JUDGMENT G. SIVARAJAN, J. – The matter arises under the Kerala General Sales Tax Act, 1963. The petitioner is the proprietor of a business concern by name "Vijaya Industries, Mulankunnathukavu, Trichur" doing business in the manufacture and sale of packing materials. He is a registered dealer both under the Kerala General Sales Tax Act, 1963 as well as under the Central Sales Tax Act, 1956. He is an assessee on the files of the first respondent, Sales Tax Officer. During the assessment year 1985-86 the petitioner did not file monthly returns as contemplated under the provisions of the Kerala General Sales Tax Act, 1963 and the Rules for the months of June, 1985 to March 1986 as well as annual return in form No. 8 before January 19, 1987. The tax as per the returns was paid only on March 18, 1987. Similarly during the year 1986-87 the monthly returns for April, 1986 to November, 1986 were filed only on January 19, 1987 and the tax as per those returns was paid only on March 19, 1987. So also, the monthly returns for April, 1986 to November, 1986 in respect of Central sales tax assessment for the year 1986-87 were also filed only on January 19, 1987 and the tax due as per those returns was remitted only on March 19, 1987. According to the petitioner, he has paid penal interest under section 23(3) of the Act in respect of the defaulted amounts. 2. It is the case of the petitioner that the first respondent-assessing authority - had issued notice to him under section 45A of the K.G.S.T. Act proposing to levy penalty for the delay in filing the returns and payment of tax under the provisions of the K.G.S.T. Act for the assessment years 1985-86 and 1986-87 and also under the provisions of the C.S.T. Act for the assessment year 1986-87. According to the petitioner, though he had brought to the notice of the assessing authority the circumstances in which he was disabled from filing the returns accompanied by the receipt for payment of the tax in time, the assessing authority without considering the said explanation issued three separate orders all dated April 4, 1987 imposing penalty of Rs. 40,000 and Rs. 20,000 for the assessment years 1985-86 and 1986-87 respectively under the K.G.S.T. Act and Rs. 40,000 and Rs. 20,000 for the assessment years 1985-86 and 1986-87 respectively under the K.G.S.T. Act and Rs. 14,000 for the assessment year 1986-87 under the C.S.T. Act, evidenced by exhibits P-1 to P-3 orders. Petitioner took up these three orders in revision before the Deputy Commissioner of Agricultural and Income-tax and Sales Tax, Trichur, who is the second respondent herein. The Deputy Commissioner reduced the amount to Rs. 20,000 and Rs. 10,000 for the assessment years 1985-86 and 1986-87 respectively under the K.G.S.T. Act and Rs. 7,500 for the assessment year 1986-87 under the C.S.T. Act. The petitioner took up the matter in further revision before the Board of Revenue but without success. Exhibits P-6 is the order issued by the Board of Revenue. In this original petition the petitioner has challenged exhibits P-1 to P-6 orders passed by the respondents and also prayed for a direction to the respondents to restrain from collecting any amount pursuant to the said orders. 3. A counter-affidavit was filed on behalf of respondents 1 to 3 wherein it is stated that the petitioner had filed monthly returns and annual returns in form No. 8 for the year 1985-86 and the C.S.T. return in form No. II for the period from April, 1986 to November, 1986 only and that the collected tax was not paid when the returns were filed. It is further stated that the collected tax of Rs. 33,523.41 for the year 1985-86 under the C.S.T. was not paid till March 1, 1986, that the monthly returns in form No. 9 and form No. II for the months of April, 1986 to November, 1986 were filed only on January 19, 1987 and the collected tax was also not paid and that the petitioner is bound to file monthly returns along with proof of payment of tax if any on or before 20th of each succeeding months. It is also stated that the balance of collected tax amounting to Rs. 33,523 under C.S.T. Act for 1985-86 and tax due for the months of April, 1986 to November, 1986 amounting to Rs. 14,922.87 were paid only on March 19, 1987. It is further stated that the tax due for the months of April, 1986 to November, 1986 under C.S.T. Act amounting to Rs. 33,523 under C.S.T. Act for 1985-86 and tax due for the months of April, 1986 to November, 1986 amounting to Rs. 14,922.87 were paid only on March 19, 1987. It is further stated that the tax due for the months of April, 1986 to November, 1986 under C.S.T. Act amounting to Rs. 7,044.72 was not paid till March 18, 1987 and that the non-filing of returns along with proof of payment is