Judgment

RAY, C. J. (on behalf of himself and Khamla J.) (Majority view):- These appeals raise the question as to whether the assessees under the Central Sales Tax Act, 1956 hereinafter referred to as the Central Act could be made liable for penalty under the provisions of the State Sales Tax Act hereinafter referred to as the State Act. The penalty imposed under the State Act is for default in payment of taxes within the prescribed time.

2. The Central Act states in section 9 (1) that the tax payable by any dealer under the Central Act on sales of goods effected by him in the course of inter-state trade or commerce shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provisions of sub-section (2) in the State from which the movement of goods commenced.

2A. Section 9 (2) of the Central Act is as follows

"Subject to the other provisions of this Act and the Rules made thereunder, the authorities for the time being empowered to assess, re-assess, collect and enforce payment of any tax under the general Sales Tax law of the appropriate State shall, on behalf of the Government of India, assess, re-assess collect and enforce payment of tax, including any penalty payable by a dealer under this Act as if the tax or penalty payable by such a dealer under this Act is a tax or penalty payable under the general Sales Tax law of the State; and for this purpose they may exercise all or any of the powers they have under the general Sales Tax law of the State; and the provisions of such law, including provisions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, imposition of the tax liability of a person carrying on business on the transferee of, or successor to, such business, transfer of liability of any firm or Hindu undivided family to pay tax in the event of the dissolution of such firm or partition of such family, recovery of tax from third parties, appeals, reviews, revisions, references, refunds, rebates, penalties, compounding of offences and treatment of documents furnished by a dealer as confidential, shall apply accordingly;

Provided that if in any State or part thereof there is no general Sales Tax law in force, the Central Government, may, by rules made in this behalf make necessary provision for all or any of the matters specified in this sub-section".

3. Section 6 of the Central Act provides for liability to tax on inter-State Sales. Section 8 of the Central Act provides for rates of tax on Sales in the course of inter State trade or commerce. section 9 of the Central Act provides for collection of tax and penalties.

4. Section 10 of the Central Act provides penalties. The various grounds for penalties are fully enumerated there. Section 10A (1) of the Central Act provides for imposition of penalty in lieu of prosecution,

5. The contention on behalf of the assessee is that there is no provision in the Central Act for imposition of penalty for delay or default in payment of tax, and, therefore, imposition of penalty under the provisions of the State Act for delay or default in payment of tax is illegal.

6. The rival contention on behalf of the Revenue is that the provision for penalty for default in payment of tax as enacted in the State Act is applicable to the payment and collection of the tax under the central Act and is incidental to and part of the process of such payment and collection.

7. The Solicitor-General on behalf of the Revenue placed reliance on the decisions in K. V. Adinaralana Setty v. Commercial Tax Officer, Koar Circle, Kolar (1963) 14 STC 587 (Mys); Commr. of Sales Tax Madhya Pradesh, Indore v. Kantilal Mohanlal and Brothers 19 STC 377 M/s H. M. Esufali H. M. Abdulali v. Commr. of Sales Tax, M.P. Indore 24 STC 1 and Auto Pins (India) v. The State of Haryana 26 STC 466 in support of his contention. .

8. The contentions of the Solicitor General are these: Section 9(1) of the Cent