A S NARAYANA Vs. STATE OF WEST BENGAL

JUDGEMENT

(1.) The validity of the constitution of the Bureau of Investigation (hereinafter referred to as the Bureau) set up by a notification dated 3rd February, 1970, issued by the Finance Department (Taxation), Government of West Bengal and the legality of the power of search and seizure exercised by some of the officers of the Bureau under the provisions of the Bengal Finance (Sales Tax) Act, 1941 (hereinafter referred to as the Act), have been challenged in this petition.

(2.) The facts which have given rise to the present dispute do not require an elaborate narration. The petitioner claims to be the proprietor of Spare Corporation and carries on business under the said name and style at 60, Beg Bagan Row, Calcutta. His business consists of the supplies of spare parts for heavy earthmoving equipments and machinery and automobiles. The petitioner is a registered dealer under the Act. It is stated that he had been carrying on his business since October, 1966 and had been submitting quarterly returns under the Act in the prescribed manner. Sri S.K. Chatterji, Commercial Tax Officercum-Investigating Officer of the Bureau, being respondent No. 4, by an order dated 3rd February, 1973, called upon the petitioner to produce all his books and papers for all unassessed periods. On 6th February, 1973, the petitioner appeared with the books of account before respondent No. 4, who noticed certain irregularities in the transactions recorded. Some books which were produced by the petitioner on that date were left at the office of respondent No. 4 for scrutiny. When the petitioner appeared on 13th February, 1973, Sri S.B. Ghatak, Inspector-cum-Investigator of the Bureau, seized the books of account left by the petitioner on the earlier date and a seizure receipt dated 13th February, 1973, was supplied to the petitioner. Thereafter, respondent No. 4 wrote a letter to the petitioner alleging that he was carrying on business from a clandestine place at 9, Lall Bazar Street, although the registration under the Act has been granted in respect of the place at 60, Beg Bagan Row. By the aforesaid letter the petitioner was requested to comply with certain requisition made in the said letter. The petitioner sent a reply on 9th April, 1973, the details of which are not necessary to be stated for the present purpose. As the books of account seized were not returned to the petitioner even after 21 days from the date of the seizure, the petitioner moved this application and obtained a rule nisi.

(3.) The learned counsel for the petitioner contends firstly, that the Bureau does not form any part of the organisation of the Commercial Tax Directorate which is under the administrative control of the Commissioner of Commercial Taxes. According to him, the constitution of the Bureau is not authorised by any statutory provision and by a mere notification issued by the Governor, the Bureau cannot be vested with any statutory power of levy and collection of tax under the Act. The learned counsel secondly submits that even assuming that the State Government has the power to constitute the Bureau by a notification, the officers of the Commercial Tax Directorate having been released from their respective posts in the said Directorate and having been deputed to serve the Bureau, have ceased to function as officers under the Act to assist the Commissioner of Commercial Taxes and, as such, none of the said officers, who have been so deputed have the competence and the jurisdiction to exercise any of the powers and duties under the Act. The learned counsel for the respondents submits that the State Government can in the exercise of its administrative power constitute the Bureau for facilitating the work of investigation in connection with evasion of sales tax. With regard to the second contention of the petitioner, the learned counsel submits that the officers of the Directorate, who are also functioning as officers of the Bureau, are still under the statutory control of the Commissioner of Commercial Taxes and still retain their statutory positions under the Act and have exercised their powers under the Act.