub-rule (I), it shall also be furnished along with duplicate portion of form ST l8C to his assessing authority every quarter within thirty days from the close of the quarter. Explanation: - Quarter means the period ofthret: months ending on 30th June, 30th September, 31st December and 31st March. (3) Where a dealer fails to furnish the statement as mentioned in sub-rule (2) above, the assessing authority after affording a reasonable opportunity of being heard, may impose penalty under section 68 of the Act.

(4) The provisions of sub-rules (S), (6), (7), (8), (9), (10), (11), (12), (13), (14), (IS), (16), (17), (18), (19) and (20) ofrule 23 shall, in so far as may be mutatis mutandis apply to declaration Forms ST 18C. (S) Where Form ST I8C is out of print or in short supply or otherwise not available in a zone, the Commissioner may issue such instructions as he deems proper in view of the circumstances of the case. (6) After the existing Form ST SB and before Form s:r 6, the following Form ST SC shall be inserted. " 16. We also quote hereinbelow Rule SS(3) ofthe RST Rules 199S which · reads as under: "SS. Delivery ofdocuments and seizure ofgoods.

- (l) & (2) xxx xxx xxx (3) Where, a person-incharge of the goods or the driver, as the case may be, does not possess any document and declaration form in respect ofthe goods in movement, or refuses to deliver the documents and the declaration form, or the documents and the declaration form produced appear to be false or forged, the incharge of the check-post or the officer empowered under rule S2, may get such goods unloaded from the vehicle or the carrier and seize the same and shall issue ·receipt of the goods so seized in form ST 20. " 16A. We also quote hereinbelow Section 68 of the RST Act 1994 which reads as under: "68. Penalty for other violations.

- Where any dealer or a person fails to comply with a direction given by any officer or authority appointed or constituted under this Act or violates any of the provisions of this Act or the rules, for which no specific penalty has been provided elsewhere under the Act or the rules, the assessing authority or any other officer not below the rank ofAssistant Commercial Taxes Officer as authorized by the Commissioner, may direct that such person shall pay by way of penalty a sum not exceeding Rs. 2000/- and in the case of continuing default, a further p. enalty of Rs. 25/- for every day of such continuance. 17. We also quote hereinbelow declara•ion Forms ST J8A and ST 18C which read as under: "! FORM s:r. 18AI (See Rule 53) DECLARATION FOR IMPORTS BY REGISTERED DEALERS. Counterfoil/Duplicate/Original Book No. Serial No. ____ --- Seal of Issuing Authority Name of the Office of issue Date of· issue To, The In-charge Check-post .............

Declared and Certified that the goods, particulars of which are given below, have been imported by me/u. s from outside the State for purposes mentioned in rule 53, and hold myself/ourselves liable for payment of tax as per law to the Government on the sale thereof. r GUUAGINDUSTRIES v. COMMERCIALTAXES OFFICER(KAPADIA, J. ] 823 PART-A (To be filled in by Consignee) (I) Name and complete address of the Consignor (2) (a) Name and complete address of the consignee (b) R. C. No. ofthe consignee under RST Act CST Act ;.. (3) Nature of the transaction:- (a) Consignment; or (b) Depot transfer; or (c) Inter-State sale; or (d) Any other nature I. Description of the goods ---.. ,------ PART-:-B (To be filled in by the consignor or person authorized) I. Price/estimated value of goods in Rs.... ,................. 2. Invoice No. /Challan No. and date. 3. (a} Name and full address of the carrier ("Transport Co. or owner of the vehicle) (b) Registration No. of the· vehicle---.. ,------ 1, .. ,....

