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IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.8216        OF 2013 (@ SPECIAL LEAVE PETITION (C) NO.4194 OF 2010)  

ASSISTANT COMMERCIAL TAXES OFFICER   APPELLANT(S)

VERSUS

M/S PAREKH ENTERPRISES              RESPONDENT(S)

O R D E R

1. Leave granted.

2. This  appeal  is  directed  against  the  judgment  and  order  

passed by the High Court of Judicature for Rajasthan at Jaipur in  

S.B. Sales Tax Revision Petition No.110 of 2009, dated 01.07.2009.  

By the impugned judgment and order, the High Court has set aside the  

penalty levied by the Assistant Commercial Taxes Officer, Bhiwadi  

(Revenue) in exercise of their powers under Section 78(5) of the  

Rajasthan Sales Tax Act, 1994 (for short 'the Act').  

3. The Assistant Commercial Taxes Officer, Bhiwadi had levied  

penalty in exercise of his powers under Section 78(5) of the Act  

against the owner of the vehicle who was carrying certain goods of  

the assessee. Being aggrieved by the said order, the assessee had  

carried the matter in further appeal before the various authorities  

and the same had culminated into a final order passed by the High  

Court.  The High Court has taken the view that the Revenue could not  

have directed the owner of the vehicle to pay the penalty imposed  

under Section 78(5) of the Act.

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4. Being  aggrieved  by  the  aforesaid  finding  and  the  

conclusion reached by the High Court, the Assistant Commercial Taxes  

Officer, Bhiwadi is before us in this appeal.  The issue raised in  

this appeal is no more res integra in view of the judgment of this  

Court in the case of Assistant Commercial Taxes Officers Vs. Bajaj  

Electricals  Limited,  reported  in  (2009)  1  SCC  308.  In  the  said  

decision, this Court has observed:

“If  one  reads  sub-section  (5)  of  Section  78  in  its  entirety with Rule 53 of the 1995 Rules, it is clear that  penalty was liable to be imposed for importation of any  taxable goods for sale without furnishing a declaration in  Form ST 18A completely filled in all respects.   The duty  to  fill  and  furnish  the  said  Form  is  imposed  on  the  purchasing dealer. Therefore, Section 78(5) as it stood  prior to 22.3.02 imposed penalty if possession or movement  of goods took place inter alia in breach of Section 78(2) (a) on "the person in-charge", which included the owner.  In this connection it may be noted that sub-section (5)  comes after sub-section 4(c) which talks about release of  the goods to "the owner of the goods" on his giving of  adequate security. It is the owner (importer) who has to  fill in the Form ST 18A. It is the owner who is entitled  to seek release under Section 78(4) on giving security. It  is  the  owner  who  is  entitled  to  hearing  under  Section  78(5) and, therefore, the expression "person in-charge of  the goods" under Section 78(5) would include the owner.  Moreover, under Section 78(2) the words used are "person  in-charge of a vehicle or carrier of goods in movement"  whereas the words in Section 78(5) which comes after sub- section (4) refers to "person in-charge of the goods". The  words "in movement" do not find place in Section 78(5) and  therefore the expression "person in charge of goods" under  Section 78(5) was wider than the expression "person in  charge  of  goods  in  movement"  under  Section  78(2)(a).  Consequently,  the  expression  "person  in-charge  of  the  goods" under Section 78(5) who is given an opportunity of  being heard in the enquiry would include the "owner of the  goods".

  Therefore,  in  our  view,  the  judgment  of  this  Court in the case of    M/s.Guljag Industries (supra)  would squarely apply to the facts of the present case. In  fact,  our  view  in  the  case  of  M/s.  Guljag  Industries  (supra) finds support from the amendment made in Section

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78(5) vide Act No.7 of 2002 w.e.f. 22.3.2002 by which the  expression "person in-charge of the goods" under the old  Section 78(5) is substituted by the words "the owner of  the goods or a person authorized in writing by such owner  or  person  in-charge  of  the  goods".  It  is  once  again  emphasized  that  Act  No.7  of  2002  is  an  exercise  in  substitution.    Therefore,  the  Legislature  seeks  to  clarify  the  expression  "person  in-charge  of  the  goods"  occurring in Section 78(5) as it stood earlier by Act No.7  of 2002. In fact, it is interesting to note that even  under Section 22A(3) of the 1954 Act, penalty was leviable  on the "owner of the goods" for possession of goods not  covered by the Goods Vehicle Record [including Declaration  under Section 22A(3)].”

5. In  view  of  the  aforesaid  decision  of  this  Court,  the  

judgment and order passed by the High Court cannot be sustained and  

deserves to be set aside.  

6. Therefore,  we  allow  this  appeal,  set  aside  the  order  

passed  by  the  High  Court  and  restore  the  order  passed  by  the  

Assistant Commercial Taxes Officer, Bhiwadi.

Ordered accordingly.  

.......................J. (H. L. DATTU)

.......................J. (M. Y. EQBAL)

NEW DELHI; SEPTEMBER 13, 2013