JUDGMENT A. K. MATHUR, C.J. - This is a reference under section 44(1) of the M.P. General Sales Tax Act, 1958 (for short, "the Act") at the instance of the assessee and the following question has been referred by the Tribunal for answer by this Court : "Whether, under the facts and circumstances of the case, the Tribunal was justified under the law in upholding the penalty of Rs. 52,431 imposed under section 45-B(2) of the M.P. General Sales Tax Act, 1958 ?" 2. Brief facts giving rise to this reference are that M/s. Tata Iron and Steel Co. Ltd., Bhopal are dealers in iron and steel items. They were assessed to sales tax for the period April 1, 1980 to March 31, 1981 by the Regional Assistant Commissioner, Sales Tax, Bhopal, by order dated December 28, 1984 and among other things, a penalty of Rs. 52,431 was imposed on the assessee under section 45-B of the Act. Aggrieved by this order, the assessee preferred first appeal before the Appellate Deputy Commissioner of Sales Tax, Bhopal, who dismissed the appeal. Thereafter, the assessee approached the Tribunal which also confirmed the order passed by the Appellate Deputy Commissioner, Sales Tax. Hence the assessee approached the Tribunal for making a reference to this Court and the Tribunal has accordingly referred the aforesaid question for answer by this Court. 3. We have heard learned counsel for the parties and perused the record. The admitted facts are that M/s. Tata Iron and Steel Co. Ltd., Bhopal, sold certain items of iron and steel to the M. P. Setu Nirman Nigam and charged sales tax at the rate of 4 per cent, amounting to Rs. 52,431 and this amount of tax was deposited by the assessee in the State treasury. Thereafter, the Nigam furnished form XII-J to the assessee and the assessee, in turn, refunded the amount of tax so collected, to the Nigam and claimed a deduction before the assessing authority. The assessing authority, in spite of producing form XII-J and instead of granting this benefit to the assessee, held that this tax had been illegally recovered by the assessee and imposed a penalty of Rs. 52,431 under section 45-B(2) of the Act, treating it to have been illegally collected. The assessing authority, in spite of producing form XII-J and instead of granting this benefit to the assessee, held that this tax had been illegally recovered by the assessee and imposed a penalty of Rs. 52,431 under section 45-B(2) of the Act, treating it to have been illegally collected. It is further submitted that the amount was given by the assessee to the Nigam by credit note beyond time-limit in July 1980, September 1980, October 1980, November 1980, January 1981 and March 1981 and the amount was refunded by the assessee to the Nigam in May 1985, after three years. Therefore, this amount was forfeited by the authorities as illegally collected under section 45-B of the Act. This approach of the assessing authority is absolutely erroneous. Section 45-B of the Act reads as under : "45-B. Collection of tax by dealers. - (1) No person other than a registered dealer or a person who is deemed to be dealer who has failed to apply for registration under the provisions of clause (b) of sub-section (11) of section 15 or sub-section (7) of section 16-A shall collect any amount by way of tax under this Act and no collection of tax shall be made except in accordance with the provisions of this Act and the Rules made thereunder. (2) If any person collects any amount by way of tax in contravention of the provisions of sub-section (1), he shall be liable to pay a penalty not less than the amount so collected, but not exceeding double the amount of such tax. Explanation. - A dealer specified in clause (b) of sub-section (11) of section 15 or sub-section (7) of section 16-A shall be deemed to be registered dealer for the purpose of this sub-section." 4. Sub-section (1) says that no person other than a registered dealer or a person who is deemed to be a dealer who has failed to apply for registration under the provisions of the Act shall collect any amount by way of tax under this Act and no collection of tax shall be made except in accordance with the provisions of the Act and the Rules made thereunder. So far as the assessee is concerned, he is a registered dealer and has collected tax from the Nigam, because the Nigam did not produce form XII-J for giving total exemption from payment of tax. So far as the assessee is concerned, he is a registered dealer and has collected tax from the Nigam, because the Nigam did not produce form XII-J for giving total exemption from payment of tax. The Nigam was charged 4 per cent of tax. When the Nigam furnished form XII-J to the assessee, the assessee refunded back the amount to the Nigam and claimed deduction, but the same was refused on the ground that tax was illegally collected in view of sub-section (2) of section 45-B, of the Act. 5. At the time when the tax was collected by the assessee, the assessee was within his right, because assessee being a dealer and he is under an obligation to collect tax due and if the tax was not collected by the assessee, he would have been hauled up under the provisions of the Act. Therefore, the assessee was within his right and justified in collecting the tax on account of non-production of form XII-J, by the Nigam. Therefore, it cannot be said that the collection of tax was illegal or unauthorised in violation of sub-section (1) of section 45-B of the Act. Sub-section (2) of section 45-B only enables the assessing authority to forfeit the amount if tax had been illegally collected. 6. As pointed out above, the tax was duly collected in accordance with the provisions of the Act, because the Nigam did not furnish form XII-J to the assessee. Therefore, the assessee could not have permitted full concession on the purchase made by the Nigam. The Nigam furnished form XII-J before the assessee and the amount was refunded, though it might have been distributed after a period of three years, but this fact could not have been taken into account for forfeiting the amount of tax it was between assessee and Nigam. The only question for consideration was whether the amount in question was illegally and unauthorisedly collected by the assessee or not. 7. In the present case, the authorities totally misdirected themselves because it transpires from the record that at the time when the collection was made, the assessee was fully justified in collecting the amount and thereafter deposited it in the State treasury. There is no mens rea on the part of the assessee to collect the tax illegally. 7. In the present case, the authorities totally misdirected themselves because it transpires from the record that at the time when the collection was made, the assessee was fully justified in collecting the amount and thereafter deposited it in the State treasury. There is no mens rea on the part of the assessee to collect the tax illegally. The levy of the penalty should have some element of dishonesty or a deliberate violation of any of the provisions of the Act or some mens rea, but there was none in the present case. We are, therefore, of the opinion that the approach of the assessing authority was absolutely illegal and without jurisdiction. 8. We answer the question referred to us in favour of the assessee and against the Revenue. Reference answered in the negative.