JUDGMENT

Swatanter Kumar, J. —

1.M/s. Malayala Manorama Co. Ltd., Kottayam, purchased printing ink for Rs. 1,00,03,050/- from M/s. Quality Ink Manufacturing, Kottayam during the year 2001-2002. The ink so purchased was to be used for printing newspapers by the said firm. This firm filed Form No. 18 under the Kerala General Sales Tax Act, 1963 (for short ‘the Act’) for purchase of raw material for use in the manufacture of ‘finished goods’ i.e. newspaper and in terms of Section 5 (3) of the Act they were liable to pay only concessional tax at the rate of 3% for that period.

2.There was no dispute at any point of time that this concern was engaged in printing of newspapers. However, the Department felt that no manufacturing was involved in the process of printing of newspapers and, as such, purchase of printing ink effected by issuing Form No. 18 was not the correct statement in terms of the statutory provisions of the Act. The case of the Department was that the declarations thus furnished by the firm were not accurate, according to law and there was misuse of statutory forms. This resulted in issuance of a notice for imposition of penalty under Section 45 (A) of the Act providing an