VINODAN Vs. STATE OF KERALA

JUDGEMENT

(1.) The petitioner is doing business in coconuts at Mahe, Pondicherry State. He is a registered dealer at Pondicherry, Exts. P1 and P2 are Certificates of Registration under the Pondicherry General Sales Tax Act and Central Sales Tax Rules respectively. His turnover was determined by the Mahe authorities as evidenced by Ext. P3. He used to purchase coconuts from Mahe and send them to outside the State in lorry loads. He did so on 20-3-1982. The sale bill and delivery note accompanied the transport (Exts. P4 and P5). The Intelligence Officer, Sales fax Department suspected the genuineness of the transport and in exercise of the powers vested in him under S.29A of the Kerala General Sales Tax Act and R.35A of the Kerala General Sales Tax Rules initiated proceedings, evidenced by Exts. P10 to P12. The petitioner, offered security, evidenced by Exts. P13 to P15. In this Original Petition the petitioner assails Exts.10, P11 and P12 proceedings. He contends that S.29A of the Kerala General Sales Tax Act and also R.35A of the Kerala General Sales Tax Rules are unconstitutional, void and inoperative. There is a prayer to quash Exts. P10, P11 and P12. Other reliefs are also prayed for;

(2.) The respondents have filed a detailed counter affidavit dated 3rd December, 1983. It is stated that as a result of the investigations made by the department, it came to light that pepper, ginger, coconuts etc. taxable at the last purchase point in this State, really purchased by a few persons like the petitioner at Tellicherry, in Kerala State, were transported across the State, in the name of fictitious or other persons in whose names certificates of registration were obtained at Mahe, so as to make it appear that the goods were purchased at Mahe and were being transported across the State. These were investigated and few cases were brought to book, when such clandestine transports were attempted. OP. Nos. 809/73, 546/73, 547/73 and 538/72 filed by such persons impugning the action taken by the Intelligence Officers of this State, in intercepting of goods and proceeding further under the Kerala General Sales Tax Act were dismissed by this court. S.29A as well as R.35A are valid. It has been so held by a Division Bench of this court. The reasons stated to assail the aforesaid provisions of law and also Exts. P10, P11 and P12 are without substance. The Original Petition has no merits and deserves to be dismissed.

(3.) It is common ground that a Division Bench of this court in the decision reported in Aboobacker v. State of Kerala (1979-44 STC 250) upheld the validity of S.29-A of the Act and R.35A of the Rules Counsel for the petitioner, Mr. P.A. Mohammed, contended that certain aspects were not properly considered in the said decision and so the said decision requires reconsideration. Petitioner's counsel raised the following points:-(a) The power to seize is not incidental or ancillary to the power to levy tax on sale or purchase of goods, which alone is authorised under Schedule.7, List II, entry 54. (b) The validity of S.29 of the Kerala General Sales Tax Act which is of similar import, came up before this court for consideration in Yogesh Trading Co. v. Intelligence Officer of Sales Tax ( 1970 KLT 154 FB ) : (26 STC 46). This court held that S.29(4) and (5) and R.35(5) to (12) & (15) are violative of Art.19(1)(f) & (g) and Art.301 of the Constitution of India. The State has filed an appeal before the Supreme Court from the aforesaid decision of this court. It is pending. The statement of objects and reasons to the introduction of S.29A shows that the new provision was enacted since in the appeal filed from the decision in Yogesh Trading Company case (1970 KLT 154 (FB)), the Supreme Court did not grant stay. So, S.29A is a colourable piece of legislation, (c) On the facts of this case, on a perusal of Exts. P1 and P2 (Registration Certificates obtained at Pondicherry by the petitioner) and Ext. P3 assessment order, it will be evident that the transport of the goods is bona fide and genuine and also inter state in character and so S.29-A of the Act will not apply and so Exts. P10, P11 and P12 proceedings are without bona fides and unauthorised. I should state that the above contentions are without force. In Aboobacker v. State of Kerala (44 STC 250) a Division Bench of this court exhaustively considered all aspects arising in the matter and upheld S.29-A of the Act and R.35-A of the Rules. There is substantial difference between S.29 which came up for consideration in Yogesh Trading Company case (1970 KLT 154 FB) and S.29-A of the Act which was considered in Aboobacker's case (44 STC 250). This difference was noticed by the court in the later decision (44 STC 250 at 258 & 260). It is too late in the day to contend that the power to seize the goods is not part of the incidental or ancillary power to levy sales tax and to check evasion of the same. See Commissioner of Commercial Taxes v. R.S.Uhaver (20 STC 453 (SC) at Page 468 & 469). As stated, S.29 and S.29-A are not of similar import. The language and import of the relevant provisions are materially different. The mere fact that one of the reasons stated for enacting S.29A of the Act is the failure to obtain stay in the appeal filed from Yogesh Trading Company case (1970 KLT 154 FB.), cannot render the new statutory provisions S.29A and R.35A, a "colourable piece of legislation." The validity of the legislative measure should be tested in the light of its competence to enact the law. The wisdom or the policy of the legislature in enacting the measure is not open to scrutiny by the court. S.29A and R.35A are altogether new provisions. Their scope and effect are altogether and materially different from the statutory provisions considered in Yogesh Trading Company case (1970 KLT 154). A bare perusal of the provisions themselves will disclose this aspect. The plea that S.29A and R.35A are "colourable piece of legislation", is without-any foundation. As to whether the transport of the goods is from Mahe, as stated by the petitioner, or it is a case where the petitioner purchased the goods inside the State and made it appear as if the goods are being transported from Mahe, itself is a matter for investigation. The petitioner and Revenue join issue on this basic fact. Whether in this case, the provisions of the Central Sales Tax Act will be attracted itself requires scrutiny and appraisal of very many facts and circumstances disclosed in the counter affidavit filed by the respondents. In these state of affairs, it is not necessary at this stage, and in these proceedings, to consider whether S.29A of the Act will apply in the case of inter state sales. The basic facts themselves are in dispute.