JUDGMENT : ( 1. ) THIS judgment shall also dispose of the following cases : (i) M. C. C. No. 449 of 1986. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (ii) M. C. C. No. 510 of 1986. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (iii) M. C. C. No. 516 of 1986. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (iv) M. C. C. No. 257 of 1987. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (v) M. C. C. No. 258 of 1987. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (vi) M. C. C. No. 259 of 1987. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (vii) M. C. C. No. 260 of 1987. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (viii) M. C. C. No. 261 of 1987. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (ix) M. C. C. No. 262 of 1987. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. (x) M. C. C. No. 263 of 1987. Food Corporation of India, Bhopal v. Commissioner of Sales Tax, M. P. ( 2. ) M. C. C. Nos. 471 of 1986, 449 of 1986, 510 of 1986 and 516 of 1986 are references under Section 44 (1) of the M. P. General Sales Tax Act, 1958, (in brief, "the Act") at the instance of the assessee for the assessment periods April 1, 1972 to March 31, 1973, April 1, 1974 to March 31, 1975 and April 1, 1980 to March 31, 1981, for assessment of sales tax and for the period April 1, 1980 to March 31, 1981, for assessment of entry tax under the Madhya Pradesh Sthaniya Kshetra Me Mal Ke Pravesh Par Kar Adhiniyam, 1976, (in short, "the Entry Tax Act" ). In all these four cases, the Tribunal has referred the following common question of law for decision of this Court: "whether, in the facts and circumstances of the case, the Tribunal was justified in upholding the imposition of penalty under Section 43 of the Act in all the four cases even though reducing its quantum ?" ( 3. ) THE other M. C. C. Nos. ) THE other M. C. C. Nos. 257 of 1987, 258 of 1987, 259 of 1987, 260 of 1987, 261 of 1987, 262 of 1987 and 263 of 1987, are references under Section 44 (3) of the Act at the instance of the assessee for assessment periods 1977-78 for assessment of sales tax under the State Act ; 1976-77, 1977-78 and 1979-80 for assessment of Central sales tax under the Central Sales Tax Act, 1956, and 1976-77, 1977-78 and 1979-80 for assessment of entry tax under the Entry Tax Act. In pursuance of the directions made by this Court, the Tribunal has referred the following three common questions of law for decision of this Court : " (i) Whether, in the facts and circumstances of the case, the Tribunal was justified in holding that the assessee is liable for payment of penalty under Section 43 of the M. P. General Sales Tax Act, 1958, in State case for the year 1977-78 ? (ii) Whether, in the facts and circumstances of the case, the Tribunal was justified in holding that the assessee is liable for payment of penalty under Section 43 of the M. P. General Sales Tax Act, 1958, read with Section 9 of the Central Sales Tax Act, 1956, in Central cases for the years 1976-77, 1977-78 and 1979-80 ? (iii) Whether, in the facts and circumstances of the case, the Tribunal was justified in holding that the assessee is liable for payment of penalty under Section 43 of the M. P. General Sales Tax Act, 1958, read with Section 13 of Act No. 52 of 1976 in the entry tax cases for the years 1976-77, 1977-78 and 1979-80 ?" ( 4. ) THE assessee, Food Corporation of India in ail the aforesaid cases is an undertaking of the Government of India. It is engaged in the business of food grains. As the assessed tax considerably exceeded the tax returned, the assessee was subjected to penalty under Section 43 of the Act in all the cases. The explanation given by the assessee for the difference between the tax assessed and the tax returned was not at all considered by the Tribunal in any of the appeals giving rise to the aforesaid references. Though the penalties were reduced, the explanation offered by the assessee was not considered by the Tribunal in appeals giving rise to M. C. C. Nos. Though the penalties were reduced, the explanation offered by the assessee was not considered by the Tribunal in appeals giving rise to M. C. C. Nos. 471, 449, 510 and 516 of 1986, by observing that- "one crucial fact which cannot be ignored is that the trend of legislation in respect of this particular section has all along been to eliminate the necessity of any enquiry into the subjective question of dishonest intention. In 1969 the word deliberately was omitted before the word conceals from the language of the section. This to a large extent removed the necessity of going into the motive of concealment. Thereafter in 1976, Part (2) was introduced in Section 43 which said if the total tax returned by the dealer is less than 80 per cent of the total tax assessed under Section 18, such dealer shall be deemed to have concealed his turnover. . . . . . . . . . Here again a formula is introduced by which concealment can be mechanically established instead of going into an investigation of the motives, etc. In other words, whenever the facts and circumstances of the case disclose a large variation in the tax returned and the tax finally assessed, the presumption is inescapable that there has been concealment attracting the provision of Section 43 of the Act. " Aggrieved by the decisions of the Tribunal in various appeals filed by it, the assessee moved the Tribunal for making references and on the basis of these applications, the Tribunal made the aforesaid references either under Section 44 (1) or under Section 44 (3) of the Act as aforesaid. ( 5. ) THE learned counsel for the assessee cited several authorities before us and submitted that the Tribunal committed an error in not considering the explanation offered by the assessee for the differences between the tax assessed and the tax returned on erroneous interpretation of Section 43 of the Act, and therefore, the aforesaid questions referred to this Court required to be answered in favour of the assessee and against the department. ( 6. ) THE learned Deputy Advocate