SAYAM ZAFAR Vs. A C S T

JUDGEMENT

(1.) THE petitioner No. 1 claims to be the partner of a business carried on under the trade name M/s. A.N.S. Impex at 166 Tiljala Road, Calcutta 700 046. He as partner of the aforesaid firm and the firm M/s. A.N.S. Impex have filed this application under Section 8 of the West Bengal Taxation Tribunal Act, 1987 challenging the legality and validity of a notice dated April 25, 2007 issued by the Assistant Commissioner of Sales Tax, Calcutta, South Circle (Audit Wing -II) asking Md. Nehal Zafar, a partner of the firm to show cause why a complaint would not be lodged under Section 93(6) and 93(7) of the West Bengal Value Added Tax Act, 2003 (hereinafter referred to as, "the VAT Act") with the police against the partners of the firm.

(2.) SECTION 43 of the VAT Act has provided for audit of the accounts, registers or documents including electronic records of the registered dealers selected on a random basis or upon information or otherwise. Rule 54 of the West Bengal Value Added Tax Rules, 2005 (in short, "the VAT Rules") provides that the audit as contemplated by Section 43 will be performed by the auditing authority as a team formed by the Commissioner of Sales Tax with the officers as mentioned in the said rule. In the present case the petitioner No. 2 firm was selected for audit of its accounts. Notice for audit under Sub -section (2) of Section 43 of the VAT Act was duly issued. In response to the said notice the partners of the petitioner No. 2 firm produced their records and documents before the audit team for the purpose of statutory audit. In course of audit, the audit team formed a prima facie impression that the partners of the firm produced incorrect documents knowingly in order to evade or avoid payment of tax.

(3.) MR . Ganguly, learned Advocate appearing for the petitioner has submitted that only the Commissioner of Sales Tax can lodge a complaint with the police but he has not been able to show any provisions in the VAT Act or the Rules framed thereunder to show that only the Commissioner has been empowered to lodge a complaint with the police. It is well -known that under the code of criminal procedure any person can report commission of a cognizable offence to the police. Regarding offences under the VAT Act, any officer of the Sales Tax Directorate can lodge a complaint with police after following the administrative procedure, if any, laid down for the purpose. Even assuming that consent or permission of the Commissioner or any other particular officer is required the proposal is to be initiated by the officer who has detected commission of an alleged offence. In the present case the Assistant Commissioner of Sales Tax, Calcutta, South Circle (Audit Wing -II) has formed a prima facie belief that the partners of the petitioner No. 2 firm have committed offences under Section 93(6) and 93(7) of the VAT Act. Before lodging any complaint with the police in accordance with the administrative procedure of the directorate or before reporting commission of the alleged offence to the appropriate authority for lodging complaint with the police the Assistant Commissioner wants to confirm his prima facie belief or opinion after giving an opportunity to the petitioner of placing their answers and comments, if any. There is no statutory requirement under the provisions of the VAT Act or the Rules framed thereunder for issuing such notice or giving such opportunity of hearing before taking steps for lodging complaint with the police. However, the concerned officers in the Sales Tax Directorate usually give such opportunity to the dealers for the benefit of the dealers so that they get an opportunity of explaining and removing the suspicion from the mind of the concerned officer. If the dealer so chooses or is so advised he can ignore the notice and may not avail of the opportunity given for his benefit. According to us there is no illegality or infirmity in giving an additional opportunity of hearing or showing cause. If the concerned dealer chooses not to respond to the notice and to appear before the concerned officer to place his answers or explanation the concerned officer will be free to proceed further in accordance with law and prescribed procedure, if any, for lodging complaint with the police.