an offence punishable under section 45A of the K.G.S.T. Act, 1963. It is also stated that it is for the failure to comply with the provisions of section 17 of the K.G.S.T. Act, 1963 read with rule 21(7) of the Rules made therein that the assessing authority has initiated proceedings under section 45A of the Act, that the petitioner has not even paid the collected tax, that the non-payment of the tax in time was a wilful action on the part of the petitioner and that the assessing authority was perfectly justified in invoking the penal provision of section 45A of the Act. It is averred that the petitioner was fully aware of the obligations under section 17 of the Act read with rule 21(7) of the Rules and that the petitioner has thus violated the statutory provisions and delayed the payment of tax legitimately due to the Government. Regarding the quantum of penalty also it is stated that the first revisional authority has granted substantial relief. 4. The learned counsel appearing for the petitioner submitted that in the instant case the petitioner could not file the monthly returns as well as the annual returns for the assessment years 1985-86 and 1986-87 under the K.G.S.T. Act as well as for the period from April, 1986 to November, 1986 in respect of the assessment year 1986-87 under the C.S.T. Act for the reasons that petitioner's sales were mostly credit sales, that during the aforesaid two years several customers of the petitioner failed to pay the price of the goods supplied to them and that in certain cases cheques issued by the said customers were dishonoured with the result that the petitioner was forced to take legal steps against the above parties for realisation of the amounts by filing suits in civil courts and complaints in the magistrate's court. Accordingly to the learned counsel, during the said period the petitioner was in acute financial difficulties. Accordingly to the learned counsel, during the said period the petitioner was in acute financial difficulties. The learned counsel submitted that in spite of the provisions of section 17 of the K.G.S.T. Act read with rule 21(7) of the K.G.S.T. Rules the petitioner could not remit the tax due in respect of the sales turnover for the aforesaid years only because of the circumstances mentioned hereinabove. The learned counsel for the petitioner further submitted that later the petitioner has filed monthly returns and annual return for the assessment years 1985-86 and 1986-87 under the K.G.S.T. Act as well as for the assessment year 1986-87 under the C.S.T. Act. It is further submitted that the petitioner had also paid not only the tax due as per the assessment orders for the said years but also penal interest under section 23(3) of the Act for the delay in payment of the tax due as per the returns. On the basis of the above, the learned counsel submitted that the loss suffered by the Government on account of the delay in payment of the tax has already been compensated by paying penal interest as provided under section 23(3) of the K.G.S.T. Act and therefore, the contravention, if any, of the provisions of section 17 of the Act read with rule 21(7) of the Rules is only technical or venial. He further submitted that the circumstances pointed out above will clearly show that the delay in filing the returns and in making the payment of the amount due as per the said returns was caused due to the bona fide reasons and that there is no wilful or contemptuous conduct on the part of the petitioner in not complying with the provisions mentioned earlier. In support of the said submission, the learned counsel also relied on the decision of the Supreme Court in Hindustan Steel Ltd. v. State of Orissa [1970] 25 STC 211 and also the decision of this Court in Sudhi v. Intelligence Officer [1992] 85 STC 337. The learned counsel also submitted that the authorities while imposing penalty and sustaining the same to the extent modified by the Deputy Commissioner, did not keep in mind the principles laid down by the Supreme Court and by this Court in the abovementioned cases. The learned counsel also submitted that the authorities while imposing penalty and sustaining the same to the extent modified by the Deputy Commissioner, did not keep in mind the principles laid down by the Supreme Court and by this Court in the abovementioned cases. The learned counsel submitted that there is no justification for the imposition of penalty and that at any rate, the maximum penalty that can be imposed in this case is only Rs. 5,000 for each year. 5. I have also heard the Special Government Pleader for Taxes. He submitted that the petitioner was statutorily bound to file monthly returns in respect of the turnover as contemplated under section 17 