IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL Trade Tax Revision No. 10 of 2008 Commissioner Trade Tax/Commercial Tax …Revisionist Versus M/s Ballarpur Industries Ltd. …Respondent With Trade Tax Revision No. 25 of 2008 Commissioner Trade Tax/Commercial Tax …Revisionist Versus M/s Ballarpur Industries Ltd. …Respondent Hon’ble Tarun Agarwala, ACJ. Hon’ble U.C. Dhyani, J. Heard Sri K.P. Upadhyaya, the learned Addl. C.S.C. for the State/revisionist and Sri Mohit Maulekhi, the learned counsel for the respondent- assessee. These two revisions involve the same question of law and are being decided together. For facility, the facts of TTR No. 10 of 2008 is being taken into consideration. This revision is against the proceedings for the Assessment Year 1993-94 initiated under Section 10A of the Central Sales Tax Act. It transpires that for the Assessment Year 1993-94 under the U.P. Sales Tax Act, the Assessing Authority noticed that the assessee had purchased shrink wrapping film under Form C paying concessional rate of tax, whereas the registration certificate issued under Section 7 of the Central Sales Tax Act did not indicate shrink wrapping film. On this basis, proceedings for imposing penalty under Section 10A of the Central Sales Tax Act was initiated. The Assistant Commissioner found that the items mentioned in the registration certificate only indicate plastic packing, whereas the assessee 2 was using shrink wrapping film and consequently, held that the assessee had wrongly used Form C in purchasing shrink wrapping film at concessional rate of tax and consequently, imposed penalty. The Authority held that shrink wrapping film was different from plastic packing. The assessee, being aggrieved by the said order, preferred an appeal which was dismissed, against which the assessee preferred a Second Appeal under Section 10(2) of the Act before the Tribunal. The Tribunal, by its order dated 8th May, 2007, allowed the appeal and quashed the order of penalty imposed by the Assessing Authority as well as affirmed by the Appellate Authority. The Department, being aggrieved by the said order of the Tribunal, has filed the present revision, which was admitted on the following substantial questions of law, namely: (a) Whether the learned Tribunal is justified in quashing the order of First Appellate Court passed by the Joint Commissioner (Appeal), Commercial Tax-II, Uttarakhand at Dehradun dated 22.08.2006 in First Appeal No. 101 of 2001 and order of Assessment Officer (Assistant Commissioner), Trade Tax, Rishikesh by which penalty of Rs.6,86,583/- was imposed U/s 10-A of the Central Sale Tax Act? (b) Whether the learned Tribunal is justified in holding that the Shrink Wrapping Films (S.W. Films) is covered under Form-C for import by respondent? Having heard the learned counsel for the parties, the Court finds that the registration certificate given to the assessee under the Central Sales Tax Act indicated a list of packing material which he could 3 purchase at concessional rate of tax. Amongst other items, at serial no. 4 plastic packing and at serial no. 13, wrapper was indicated as the item which the assessee could purchase at concessional rate of tax. The assessee is a manufacturer of glass bottles and is also a wholesaler in refined oil, vanaspati ghee, paper, soap etc. The assessee is using different kind of packing material as per the requirement specification of the buyer for packing the finished product, namely, the glass bottle. Shrink Wrapping Film is also a plastic packing and, in any case, would come under the term ‘wrapper’. Shrink film is a protective wrapping for articles of merchandise. It consists of clear plastic film that is wound about the articles and then shrunk by heat to form a sealed, tight-fitting package. This type of packaging is also called Shrink package. According to Concise Oxford English Dictionary (Tenth Edition, Revised), the term ‘wrapper” has been defined as “ a piece of paper or other material used for wrapping something, especially something sold or for sale. Consequently, the Court finds that the term ‘wrapper’ used in the registration certificate has a wide connotation. The Court further finds that the assessee had produced a sample before the Tribunal indicating the Shrink Wrapping Film that was used to wrap the glass bottle which they were manufacturing and, on that basis, the Tribunal found that the product Shrink Wrapping Film was being used as a wrapper. In the light of the aforesaid, the Court is of the opinion that there was no misrepresentation or fraud played by the assessee in purchasing Shrink 4 Wrapping Film under Form-C at concessional rate of tax. The Court also finds that the assessee while purchasing Shrink Wrapping Film had also declared its intention to purchase such item under Form-C before the Tribunal and that was also allowed by the Department by the issuance of Form-C. In the light of the aforesaid, the element of mens rea is lacking. It is settled law that in the absence of mens rea and in the absence of any misrepresentation no penalty can be imposed under Section 10-A of the Act. The Assessing Authority committed a manifest error in imposing penalty and the same was rightly set aside by the Tribunal. In the light of the aforesaid, the Tribunal was justified in setting aside the order of the First Appellate Court passed by the Joint Commissioner (Appeals) as well as the order passed by the Assessing Authority, Commissioner Sales Tax. The Tribunal was also justified in holding that Shrink Wrapping Film was covered under Form-C. In view of the aforesaid, the revisions lack merit and are dismissed. (U.C. Dhyani, J.) (Tarun Agarwala, ACJ) 20-10-2011 Salim/