JUDGMENT

D.K. Jain, J. —

1. These appeals, by special leave, are directed against the judgments and orders delivered by the High Court of Judicature at Allahabad, reversing the orders passed by the Sales Tax Tribunal, Meerut, (for short “the Tribunal”). In the first set of appeals (No. 2344-2347/2004) the Tribunal had affirmed the levy of penalties on the respondent, under Section 10(b) read with Section 10A of the Central Sales Tax Act, 1956 (for short “the Act”) whereas in the second set (appeals No. 6382-6383/2004), the Tribunal had set aside the levy of penalties under the said Section on the appellant. Since the appeals raise a common question of law, it would be convenient to dispose them of by this single judgment.

2. Shorn of unnecessary details, the facts essential for the adjudication of these appeals are:

C.A. Nos. 2344-2347 of 2004

The respondent (hereinafter referred to as “the dealer”) is registered under Section 7(2) of the Act and since the year 1977-78 is engaged in the business of manufacture and sale of Handloom fabrics.

The dealer was authorized to issue Form ‘C’ on the import of cotton and cotton yarn as raw materials. It is not in dispute that the dealer had imp