of the Act read with rule 21(7) of the Rules and also to pay the tax due as per the said returns on or before the 20th of the succeeding month and that in the instant case, the petitioner has not remitted even the tax collected by him from the customers. The learned Government Pleader, however, admitted that the petitioner had filed the returns both monthly as well as annual for both the years under the K.G.S.T. Act as well as for the assessment year 1986-87 under the C.S.T. Act and had also paid the tax due as per the returns though belatedly. The learned Government Pleader also admitted that the penal interest under section 23(3) of the Act in respect of the delay in payment of the tax due as per the return also has been paid by the petitioner. However, the learned Government Pleader submitted that the non-remittance of even the collected tax is a serious default that the petitioner knowing fully well the legal obligations under the provisions of the Act and the Rules has failed to comply with the same and that this itself is sufficient to establish lack of bona fides in the matter. He also submitted that no further material is required to show that the default was wilful. The learned Government Pleader also submitted that the first revisional authority has granted substantial relief by reducing the penalty by 50 per cent and that there is no case for interference with exhibits P-4 and P-5 orders as affirmed by exhibit P-6 by the Board of Revenue. 6. I have considered the matter. The learned Government Pleader also submitted that the first revisional authority has granted substantial relief by reducing the penalty by 50 per cent and that there is no case for interference with exhibits P-4 and P-5 orders as affirmed by exhibit P-6 by the Board of Revenue. 6. I have considered the matter. The admitted facts are that for the moths of June, 1985 to March, 1986 as well as for the months of April, 1986 to November, 1986 the petitioner did not file the monthly returns along with the tax due as per such returns as contemplated under rule 21(7) of the K.G.S.T. Rules within the stipulated time. The petitioner did not also file the annual returns for 1985-86 as well as for 1986-87 within the time prescribed therefor under the Rules. The monthly returns for the months of June, 1985 to March 1986 as well as the annual return for the year 1985-86 were filed only on January 19, 1987 and the tax due as per the said returns was paid only on March 18, 1987. Similarly monthly returns for the months of April, 1986 to November, 1986 and the annual return for the year 1986-87 were filed only on January 19, 1987. The tax due as per those returns was paid only on March 19, 1987. So also, the monthly returns for April, 1986 to November, 1986 and also the annual return for the year 1986-87 under the C.S.T. Act were filed only on January 19, 1987 and the tax due as per those returns was remitted only on March 19, 1987. It is also an admitted fact that penal interest under section 23(3) of the Act for the delay in filing both the monthly and annual returns for the assessment years 1985-86 and 1986-87 was also paid by the petitioner. It is clear from the admitted facts stated above that the petitioner has violated the provisions of section 17 of the Act read with rule 21(7) and 27(11) of the Rules in so far as the returns and the tax due as per the said returns as provided under the said provisions were not made within the time stipulated under the said provisions. Same is the case with regard to the C.S.T. assessment for the year 1986-87. 7. Same is the case with regard to the C.S.T. assessment for the year 1986-87. 7. The question arising for consideration is as to whether the authorities under the Act were justified in imposing penalty under section 45A of the Act and if so, as to the quantum of penalty to be imposed. Section 45A(1) of the Act without the two Explanations reads as follows : "45A. Imposition of penalty by officers and authorities. - (1) If the assessing authority or the Appellate Assistant Commissioner is satisfied that any person, - (a) being a person required to register himself as dealer under this Act, did not get himself registered; or (b) has failed to keep true and complete accounts; or (c) had failed to submit any return as required by the provisions of this Act or the rules made thereunder; or (d) has submitted an untrue or incorrect return; or (e) has failed to comply with all or any of the terms of any notice or summons issued to him by or under the provisions of this Act or the rules made thereunder; or (f) after purchasing any goods in respect of which he has made a declaration under proviso to sub-section (3) of section 5, has failed to make use of the goods for the