JUDGMENT Chitra Venkataraman, J. 1. The assessee has filed the present Tax Case (Revisions) as against the order of the Tamil Nadu Sales tax Appellate Tribunal relating to the assessment years 1986-87, 1987-88, 1988-89 and 1989-90. 2. The questions of law raised in the above Tax Case (Revisions) are almost identical. They relate to levy of sales tax on Vend Fee, levy of purchase tax under Section 7A of the Tamil Nadu General Sales Tax Act on the purchase of empty bottles from unregistered dealers and penalty levied under Section 12(3) and 12(5)(iii) of the Tamil Nadu General Sales Tax Act. While T.C.(R)No.1669 of 2008 relates to levy of penalty under Section 12(3)/12(5)(iii) on the turnover relating to Excise Duty and Vend Fee apart from tax on Vend Fee and Section 7-A purchase tax for purchase of empty bottles, T.C.(R)No.1857 of 2008 relates to levy of purchase tax under Section 7-A and penalty under Section 12(5)(iii) based on turnover relating to Excise Duty and Vend Fee. T.C.(R)No.13 of 2009 relates to levy of purchase tax under Section 7-A; penalty under Section 12(3) on the turnover relating to Excise Duty and Vend Fee and penalty under Section 12(5)(iii) for purchase tax under Section 7-A. T.C.(R)No.1667 of 2008 relates to levy of purchase tax under Section 7A and penalty under Section 12(5)(iii) on purchase tax under Section 7A of the Tamil Nadu General Sales Tax Act. 3. Learned senior counsel appearing for the assessee pointed out that as far as levy of Vend Fee payable by the wholesale seller, which was included in the turnover of the assessee is concerned, the same is covered in favour of the assessee by the decision of this Court in T.C.(R)Nos.637 of 2006 etc. batch dated 19.9.2013 in the assessee's own case; consequently, the question of levy of sales tax on the Vend Fee paid by the wholesalers under the Tamil Nadu Indian made Foreign Spirits (Supply by Wholesale) Rules, 1981 does not arise. batch dated 19.9.2013 in the assessee's own case; consequently, the question of levy of sales tax on the Vend Fee paid by the wholesalers under the Tamil Nadu Indian made Foreign Spirits (Supply by Wholesale) Rules, 1981 does not arise. As far as the levy of purchase tax under Section 7-A on purchase of empty bottles is concerned, learned senior counsel pointed out that considering the decision of this Court reported in (2005) 139 STC 477 (Mohan Breweries and Distilleries Limited V. Commercial Tax Officer, Porur Assessment Circle, Chennai and others), the issue has to be answered against the assessee and hence, the turnover on the purchase of empty bottles from unregistered dealers has to be assessed under Section 7A of the Tamil Nadu General Sales Tax Act. 4. This leaves us with only one question as regards the levy of penalty, which is a common question in all the four tax cases. 5. Learned senior counsel appearing for the assessee pointed out that on the question of levy of penalty, as of today, the only turnover that survives for consideration by this Court is on the aspect of excise duty and Section 7-A levy, where this Court had already confirmed the assessment on the inclusion of excise duty as part of the turnover and the liability under Section 7-A. As far as the levy of penalty on the question of excise duty levied on the petitioner is concerned, learned senior counsel pointed out that till the date of the decision of this Court reported in (1990) 78 STC 461 dated 25th April, 1989 (Mohan Breweries and Distilleries Ltd. V. Commercial Tax Officer), there existed a serious doubt as regards the inclusion of excise duty paid by the dealer as part of the turnover of the manufacturer, namely, the assessee. As a licensed manufacturer of Indian made foreign liquor, the assessee was required to effect sales of the product to the Tasmac, the wholesale seller. Under Section 18B of the Tamil Nadu Prohibition Act, 1937, the excise duty was paid to the Government only by the wholesaler and upon production of the duty paid challan, the assessee effected delivery of the product to the Tasmac, which was the sole wholesale purchaser of the product. Under Section 18B of the Tamil Nadu Prohibition Act, 1937, the excise duty was paid to the Government only by the wholesaler and upon production of the duty paid challan, the assessee effected delivery of the product to the Tasmac, which was the sole wholesale purchaser of the product. Thus the consistent case of the assessee was the turnover on the excise duty paid by the wholesaler was never treated as part of the turnover of the assessee. 