~............... Proprietori Partner/ Director/ Karta/ Manager/ Secretary of M/s, hereby declare that the facts stated above in PART-A are true to the best Qfmy knowledge and belief and nothing has been concealed. I also undertake the responsibility to get filled up PART-B from the consignor. Seal of the consignee or of Signature and status. of \ the Dealer with . the person signing the R. S. T. /C. S. T. Nos. declaration. (emphasis supplied by us)" ' . > "COUNTERFOIL ORIGINAL DUPLICATE ! FORM S. T. 18CI (See Rule 54) DECLARATION FORCARRYING GOODS OUTSIDE IBE STATE BY REGISTERED DEALERS Book No. ___ Serial No. ____ Seal of Issuing Authority Name of the Office of issue Date of issue To, The Check-post In-charge, Certified that the goods, particulars of which are given below by me to ...................

(place) outside the State of Rajasthan as a result of interstate sale or for sale outside the State or in the form of branch transfer or by principal to outside agent or vice versa and I hold myself liable for payment of tax as per law: -. I. Name and address of the Consignor 2. Registration No. of the consignor under RST Act and CST Act 3. Name and address of the Consignee with { GUI. JAG INDUSTRIES v. COMMERCIALTAXESOFFICER[KAPADIA,J. ) 825 R. C. No. under ... RST Act CST Act 4. Nature of the transaction:- (a) Inter-State sale (b) Despatch for sale outside the State (d) Any other nature 5. Description of the goods (a) Taxable goods. (d) Tax Paid goods 6. Quantity of the packages/goods 7. Weight of the goods. 8. Value/Estimated value of the goods (in Rs. ) 9. Consignor's invoice/Challan No. and Date 10. (i) Name and full address of the transporter (Transport Company or owner of the vehicle or carrier. ) (ii) Registration No. of the vehicle or carrier. I, .......................

Proprietor/ Partner/ Director/ Karta/Manager/ Secretary hereby declare that the facts stated are true to the best of my knowledge and belief and nothing has been concealed. Seal of the consignor with Signature and status of R. S. T. /C. S. T. the person signing the Registration Nos. declaration. \ Date........................... " 18. Since the RST Act 1954 has been substituted verbatim by the RST Act 1994 we prefer to analyse the RST Act 1994. 19. The said RST Act 1994 came into force on 1st October 1995. Section 3 of the RST Act 1994 states that if the turnover of a dealer exceeds Rs. 50,000/- in case he is an importer and if his turnover exceeds Rs. 1,00,000/ - in other case, he shall be liable to get registration under the Act. Under Section 4, the tax payable by a dealer shall be at . a ~ingle point in the series of sales by successive dealers.

Under Section 6, it is stated that in case of a dealer other than a manufacture or processor whose total accessible purchases in a year does not exceed Rs. I0 lakhs may be allowed by the AO to pay tax on aggregate basis. Section 7 refers to payment of self-assessed tax. Section 12 refers to levy of tax on the turnover at each point of sale by the dealer. Section l 3A deals with levy of turnover tax. Chapter VIII deals with inspection, search, seizure and anti-evasion provisions. Under Section 78(1) the Commissioner has the power to set up check-posts at such place and for such period as may be specified. Section 78(7) requires the driver or person incharge of a vehicle or incharge of the goods to carry with him goods-vehicle record (including challans and bills, despatch memos, bills of sale and prescribed declaration forms.

Under Explanation (iii) it is stipulated that for the purposes of Chapter VIII the goods in movement shall mean the goods which are in possession of the transporter. Under Section 78(5) the competent officer has to give hearing to the owner or his representative and after enquiry the competent officer is empowered to impose on the owner a penalty equal to 30 per cent of the value for movement of goods in contravention pf Section 78(2). 20. The facts enumerated above in Civil Appeal No. 5197 of 2005 is the lead case in which one finds that the goods. in movement were carried with blank declaration forms though signed by the consignee. . The material particulars like quality, weight and description of the goods required to be filled in by the assessee (consignee) were left blank. Therefore, in this batch of civil appeals we are concerned with cases where the goods in movement· were carried with blank Form ST ISA.