declared purpose; or (g) has acted in contravention of any of the provision of this Act or any rule made thereunder, for the contravention of which no express provision for payment of penalty or for punishment is made by this Act; such authority or officer may direct that such person shall pay, by way of penalty, an amount not exceeding twice the amount of sales tax or other amount evaded or sought to be evaded where it practicable to quantify the evasion or an amount not exceeding five thousand rupees in any other case." The relevant clauses in the said sub-section that have application in the instant case are sub-clauses (c) as well as (g) thereof. Section 45A(1) provides that if the assessing authority or the Appellate Assistant Commissioner is satisfied that any person has committed any of the offences mentioned in clauses (a) to (g) thereof, then such authority or officer may direct that such person shall pay, by way of penalty, an amount not exceeding twice the amount of sales tax or other amount evaded or sought to be evaded where it is practicable to quantify the evasion or an amount not exceeding five thousand rupees in any other case. The validity of the provisions of section 45A of the Act came up for consideration before a Division Bench of this Court in P. D. Sudhi v. Intelligence Officer, Agricultural Income-Tax and Sales Tax, Mattancherry [1992] 85 STC 337 and this Court had upheld the validity of the aforesaid provision. While considering the scope and content of the said provision, this Court held that the use of the words "evasion" and the expression "sought to be evaded" makes it clear that it is not the mere default that is made the foundation for the liability to penalty, but it is the contumacious or fraudulent or other blame-worthy or objectionable conduct of an assessee in fulfilling his obligations mentioned in section 45A of the Act, that will attract the levy of penalty. It is further observed that the concept of mens rea is embedded in the expressions "evaded" or "sought to be evaded" occurring in section 45A(1) of the Act. It is also observed by this Court that the initiation of proceedings under section 45A is discretionary. Even if a person has committed any one of the defaults specified in section 45A of the Act and the concerned authority is also satisfied about the same, the levy of penalty is not compulsive, but only enabling or permissive. The maximum amount of penalty that can be levied is alone indicated. Before penalty is imposed the authorities are bound to give the assessee and opportunity of being heard. This Court further observed that the quantum of penalty should depend upon the gravity of the offence. The maximum amount of penalty that can be levied is alone indicated. Before penalty is imposed the authorities are bound to give the assessee and opportunity of being heard. This Court further observed that the quantum of penalty should depend upon the gravity of the offence. The guidelines to be borne in mind with regard to such penal provisions have been started by the Supreme Court in Hindustan Steel Ltd. v. State of Orissa [1970] 25 STC 211 at 214 as follows : ".........An order imposing penalty for failure to carry out a statutory obligation is the result of quasi-criminal proceeding, and penalty will not ordinarily be imposed unless the party obliged either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstance. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act or where the breach flows from a bona fide belief that the offender is not liable to act in the manner prescribed by the statute." 8. The various matters to be taken into account before imposition of penalty have been stated by this Court in St. Michael's Oil Mills v. State of Kerala [1988] 68 STC 360 where this Court observed as follows : "The maximum penalty leviable under section 28(8) of the Kerala General Sales Tax Act, 1963 is 50 per cent of the value of the unaccounted stock. However, the mere fact that section 28(8) of the Act permits levy of 50 per cent of the value of unaccounted stock, does not mean that the officer imposing penalty can impose the maximum amount in all cases. He has first to be satisfied whether, on the facts and circumstances of any case, penalty is exigible, and if so, what quantum should be levied. The order levying penalty should show that both these aspects were borne in mind while levying the penalty. He has first to be satisfied whether, on the facts and circumstances of any case, penalty is exigible, and if so, what quantum should be levied. The order levying penalty should show that both these aspects were borne in mind while levying the penalty. Penalty proceedings are quasi-criminal in nature and in imposing penalty under section 28(8), the officer has to act judicially and not arbitrarily or mechanically." 