6. Learned senior counsel pointed out that even though as early as 17.4.1985, in the decision reported in (1985) 59 STC 277 (McDowell & Company. Ltd., V. Commercial Tax Officer), the Apex Court had held that the excise duty was part of the turnover of the manufacturer and the mere discharge of the obligation by the distributor would not take the excise duty out of the turnover, yet, as far as Tamil Nadu was concerned, the doubt as regards the inclusion of this excise duty into the turnover remained a matter of consideration till the amendments were brought into the Tamil Nadu Indian Made Foreign Spirits (Manufacture) Rules, 1981 as well as to the Tamil Nadu Indian Made Foreign Spirits (Supply of Wholesale) Rules, 1981 made under the provisions of the Prohibition Act. He further pointed out that by reason of the correspondences between the Chairman of the Tasmac and the further deliberations between the Prohibition and Excise Department and the assessee entertaining the impression that the Tasmac being the authority to meet the liability on payment of excise duty, and hence there was a bona fide dispute as to the inclusion of excise duty in the turnover of the assessee. In the background of this, when a dispute was raised before this Court, the same was settled only on 25th April, 1989 holding that the excise duty paid by the wholesaler at the time of purchase from manufacturer formed part of the price paid for the goods, hence, includible in the turnover of the manufacturer. Thus, the clear picture emerged only on the decision of this Court dated 25th April, 1989. Hence, the question of alleging that the assessee lacked bona fides in its claim on excluding the excise duty payable from the turnover did not arise. Thus, the clear picture emerged only on the decision of this Court dated 25th April, 1989. Hence, the question of alleging that the assessee lacked bona fides in its claim on excluding the excise duty payable from the turnover did not arise. In other words, learned senior counsel submitted that the assessee was all the time under the bona fide belief that excise duty paid by the wholesaler was not includible in the turnover; consequently, on this ground, there was no conscious misstatement warranting levy of penalty. 7. As far as the purchase tax levied on the empty bottles purchased and consumed/used in the manufacture of liquor is concerned, he took us through the circular dated 9.11.1989 issued by the Commissioner as regards the liability on excise duty, followed by a clarification dated 27.12.2000 that the sale of bottles would not attract Section 7A liability and in the light of the decision rendered on 10th September, 2004 reported in (2005) 139 STC 477 (Mohan Breweries and Distilleries Limited V. Commercial Tax Officer, Porur Assessment Circle, Chennai and others) alone, the assesee's dispute came to a resolution before this Court. In the circumstances, even herein, placing reliance on the decision of this Court reported in (2002) 125 STC 500 (Appollo Saline Pharmaceuticals (P) Limited V. Deputy Commercial Tax Officer and another), he submitted that there is no case for levy of penalty and hence the same has to be cancelled. 8. It is a matter of relevance to note that the cancellation of the clarification circular dated 27.12.2000 under order dated 28.1.2002 itself came consequent on the decision of the Tamil Nadu Taxation Special Tribunal dated 20.4.1994. The said decision was confirmed by this Court in the decision reported in (2002) 125 STC 500 (Appollo Saline Pharmaceuticals (P) Limited V. Deputy Commercial Tax Officer and another). Thus, on the position thus prevailed till the decision of this Court, the bona fides of the assessee in not offering the turnover under Section 7A could not be doubted. 9. The said decision was confirmed by this Court in the decision reported in (2002) 125 STC 500 (Appollo Saline Pharmaceuticals (P) Limited V. Deputy Commercial Tax Officer and another). Thus, on the position thus prevailed till the decision of this Court, the bona fides of the assessee in not offering the turnover under Section 7A could not be doubted. 9. Countering the claim of the assessee, learned Additional Government Pleader appearing for the Revenue submitted that when the Apex Court had already decided on the inclusion of excise duty in the turnover even as early as 17.4.1984, it is not now open to the assessee to claim that they had no knowledge about or that the liability was not settled as regards the inclusion of excise duty as part of the turnover. Further, as regards the Section 7A liability, circulars themselves are not binding on the issue raised on the sustainability of the turnover. In the circumstances, the claim of the assessee could not be countenanced. 10. Heard learned senior counsel appearing for the assessee and the learned Additional Government Pleader appearing for the Revenue and perused the materials placed before this Court. 