In our view, on the face of it there was contravention of Section 78(2) of the RST Act 1994, Under Rule 53 of the RST Rules 1995 (Rule 75C ofthe RST Rules 1955) every registered dealer who imports taxable goods, for sale within the State, is required to furnish declaration Form ISA completely filled in, in all respects (emphasis supplied by us). Under Rule 53 of the said Rules the counterfoils of the declaration has to be retained by such consignee and its portions marked as 'original' and 'duplicate' GUUAGINDUSTRIESl·. COMMERCIALTAXESOFFICER[KAPADJA,J. ] 827 have to be carried with the goods in movement. Under Rule 53(1)(c) the driver 'A of the goods in movement has to carry with him documents specified in Section 7S(2)(a) as also the declaration form prescribed in Section 7S(2)(a).

Under the said Rule 53(1)(c) the driver is required to produce the declaration f9tm, suo motu a~ the check-post at the time of inspection when the competent officer is required to retain the original of the declaration form and return the duplicate portion to the driver. The competent officer shall thereafter forward the original portion of the declaration to the A. O. of the registered dealer or to the authority which has issued the declaration form to the consignee. Under Rule 53(2) the registered dealer is required to submit a statement of import ofgoods in the Form ISA to the A. O. every quarter. Under Rule 53(4) where a registered dealer fails to furnish such statement the A. O.

or the authority who issued the declaration forms may impose penalty under Section 6S of the said Act: Similarly, under Rule 54 ofthe RST Rules 1994, a dealer who despatches any taxable goods to a place outside the State is also required to carry declaration in Form ISC with the goods in movement for export out of Rajasthan or in the course of interstate trade or commerce. The dealer is also required to submit his statement of exports to the A. O. along with his returns which he files quarterly. Form ISA, as quoted above, is in two parts. Part-A has to be filled in by the consignee. Part-8 has to be filled in by the consignor. The nature of the transaction as to whether it is by consignment or by depot transfer or by interstate sale has to be indicated by the consignee. Similarly, the consignee has to indicate the description of the goods. In the present cast'" the consignee (assessee) has left the requisite columns blank. Part-8 has to be filled in by the consignor.

Part-8 requires the consignor to give the estimated value of goods. He has also to give invoke number and the date. It is important to note that the declaration form is collected by the consignee from his A. O. in the State of Rajasthan. The consignee gives an undertaking to get Part-8 filled by the consignor. Similarly, the consignee gives a declaration that facts stated in Part-A are true to his knowledge. In the present case, the entire form was left blank though it had been signed by the consignee. Therefore, the declaration given by the consignee is meaningless. There are no facts given in Part-A. There is no identity of the goods transported. There is no description of the goods in movement. As stated above, the original has to be placed before the A. O. by the officer at the check-post. If the form which ul::mately goes to the A. O. is blank in all material respects then it is impossible for the A. O.

to assess the dealer and it is this practice which has resulted in loss of revenue in crores to the State. Without description of the goods imported, it is easy to manipulate the value. If material particulars are not submitted, one fails to understand how assessment could be finalized. Moreover, as submitted on behalfofthe State it has become a common practice to circulate the same fonn ,,__ again and again resulting in loss of revenue to the State. It is for this reason that Rule 53 of the RST Rules 1995 contemplates the form to be submitted duly filled in and duly completed. In the present case, the goods in movement were not supported by duly filled in Form No. 18A/18C. Therefore, there was contravention of Section 78(2) of the RST Act 1994. 21. There is dichotomy between contravention of Section 78(2) of the said Act which invites strict civil liability on the. assessee and the evasion of tax. When a statement of import/export is not filed before the A. O.

it results in evasion of tax, however, when the goods in movement are carried without the declaration Form No. l 8A/l 8C then strict liability comes in, in the fonn of Section 78(5) of the said Act. Breach of Section 78(2) imposes strict liability under Section 78(5) because as stated above goods in movement cannot be carried without Form No. 18A/18C. We are not concerned with nonfiling of statements before the A. O. We are concerned with the goods in movement being carried without supporting declaration forms. The object behind enactment of Section 78(5) which gives no discretion to the competent authority in the matter of quantum of penalty fixed at 30 per cent of the estimated value is to provide to the State a remedy for the loss of revenue. The object behind enactment of Section 78(5) is to emphasise loss of revenue and to provide a remedy for such loss.