9. If the question regarding the exigibility is considered on the basis of the admitted facts in the light of the principles discussed above, it can be seen that the assessing authority was justified in initiating penalty proceedings under section 45A(1) for, the petitioner has violated the provisions of section 17 of the Act read with rules 21(7) and 21(11) of the Rules which attracts the provisions of clauses (a) and (g) of sub-section (1) of section 45A. According to the petitioner, he was disabled from filing the return and remitting the tax as per the said return in view of the non-receipt of the credit sale proceeds and also the pendency of the civil suit for recovery of the said amounts as well as the acute financial difficulties experienced by him. That is not a valid excuse for not paying even the collected tax. It cannot be said that the failure to file the monthly returns as well as the annual returns for the years 1985-86 and 1986-87 under the K.G.S.T. Act as well as the monthly returns and the annual return for the year 1986-87 under the C.S.T. Act and to remit the tax due as per the said returns along with the returns within the time stipulated under the Act and the Rules is due to any bona fide circumstances. It has to be held that the failure on the part of the petitioner to file the returns and to remit the tax is wilful. 10. However, while considering the question of quantum of penalty it is not necessary to consider the gravity of the offences and other circumstances. In this case, as already stated, the petitioner had filed the monthly returns as well as the annual returns for the years 1985-86 and 1986-87 under the K.G.S.T. Act as well as for the assessment year 1986-87 under the C.S.T. Act though belatedly and tax due as per the said returns was also remitted. In this case, as already stated, the petitioner had filed the monthly returns as well as the annual returns for the years 1985-86 and 1986-87 under the K.G.S.T. Act as well as for the assessment year 1986-87 under the C.S.T. Act though belatedly and tax due as per the said returns was also remitted. The petitioner has also paid the penal interest due on account of the delay in filing the returns. Thus, the loss, if any, caused to the State on account of the delay in making the remittance of the amount due to the State is compensated by the payment of penal interest. However, it cannot be said that the offence committed by the petitioner is only technical or venial. It is really of a serious nature. If persons who are liable to pay tax due under the Act fail to file the return and to remit the tax due as per the said return along with the return itself and if they are left to remit the said dues according to their convenience, that will be a premium to dishonest assessees. So, this cannot be left in a light manner. In the instant case, the assessing authority imposed penalty of Rs. 40,000 for the assessment year 1985-86 and Rs. 20,000 for the assessment year 1986-87 both under the K.G.S.T. Act and also imposed a penalty of Rs. 14,000 for the assessment year 1986-87 under the C.S.T. Act. The first revisional authority has modified the same to Rs. 20,000 and Rs. 10,000 for the assessment years 1985-86 and 1986-87 respectively under the K.G.S.T. Act and Rs. 7,500 for the year 1986-87 for offences under the C.S.T. Act. The Board of Revenue affirmed the same by dismissing the second revision filed by the petitioner. It cannot be said in this case that the assessee has evaded or sought to evade any tax due under the Act. It is only a case of delay in complying with the provisions of the Act, viz., submitting the returns within the time stipulated in rules 21(7) and 27(11) of the K.G.S.T. Rules which can be considered to be a contravention as contemplated in section 45A of the Act. The maximum penalty that could be imposed in such circumstances is only Rs. 5,000. 11. Considering the totality of the circumstances in this case, I am of the view that penalty of Rs. The maximum penalty that could be imposed in such circumstances is only Rs. 5,000. 11. Considering the totality of the circumstances in this case, I am of the view that penalty of Rs. 5,000 each for the assessment years 1985-86 and 1986-87 under the K.G.S.T. Act and for 1986-87 under the C.S.T. Act alone can be imposed. I do so. In the result, the penalty orders exhibits P-1 to P-3 as modified by exhibits P-4 and P-5 by the first revisional authority and confirmed by the Board of Revenue shall stand modified as above. The original petition is allowed to the above extent. In the circumstances of the case there will be no order as to costs. Petition allowed.