11. As fairly stated by the learned senior counsel appearing for the assessee, as far as the Vend Fee inclusion in the turnover is concerned, the same is governed by the unreported decision of this Court dated 19.9.2013 in T.C.(R)No.637 of 2006 etc. batch and hence the first question raised in T.C.(R)No.1669 of 2008 stands answered in favour of the assessee; consequently, question Nos.2 and 3, namely, levy of penalty under Section 12(3) and under Section 12(5)(iii) of the Tamil Nadu General Sales Tax Act does not arise. This is also the position as regards T.C.(R)Nos.1857 of 2008 and 13 of 2009 on the sustainability of Vend Fee. In the light of the decision we have taken in T.C.(R)No.1669 of 2008 following the decision dated 19.9.2013 in T.C.(R)No.637 of 2006, the question of levy of penalty on Vend Fee does not arise; consequently, penalty stands deleted. 12. This is also the position as regards T.C.(R)Nos.1857 of 2008 and 13 of 2009 on the sustainability of Vend Fee. In the light of the decision we have taken in T.C.(R)No.1669 of 2008 following the decision dated 19.9.2013 in T.C.(R)No.637 of 2006, the question of levy of penalty on Vend Fee does not arise; consequently, penalty stands deleted. 12. As regards the liability under Section 7A, which is a subject matter in all the four tax cases, as fairly submitted by the learned senior counsel appearing for the assessee, the same has to be answered against the assessee by following the decision of this Court reported in (2005) 139 STC 477 (Mohan Breweries and Distilleries Limited V. Commercial Tax Officer, Porur Assessment Circle, Chennai and others). In the circumstances, the order of the Tribunal stands confirmed on this issue. 13. As far as levy of penalty on this turnover is concerned, as rightly pointed out by the learned senior counsel appearing for the assessee the decision on the liability under Section 7A was considered in the decision reported in (2005) 139 STC 477 (Mohan Breweries and Distilleries Limited V. Commercial Tax Officer, Porur Assessment Circle, Chennai and others) on 10.9.2004 on the dispute raised based on the Commissioner's clarification, we do not find any justifiable ground to accept the plea of the Revenue that the facts of the case calls for imposition of penalty. Hence, applying the ratio of the decision reported in (2002) 125 STC 505 (Appollo Saline Pharmaceuticals (P) Limited V. Deputy Commercial Tax Officer and another) and taking note of the decision reported in (2005) 139 STC 477 (Mohan Breweries and Distilleries Limited V. Commercial Tax Officer, Porur Assessment Circle, Chennai and others), we have no hesitation in accepting the plea of the assessee; consequently, penalty levied on the turnover relating to Section 7-A stands deleted. Thus, the question raised in T.C.(R)Nos.1669, 1857, 1667 of 2008 and 13 of 2009 on the levy of penalty on purchase tax stands cancelled. 14. Thus, the question raised in T.C.(R)Nos.1669, 1857, 1667 of 2008 and 13 of 2009 on the levy of penalty on purchase tax stands cancelled. 14. As far as the penalty levied on account of the non-inclusion of excise duty in the turnover is concerned, we again accept the argument of the learned senior counsel appearing for the assessee that till the decision was rendered by this Court in (1990) 78 STC 461 dated 25th April, 1989 (Mohan Breweries and Distilleries Ltd. V. Commercial Tax Officer), the assessee acted on the basis of the various amendments that had come to the provisions of the Prohibition Act as well as the liquor vending rules and manufacturing rules and the arrangements made between the assessee, Tasmac and the Government as regards the liability of the assessee and with the bona fide dispute thus raised by the assessee as to the includability of the excise duty, we do not find any justifiable ground to accept the plea of the Revenue as to the absence of bona fides of its claim. 15. It may be seen that the dispute in this case was raised before this Court, as early as 1987-88. Thus with the dispute thus pending before this Court against the assessment orders under consideration, we do not find that the assessee could be mulcted with any liability of penalty levied under Section 12(3) or 12(5)(iii) of the Tamil Nadu General Sales Tax Act. Hence, applying the decision reported in (2002) 125 STC 505 (Appollo Saline Pharmaceuticals (P) Limited V. Commercial Tax Officer (FAC) and others), we hold that the facts of the case do not call for levy of penalty in this case. Consequently, the order of the Tribunal in so far as levy of penalty is concerned, the same stands deleted. So too, the levy of sales tax on Vend Fee paid by the wholesaler stands deleted. As regards Section 7A purchase tax is concerned, the same stands confirmed. Accordingly, the Tax Case (Revisions) are partly allowed. No costs. Consequently, M.P.No.1 of 2009 is closed.