CHALLA KISHTAIAH Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) This is a petition filed by one Challa Kishtaiah under section 491 of thc Criminal Procedure Code and Article 226 of the Constitution, challenging the legality and propriety of his arrest and imprisonment in pursuance of a warrant issued on 3rd September, 1965, by thc District Collector of Mahabubnagar under section 48 of the Andhra Pradesh Revenue Recovery Act (Madras Act II of 1864)- which will be referred to as " the Act," and seeking a writ or direction in the nature of habeas corpus for his release. The circumstances which led to the arrest of the petitioner, as stated in the counter-affidavit filed by the District Collector of Mahabubnagar, are the following: The petitioner, Challa Kishtaiah, was a registered dealer under the Andhra Pradesh General Sales Tax Act (hereinafter called the Sales Tax Act") and was carrying on business in kirana and foodgrains at Kosgi village under the name and style of M/s. Challa Ramaiah. On the basis of the returns submitted by the petitioner, assessments to sales tax were made by the concerned authority for the years 1956-57 to 1960-61. But, as a result in a Surpreme check conducted by the Special Commercial Tax Officer (Evanhas), Hyderabad North, on 18th June, 1962, forty-two books of secret accounts relating to the business done by the petitioner, were recovered. Those books revealed huge suppressions by the petitioner of the turnover for the years 1956-57 to 1960-61. On the basis of that incriminating material, the Special Commercial Tax Officer issued notices to the petitioner to show cause why the assessments made previously should not be reopened and revised and, after considering the petitioner's objections, revised assessments were made in respect of the escaped turnovers for the said years under section 14 (4) of the Sales Tax Act and penalties were levied at one-and-half times the tax. Thus the total amount payable by the petitioner was Rs. 2,48,734-09 nP.

(2.) The petitioner was duly served with the assessment orders and demand notices, in respect of the revised assessments. He did not choose to file any appeals against the assessment orders nor did he pay anything towards the revised assessments. Instead, he devised a scheme and adopted a course of conduct calculated to defeat and defraud the revenue. Soon after the secret account books were seized and even before the revised assessments were made, the petitioner began to alienate his properties situated in Kosgi village. Not content with that, he suddenly stopped doing business in 1962 itself, but in the same business premises the kirana business is being run in the name of G.Veeriah ; the paddy and rice business in the name of K. Sivappa and the Commission business in the name of B. Narasimhulu. These persons are all mere name-lenders and the petitioner himself is in fact running these businesses. Further, the petitioner owns two lorries, but they are not registered in his name. In paragraph 3 of this affidavit, the District Collector states : "All these fraudulent activities of the petitioner led me to believe that the petitioner is wilfully withholding payment of the arrears and a!so he has been guilty of fraudulent conduct in order to evade payment of tax."

(3.) The Collector also took note of the fact that the properties owned by the petitioner are too negligible to meet even a fraction of the dues payable by the petitioner. On being statisfied upon the materials placed before him by the sales tax authorities that this was a case of wilful and fraudulent non-payment of arrears of public revenue to the tune of about 2 lakhs of rupees, the Collector, acting under section 48 of the Act read with section 16 (4) of the Sales Tax Act, issued a warrant for the arrest of the petitioner and his confinement in the District Jail for a period of two years, unless sooner released by a subsequent order of the Collector. The arrest warrant was entrusted to the Deputy Superintendent of Police, Narayanapet, for execution. The petitioner was duly arrested and is now confined in the Central Jail, Musheerabad.