It is not the object of the said Section to punish the offender for having committed an economic offence and to deter him from committing such offences. The penalty imposed under the said Section 78(5) is a civil liability. Willful consignment is not an essential ingredient for attracting the civil liability as in the case of prosecution. Section 78(2) is a mandatory provision. Ifthe declaration Form 18A/18C does not support the goods in movement because it is left blank then in that event Section 78(5) provides for imposition of monetary penalty for non-compliance. Default or failure to comply with Section 78(2) is the failure/default ofstatutory civil obligation and proceedings under Section 78(5) is neither criminal nor quasi-criminal in· nature. The penalty is for statutory offence. Therefore, there is no question of proving of intention or of mens rea as the same is excluded from the category of essential element for imposing penalty.

Penalty under Secti'ln 78(5) is attracted as soon as there is contravention of statutory obligations. Intention of parties committing such violation is wholly irrelevant. Moreover, in the present case, we find that goods in movement carried with Form No. l 8A/l 8C. The modus operandi adopted by the assessees itself indicates mens rea. This is not the case where goods in movement are carried GUUAGINDUSTRIES i-. COMMERCIALTAXES OFFICER [KAPADIA, J. ) 829 without the declaration forms. In the present matter, as stated above, goods in movement were carried with the declaration forms. These forms were duly signed, however, material particulars were not filled in. The explanation given by the assessees in most of the cases is that they are not responsible for the misdeeds of the consignors. The other explanation given by the assessees is regarding the language problem. There is no merit in these defences. They are excuses.

The declaration forms were unfilled so that they could be used again and again. The forms were collected by the consignee from the said Department. The consignee undertakes to see that the value of the goods is supplied by the consignor. It is not open to the consignee to keep the column in respect of the description of goods as blank. Even the column dealing with nature of transaction is left blank. The consignee is the buyer of the goods. He knows the descriptions of the goods which he is supposed to buy. There is no reason for leaving that column blank. Therefore, there are no special circumstances in any case for waiver ofpenalty for contravention of Section 78(2). The assessees were fully aware that the goods in movement had to be supported by Form ST I8A/l 8C. Therefore, they made the goods travelled with the forms. However, the said forms are left blank in all material respects. Therefore, A. O. was right in drawing inference of mens rea against the assessees.

It has been repeatedly argued before us that apart from the declaration forms the assessees possessed documentary evidence like invoice, books of accounts etc. to support the movement of goods and, therefore, it was open to the assessees to show to the competent authority that there was no intention to evade the tax. We find no merit in this argument. Firstly, we are concerned with contravention 01 Section 78(2) which requires the goods in movement to travel with the declaration in Form 18A/18C duly filled in. It is Section 78(2)(a) which has been contravened in the present case by the assessees by carrying the goods with blank forms though signed by the consignee. In fact, the assessees resorted to the above modus operandi to hoodwink the competent officer at the check-post. As stated above, if the form is left incomplete and if the description of the goods is not given then it is impossible for the assessing officer to assess the taxable goods.

Moreover, in the absence of value/price it is not possible for the A. O. to arrive at the taxable turnover as defined under Section 2(42) of the said Act. Therefore, we have emphasized the words "material particulars" in the present case. It is not open to the assessees to conted that in certain cases Of interstate transactions they were not liable in any event for being taxed under the RST \ Act 1994 and, therefore, penalty for contravention of Section 78(2) cannot be Imposed. As stated hereinabove, declaration has to be given in Form I8A/ I8C even in respect of goods in movement under interstate sales. It is for contravention of Section 78(2) that penalty is attracted under Section 78(5): Whether the goods are put in movement under local sales, imports, exports or interstate transactions, they are goods in movement, therefore, they have to be supported by the requisite declaration. It is not open to the assessee to contravene and say that the goods were exempt.

