Commissioner of Sales Tax vs Surana Traders

Heard.

This reference u/s 44 of the Madhya Pradesh General Sales Tax Act, 1958 (since repealed) is made at the instance of the Revenue for resolution of the following question :

"Whether under the facts and circumstances of the case, the Tribunal was justified in setting aside the penalty u/s 45-B of the M.P. General Sales Tax Act, 1958 as the assessee was exempted from payment of tax but was not prohibited from collecting the tax from customers."

It is seen that the question involved stands answered by a division Bench decision of this Court in Commissioner of Sales Tax, M.P. v. Akshya Industries [1996] 29 VKN 142 wherein it is held that the assessee is not liable to pay penalty u/s 45-B of the Act even if it has recovered tax from the customers. Accordingly we answer the question in favour of the assessee and against the Revenue.

A copy of this order be transmitted to the Board of Revenue with reference to their reference No. 72-PBR/91 arising from the order dated July 19, 1991 passed by the Tribunal in Second Appeal No. 209-I of 1988.