DEVI DAYAL PRAG DUTT Vs. SALES TAX OFFICER

JUDGEMENT

(1.) This is a petition under article 226 of the Constitution of India challenging the orders dated June 6, 1985, passed by the Sales Tax Officer, levying a penalty of Rs. 19,440 under section 13-A (4) of the U. P. Sales Tax Act; an order dated September 16, 1985, passed by the Assistant Commissioner, Judicial, allowing the petitioner's appeal partly and reducing the penalty to Rs. 13,608 and the order dated September 26, 1989, passed by the Sales Tax Tribunal, Moradabad, dismissing the petitioner's second appeal. The petitioner is a trader situated at Calcutta. At about 9. 15 p. m. on March 27, 1985, the Sales Tax Officer, Mobile squad, Moradabad, intercepted the motor truck No. UPV-4866 belonging to Soudi Transport Company, Moradabad. On checking the same, it was found that it carried two containers of menthol about which no papers were available with the driver. The truck was detained and on the next day the manager of the transport company produced documents in respect of the two containers of menthol showing that those goods were purchased by the present petitioner from M/s. S. P. Chemicals, Lajpatnagar, Moradabad, through bill No. 5 dated March 27, 1985. The Sales Tax Officer doubted the genuineness of the documents and seized the goods which were released on depositing the amount of Rs. 19,440 as security. Later on penalty proceedings were initiated and the impugned orders were passed. The petitioner's case is that he has no place of business in the State of U. P. and therefore was not a dealer within the meaning of the U. P. Sales Tax Act and that no notice as required under section 13-A (3) was ever served on the petitioner. According to the petitioner the penalty if any should be levied on the dealer who had sold the goods and handed over the same to the transporter for onward transmission to the petitioner. The respondents have filed a counter-affidavit admitting the checking of the truck about 10 km. away from Moradabad. It is contended that the papers were produced on the next day at about 12 noon by one S. K. Sharma of the transport company who stated that by some mistake the papers were omitted to be delivered to the driver. It is alleged that the bill dated March 27, 1985, was issued by M/s. S. P. Chemicals, 99 Lajpatnagar, Moradabad. But it was of a suspicious character and the transport company could not produce the builty book. It was contended that the petitioner had stated in writing that the goods were purchased from M/s. S. P. Chemicals and were booked with the company and therefore it was clear that the petitioner had taken the delivery of goods and booked the same for transport. As is evident, it is admitted that the present petitioner had purchased the goods from one S. P. Chemicals of Moradabad. The orders of the authorities below show that no attempt whatsoever was made by the authorities concerned to find out whether the goods were duly recorded in the books of accounts of S. P. Chemicals or not. The dealer is not alleged to be engaged in the business of selling goods inside the State of U. P. Admittedly, the goods were on their way out from the State of U. P. The petitioner, being a purchaser only, was not liable to pay any tax under the U. P. Sales Tax Act and therefore cannot be said to have intended to avoid any tax. In the circumstances of the case, there was absolutely no justification for initiating penalty proceedings against a dealer of another State for the default of the transporter in not carrying the goods with proper documents. The authorities below have laid great stress on the fact that the papers were produced by the manager of the transport company 15 hours later, i. e. , at about 12 noon on March 28, 1985. This is not a delay worth even mentioning because the truck was detained 10 kms. away from the town at about 9. 30 p. m. and therefore documents could be produced only the next day after the office of the transporter opened. The fact that the transporter did not show his builty book could be used against the transporter and not against the present petitioner. The penalty under section 13-A (4) cannot be levied mechanically against the purchaser situated outside the State of Uttar Pradesh by absolving the selling dealers and transporters for their acts of commission and omission. I am therefore, of the view that there was no justification whatsoever, for initiating penalty proceedings against the petitioner and levying penalty under section 13-A (4) of the Act. The writ petition is accordingly allowed and the impugned orders referred to above and the penalty levied on the petitioner under section 13-A (4) of the U. P. Sales Tax Act are hereby quashed. The petitioner will get its cost of this writ petition which I assess at Rs. 2,000 (rupees two thousand only ). Writ petition allowed. .