Without disclosing the nature of transaction it cannot be said that the transaction was exempt. In the present case, we are only concerned with the goods in movement not being supported by the requisite declaration. 22. In the case of Chairman, SERI v. Shriram Mutual Fund and Anr. , [2006] 5 SCC 361, this Court found on facts th. at a mutual fund had violated SEBI (Mutual Funds) Regulations, 1996. Under the said Regulations there was a restriction placed on the mutual fund on purchasing or selling shares through any broker associated with the Sponsor of the mutual fund beyond a specified limit. It is in this context that the Division Bench of this Court held that mens rea was not an essential ingredient for contravention of the provisions of a civil act. The breach of a civil obligation which attracts penalty under the Act would immediately attract the levy of penalty irrespective of the fact whether the contravention was made by the defaulter with any guilty intention.

It was further held that unless the language of the provision intends the need to establish mens rea, it is generally sufficient to prove the · default/contravention in complying with the statute. In the . present case also the statute provides for a hearing. However, that hearing is only to find out whether the assessee has contravened Section ·78(2) and not to find out evasion of tax which function is assigned not to the officer at the check-post but to the A. O. in assessment proceedings. In the circumstances, we are of the view that mens rea is not an essential element in the matter of imposition of penalty under Section 78(5). 23. We may mention some of the judgments cited on behalf of the assessees. Section 28~8 of the Uttar Pradesh Sales Tax Act, 1948 came for interpretation before this Court in the case of Sodhi Transport Co. & Anr.. Etc. Etc. v. State of UP. & Anr. Etc. Etc. , [1986] I SCR 939.

In that case the constitutional validity of Section 28-B of the said Act was challenged. It was hel~ by this Court that since Section 28-8 created rebuttable presumption as ! regards the proof of a set of circumstances, the effect of such a provision was to shift the burden of proving to the assessee who was given an opportunity to displace the. ;presumption by leading evidence. This judgment has no f· application because the very words contained in Sedion 28-B required the authorities to raise a rebuttable presumption that the goods must have been GUUAGINDUSTRIES v. COMMERCIALTAXES OFFICER [KAPADIA, J. ] 831 sold in the State if the transit pass was not handed over at the check-post. In the present case, we are not concerned with the transit pass.

In the present case, there are no words in Section 78(5) similar to Section 28-B of the Uttar Pradesh Sales Tax Act, 1948 which states that if the transit pass was not handed over to the officer at the check-post, the Department would be entitled to raise the presumption that the goods in transit were sold in the State. As stated hereinabove, we have to go by the words used in the section to ascertain whether the legislature has excluded the element of mens rea . It is the statutory law enacted by the competent legislature which can exclude the presumption under common law. We hold that Section 78(5) excludes the presumption of mens rea which is normally prevailing in common law. Our reasoning is also based on one more factor, namely, that Section 78(5) provides a remedy for recovery of the loss caused to the State by such contravention. 24. In the present case, the assessees have relied upon the judgment ofthis Court in the case of State ofRajasthan and Anr. v. D. P.

Metals, [2002) I SCC 279 . In that case the facts were as follows. The assessee firm manufactured stainless steel sheets. The assessee was a registered dealer. On 22. 1. 97 a truck was inspected by CTO. The same was found without Form l 8A. A show cause notice was issued to the assessee. After hearing a penalty was levied under Section 78(5) ofthe RST Act 1994. It was held that under·Section 78(5) levy of penalty was on the person incharge of the goods. · It was held that the said penalty was leviable under two circumstances. ·Firstly, if there was non-compliance of Section 78(2)(a) of the said Act, namely, that it was not carrying the documents mentioned in that clause. Secondly, iffalse or forged documents/declaration was submitted then penalty under Section 78(5) was leviable. After analyzing the said Section, this Court . held that in the case of submission of false or forged documents/declaration, the authority was entitled to presume the motive to mislead the authorities.

