K. Bhaskaran, C.J.
1. The petitioner is stated to be a dealer in copra. In and by exhibit P3 order dated 30th November, 1976, the 1st respondent-Intelliengence Officer, Agricultural Income-tax and Sales Tax, Kasaragod levied a penalty of Rs. 3,905.70 which represented half the value of the copra found to have been not accounted for. Aggrieved by exhibit P3, a revision was filed ; and that is seen to have been disposed of by exhibit P6 order dated 3rd July, 1979 by the 3rd respondent, the Board of Revenue (Taxes), Trivandrum.
2. Sri P. A. Mohammed (T), the counsel for the petitioner, submitted that Section 28(8) of the Kerala General Sales Tax Act, 1963 (the 'Act') is ultra vires the Constitution inasmuch as the maximum penalty that the assessing authority was empowered to levy had been fixed at half the value of the goods not accounted for by the assessee. Section 28(8) of the Act reads as follows :
28. Power to order production of accounts and powers of entry, inspection, etc.:--....
(8) If any officer, while inspecting any place of business under Sub-section (2) or searching any place under Sub-section (3), finds therein any goods not accounted for by the dealer in his accounts and other records required under Section 27 to be kept and maintained by him, such officer may, after giving the dealer a reasonable opportunity of being heard, by order, direct the payment of a penalty, not exceeding fifty per cent of the value of the goods not accounted for, as may be fixed by such officer.
3. The submission made by the counsel for the petitioner is that entry 54 in List II of Schedule VII to the Constitution did not empower the State Legislature to make a provision of this nature in the Sales Tax Act. Entry 54 reads as follows :--
Taxes on the sale or purchase of goods other than newspapers, subject to the provisions of entry 92A of List I.
Entry 54, in our view, has to be read along with entry 64 in List II of Schedule VII to the Constitution which reads as follows :
Offences against laws with respect to any of the matters in this list.
4. We have absolutely no doubt that entry 54 and entry 64 in List II of Schedule VII to the Constitution give ample power to the State Legislature to make a provision in regard to the levy of penalty in relation to offences under the Sales Tax Laws; and there is absolutely no merit in the challenge raised against the constitutional validity of Section 28(8) of the Act.
5. Some decisions of the Rajasthan and Madras High Courts and one decision of the Supreme Court have been cited before us to press the contention that before the tax is levied, penalty could not be imposed. They were all cases where the penalty leviable was related to the tax that was imposable or imposed. In such cases it is only natural that before taxable event is identified and quantum of tax determined ; the penalty could not be levied. That is not the position under Section 28(8) of the Act ; to fix the penalty in terms of this provision at certain percentage of the value of the goods not accounted for by the assessee, determination of the tax is not only not a condition precedent, but also is not even a relevant factor.
6. In this view, we reject the contention of the counsel for the petitioner in spite of his persuasive arguments, that the provisions of Section 28(8) of the Sales Tax Act were beyond the legislative powers of the State Legislature.
7. It was then contended by the counsel for the petitioner that the levy was made in an arbitrary manner and therefore some reduction in the penalty was warranted. We do not think that in these proceedings we could go into a plea of this nature, considering the limited scope of jurisdiction under Article 226 of the Constitution.
8. The result, therefore, is that we dismiss the writ petition, however, without any order as to costs.