JUDGMENT : ( 1. ) THIS is an application under Section 44 (2) of the M. P. General Sales Tax Act, 1958. ( 2. ) THE material facts giving rise to this application, briefly, are as follows : The applicant is a dealer under the M. P. General Sales Tax Act; 1958 (hereinafter referred to as the "act") and is engaged in the business of sale of cement. The applicant was assessed to sales tax on its turnover for the period 1st August, 1969 to 31st July, 1970. In the course of its business, the applicant had effected sales to the Railways as also to the Posts and Telegraphs Department charging sales tax at the concessional rate of 3 per cent, under Notification No. 958-655-V-ST dated 28th March, 1969, on the ground that these sales were covered by the said notification and were liable to be taxed at the concessional rate of 3 per cent. The assessing authority by its order dated 19th January, 1976 rejected the claim of the applicant for levy of sales tax at the concessional rate of 3 per cent on the sales effected to the Railways and the Posts and Telegraphs Department. The assessing authority, therefore, levied tax at the full rate on the sales effected to the Railways and P and T Department. The assessing authority also levied a penalty of Rs. 1,00,000 on the applicant under Section 43 of the Sales Tax Act. Aggrieved by the order of assessment, the applicant preferred an appeal before the Deputy Commissioner of Sales Tax, Indore Division. The Deputy Commissioner by his order dated 9th September, 1976, affirmed the order of the assessing authority with regard to levy of sales tax at the full rate on sales effected to the Railways and P and T Department. As regards the levy of penalty, the Deputy Commissioner remanded the case to the assessing authority to reconsider the question of imposition of penalty on the facts and in the circumstances of the case. Pursuant to the order of remand the question of penalty was reconsidered by the assessing authority, which by its order dated 23rd February, 1977, imposed the penalty of Rs. Pursuant to the order of remand the question of penalty was reconsidered by the assessing authority, which by its order dated 23rd February, 1977, imposed the penalty of Rs. 3,00,000 on the applicant under Section 43 (1) of the Sales Tax Act on the ground that by not including the amount of freight in its taxable turnover and by claiming wrong deduction at concessional rates on the sales effected to the Railways and P and T Department, the assessee had knowingly furnished false returns. The applicant thereafter preferred an appeal to the Additional Appellate Deputy Commissioner of Sales Tax, Indore, who by his order dated 30th March, 1981 partly allowed the appeal and reduced the penalty to Rs. 1,56,000. It was held that in view of the decision of the Supreme Court in the case of the assessee for an earlier year, the assessee could be under the bonafide belief that freight did not form part of the sale price and, therefore, the non-inclusion of the freight in the taxable turnover would not amount to deliberate concealment. The penalty was, however, maintained in respect of payment of tax on the sales effected to the Railways and P and T Department. Against the decision of the first appellate authority, the applicant filed a second appeal before the Tribunal. The Tribunal by its order dated 4th January, 1983, held that though there could be some doubt about the applicability of the concessional rate of 3 per cent in respect of the sales to the P and T Department, there was no room for doubt in respect of the sales to the Railways which was undoubtedly engaged in commercial activity. The Board of Revenue, therefore, reduced the penalty from Rs. 1,56,000 to Rs. 1,33,000. The applicant thereupon filed an application before the Board of Revenue under Section 44 (1) of the Sales Tax Act, requesting the Board to refer to this Court the following questions of law: (1) Whether, on facts and in the circumstances of the case, the assessing authority was competent under the law to impose a higher penalty of Rs. 3,00,000 on the applicant under Section 43 (1) of the Madhya Pradesh General Sales Tax Act, 1958, on remand of the case by the Deputy Commissioner in first appeal for passing a fresh order of penalty, than that of the penalty of Rs. 3,00,000 on the applicant under Section 43 (1) of the Madhya Pradesh General Sales Tax Act, 1958, on remand of the case by the Deputy Commissioner in first appeal for passing a fresh order of penalty, than that of the penalty of Rs. 1,00,000 imposed by it on the applicant by its previous order originally passed in the assessment case and also whether the order passed by the assessing authority imposing a penalty of Rs. 3,00,000 on the applicant under Section 43 (1) of the Act was proper and legal ? (2) Whether, on facts and in the circumstances of the case, the Tribunal was right in holding that the applicant had furnished false returns in respect of turnover of sales of Rs. 26,76,785. 00 to the Railways as this turnover did not attract concessional rate of tax during the period from 1st August, 1969 to 31st March, 1970, under the State Government Notification No. 958-655-V-ST dated 28th March, 1969 and also whether the penalty of Rs. 1,33,000 imposed on the applicant under Section 43 (1) of the Madhya Pradesh General Sales Tax Act, 1958 was legal and justified ? The Board held that the question as to whether the assessing authority was competent to increase the amount of penalty from Rs. 1,00,000 to Rs. 3,00,000 was not raised when the second appeal was heard. As regards the other question, the Board held that the finding that the assessee had furnished false returns was a question of fact and not a question of law. The application under Section 44 (1) of the Act submitted by the applicant was dismissed by the Board. Hence, the assessee has submitted this application. ( 3. ) HAVING heard the learned counsel for the assessee and for the department, we have come to the conclusion that the question as to the competency of the assessing authority to increase the amount of penalty was not raised before the Tribunal, as observed by the Tribunal in para 3 of its order. It is well-settled that a question of law not raised before the Tribunal and not dealt with by it in its order cannot be said to arise out of its order even if on the facts of the case stated in the order, the question fairly arises. It is well-settled that a question of law not raised before the Tribunal and not dealt with by it in its order cannot be said to arise out of its order even if on the facts of the case stated in the order, the question fairly arises. The other question raised by the applicant is a question of law and it does arise out of the order passed by the Board of Revenue. We, therefore, partly allow the application and direct the Board of Revenue to state the case and refer the following question of law for the opinion of this Court: Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the applicant had furnished false returns in respect of turnover of sales of Rs. 26,76,785 to the Railways and whether the imposition of penalty of Rs. 1,33,000 on the applicant was legal and justified ? ( 4. ) IN the circumstances of the case, parties shall bear their own costs of this application.