However, in such cases that presumption was rebuttable by the assessee on . producing. the requisite documents referred to in Section 78(2)(a). That, once the ingredient of Section 78(5) stood established after giving a hearing, there was no discretion with the officer to reduce the amount ofpenalty or to waive the penalty. If by mistake some of the documents were not readily available at the time of checking, principles of natural justice might require opportunity being given to produce the same. It was further held that under Section 78(5) the legislature has fixed the rate of penalty and, therefore, the quantum of penalty could not be waived or reduced. 25. In our view, the aforestated judgment in the case of D. P. Metals .. (supra) has no application to the present case. We are not concerned in the ' present case with false or forged documents/declaration. In the present case the goods . in movement were carried with the blar.

ik declaration Fonn l 8A/I 8C which was duly signed by the assessee. Therefore, as stated above, we hold that the goods in movement were carried without the declaration Fonn l 8A/ 18C. Therefore, Section 78(2)(a) stood attracted. Moreover, in the present case, there were no special circumstances indicated by the assessee as to why the fonns which were duly signed were not filled in. Therefore, in our view the above judgment in the case ofD. P. Metals (supra) has no application to the facts of the present case. As stated, we are concerned with the blank declaration Fonn 18A/18C which has travelled with the goods in movement, though signed, was left deliberately blank. The declaration Fonn 18A/18C is like a return under the Income:.. Tax Act, 1961. The Assessing Officer completes the ·assessment on the basis of Fonn 18A/18C. If that fonn is left biank in all material respects then it is impossible for the A. O. to arrive at the taxable turnover of the assessee.

Therefore, in our view, the judgment of this Court in D. P. Metals (supra) has no application to the present case.. 26. Before concluding, we may mention that in this batch ofcivil appeals we have civil appeals filed by the Department. These civil appeals relate to cases where specified documents did not accompanied the goods in movement. The lead case in that regard is Civil Appeal No. 5240 of 2005 Assistant Commercial Taxes Officer v. Mis. Gu/jag Industries Ltd. filed by the Department. We make it clear that our judgment is basically confined to cases where blank/incomplete Fonn 18A/18C had accompanied the goods in movement. Whatever we have stated above is in the context ofthe incomplete Fonn I8A/l 8C travelling along with the goods in movement. However, Civil Appeal No. 5240 of 2005 and such other civil appeals filed by the State (Department) are those cases where the documents were not accompanied the goods in movement, like, the bills of sale, bills of transport etc.

In Civil Appeal No. 5240 of2005 the facts ofwhich have been reproduced hereinabove, show that the case was confined to documents not·accompanying the goods in movement. Therefore, the said appeals stand on a different footing. They have nothing to do with incomplete forms travelling along with the goods in movement. These civil appeals filed by the State (Department)-shall be decided in the light of the judgment of thi. s Court in D. P. Metals (supra). However, cases where goods in movement were accompanied by Form No. ISA/ 18C without duly signed but incomplete in material particulars like description of goods shall be governed by the law discussed hereinabove by us. 27. For the aforestated reasons, we hold that Section 78(5) of the RST GUUAGINDUSTRIES11. COMMERCIALTAXESOFFICER[KAPADIA,J.

] 833 Act 1994 (Section 22A(7) of the RST Act 1954) is the section enacted to provide remedy for loss ·Of revenue and it is not enacted to punish the offender for committing economic offence and, therefore, mens rea is not an essential ingredient for contravention of Section 78(2) of the RST Act 1994. That, the breach of Section 78(2) would attract the levy of penalty under Section 78(5) in cases where the goods in movement have travelled with an incomplete Form No:l8A/18C. We accordingly uphold the judgment of the High Court ofRajasthan in Sales Tax Revision No. 1023/2002 dated 14. 10. 03 ' (which is annexed as page No. I of the appeal paper book in Civil Appeal No. 5197 o/2005 tiled by Mis. Gu/jag Industries v. Commercial T<rees Officer). 28. In the light of our judgment, we direct the Department to dispose of the cases in accordance with law enunciated by us hereinabove.

Accordingly the matters are remitted back to Commissioner (Appeals) to decide the matter in accordance with law enunciated by us hereinabove. The civil appeals, preferred by the State as well as by the assessees, are accordingly stand disposed of with no order as to costs. D. G. Appeals disposed of.