General appearing for the Revenue supported the impugned orders of the Tribunal by placing reliance on Food Corporation of India v. Commissioner of Sales Tax [1983] 54 STC 332 (MP) ; (1983) 16 VKN 275, and Malwa Vanaspati and Chemical Co. ( 6. ) THE learned Deputy Advocate General appearing for the Revenue supported the impugned orders of the Tribunal by placing reliance on Food Corporation of India v. Commissioner of Sales Tax [1983] 54 STC 332 (MP) ; (1983) 16 VKN 275, and Malwa Vanaspati and Chemical Co. Ltd. v. Commissioner of Sales Tax [1983] 54 STC 198 (MP ). Since January 19, 1976, Section 43 of the Act reads as follows : "43 (1) If the Commissioner or the appellate authority in the course of any proceedings under this Act is satisfied that the dealer has concealed his turnover or the aggregate amount of purchase prices in respect of any goods or has furnished inaccurate particulars of such sales or purchases, as the case may be, or furnished a false return, the Commissioner or the appellate authority, as the case may be, after giving the dealer a reasonable opportunity of being heard, may direct that the dealer shall, in addition to the tax payable by him, pay by way of penalty a sum, which shall not be less than 20 per cent but shall not exceed one and one half times the amount of the tax, if any, which would have been avoided if the returns furnished by the dealer had been accepted as correct or the concealment of the sales or purchases or inaccurate particulars of sales or purchases had not been detected. (2) If the total tax returned by the dealer is less than 80 per cent of the total tax assessed under Section 18, such dealer shall be deemed to have concealed the particulars of his turnover or aggregate of his purchase prices or furnished inaccurate particulars of such turnover or aggregate of purchase prices for the purposes of this section unless he proves that the failure to return the correct turnover or aggregate of purchase prices did not arise from any fraud or gross or wilful negligence on his part. " ( 7. ) PRIOR to January 19, 1976, Section 43 was to the following effect : "43. " ( 7. ) PRIOR to January 19, 1976, Section 43 was to the following effect : "43. If the Commissioner or the appellate authority in the course of any proceeding under this Act, is satisfied that a dealer has concealed his turnover or aggregate of the amount of purchase prices in respect of any goods or furnished a false return, the Commissioner or the appellate authority, as the case may be, may after giving the dealer a reasonable opportunity of being heard, direct that the dealer shall, in addition to the tax payable by him, pay by way of penalty a sum not exceeding the amount of the tax which would have been avoided if the return furnished by the dealer had been accepted as correct. " ( 8. ) IN cases relating to periods prior to January 19, 1976, the provisions of Section 43 of the Act, as they stood prior to January 19, 1976, would be applicable, but the Tribunal has applied the provisions of Section 43, as they stand today and are in force from January 19, 1976. While construing the old provisions of Section 43, the Supreme Court observed in Cement Marketing Co. of India Ltd. v. Assistant Commissioner of Sales Tax [1980] 45 STC 197 that Section 43 of the Act, "providing for imposition of penalty is penal in character and unless the filing of an inaccurate return is accompanied by a guilty mind, the section cannot be invoked for imposing penalty". Similar view has been taken by the Supreme Court, as also by this Court, in various other cases. No finding was given by the Tribunal about existence of mens rea for the inaccurate returns filed by the assessee for the periods prior to January 19, 1976, and therefore, the Tribunal was not justified in upholding the imposition of penalty under Section 43 of the Act in regard to periods prior to January 19, 1976. So far as the periods after January 19, 1976, are concerned, it may be observed that interpreting similar provisions in Section 271 of the Income-tax Act, it was held by the Madras High Court in Commissioner of Income-tax v. Imperial Automobiles [1983] 141 ITR 60 that the explanation in Section 271 (1) (c) of the Income-tax Act provided nothing more than rule of evidence relating to the raising of rebuttable presumption in certain circumstances. It is not a rule which creates or negates any substantive right. Thus the explanation was held not to have the effect of altering the substantive law on the subject of penalty for concealment. It only introduces a special rule of evidence applicable to cases coming within a particular penalty bracket. This view of the Madras High Court was based on the decision of the Supreme Court in Commissioner of Income-tax v. Anwar Ali [1970] 76 ITR 696. Accordingly we are of the view that the Tribunal was not justified in upholding the imposition of penalty under Section 43 of the Act without considering the explanation or without recording a finding that the explanation offered by the assessee was false or not acceptable. Cases cited on behalf of Revenue are distinguishable on facts and need no consideration. ( 9. ) ALTHOUGH three questions of law have been referred to us by the Tribunal in M. C. C. Nos. 257, 258, 259, 260, 261, 262 and 263 of 1987, we are of the view that they are all covered in the question of law referred to us in the other cases and which has been considered and answered by us in the foregoing paragraphs. The only difference is that the questions relate to imposition of penalty in respect of differences in tax assessed and the tax returned for taxes under the Central and State Sales Tax Acts and the Entry Tax Act. ( 10. ) THE upshot of our foregoing discussion is that all the questions referred to us deserve to be answered in favour of the assessee and against the Revenue and accordingly we answer the questions in favour of the assessee and against the Revenue. ( 11. ) IN the circumstances of the case we make no order as to costs of these references.