KAMALKR SHARMA Vs. STATE OF ASSAM

JUDGEMENT

(1.) The writ petitioner who is a dealer registered under the provisions of the Assam General Sales Tax Act, 1993 (hereinafter referred to as the Act) in course of his normal business of sale and supply of 'Supari' had sent a total of 320 bags of Supari on 7.3.2003 to its consignment agents in Rajasthan by Truck No. RJ-07G-4874. The aforesaid goods while in transit were seized by the Inspector of Taxes of Barpeta Road and as it would be evident from the seizure memo dated 17.3.2003 the grounds of seizure were stated as follows:

(2.) Dr. A. K. Saraf, learned senior counsel appearing for the writ petitioner in support of the challenge made has placed before the Court the provisions of Section 44(5)(a), 44(3) and Section 46(2)(b) of the Act as the power to seize the goods of the petitioner as has been sought to be drawn from the aforesaid provisions of law. Pointing the aforesaid provisions of the Act, learned senior counsel has contended that the only provision of the Act which could have some nexus with the power of seizure and levy of penalty is to be found in Section 46(2)(b) and (c) of the Act. Reading the provisions of Section 46(2)(b) of the Act, learned counsel has contended that the power of seizure can be exercised only if the goods in question are found not properly accounted for or if the authority has reason to suspect that evasion of tax payable under the Act may take place in respect of the goods. Placing the provisions contained in sub-clause 2(c) of Section 46, learned counsel for the petitioner has contended that the power to impose penalty can be exercised after giving of a reasonable opportunity and only in situations where the carrier or the bailee of the goods fail to satisfy the concerned authority regarding the proper accounting of goods. According to Dr. Saraf, learned senior counsel for the petitioner, on a conjoint reading of Section 46(2)(b) and (c) of the Act, the power of seizure and the power to levy penalty must be understood to be confined to cases where the goods in question are not properly accounted for giving rise to a satisfaction or a reasonable suspicion in the authority that evasion of tax may take place. According to learned counsel for the petitioner, the details recorded in the seizure memo indicate the total quantity of the goods carried as well as variety thereof and the invoices/bills maintained indicate the total weight of the goods carried. In such a situation, seizure must be understood to have been made for the alleged failure to have the road challans countersigned by the Superintendent of Taxes as well as the failure of the assessee to fill up the dispatch notes, as mentioned. Yet in the order dated 20.3.2003 it has been mentioned that the goods are not found accounted for. Pointing out the contents of the order dated 20.3.2003 Dr. Saraf, learned senior counsel for the petitioner, has argued that the goods have been referred to as unaccounted for though the total volume of the goods i.e. 320 bags and the variety of the goods as Assam Chikni Supari have been clearly mentioned in the order dated 20.3.2003. The argument advanced, therefore, is that the goods having been accounted for by reference to the total quantity as well as the variety thereof, a mere dispute with regard to the prices mentioned in the bills/ invoices will not make the same unaccounted for. The necessary conditions precedent to the exercise of power of seizure and levy of penalty, therefore, according to learned counsel for the petitioner, is non-existent in the present case. Learned counsel has further argued that the other grounds mentioned in the seizure memo for taking the view that the goods were not accounted for i.e. that the road challans and despatch notes were not countersigned and filled up are not valid requirements of the law inasmuch as there is no provision in the Act which requires the road challans to be counter-signed and further this Court in a decision reported in (2002) 3 GLR 535 : 2003(1) GLT 396 (Bajrangpur Tea Company (P) Ltd. Vs. State of Assam and others) has held the requirement of Form 35 (Despatch Note) to be ultra vires the provisions of the Rules. In fact, in the said decision, the Rules permitting the authority to insist on Despath Notes have been struck down. On the aforesaid basis the eventual argument advanced is that the power of seizure and power to levy penalty has been exercised in a situation which is not contemplated by the Statute. In so far as the levy of tax by the impugned order dated 20.3.2003 is concerned, the argument advanced is that the statute nowhere contemplates levy of tax at the stage of seizure and therefore the levy of tax amounting to Rs. 1,3 5,168/- is plainly contrary to the provisions of the Act.

(3.) The Revenue has not filed any counter but the records in original have been placed before the Court including the verification note of the Inspector of Taxes on the basis of which the order dated 20.3.2003 has been passed. Mr. K. N. Choudhury, learned Addl. Advocate General, Assam appearin g for the State has contended that failure to mention the correct price of the items/goods in transit and a definite under-valuation of the sale price in the invoices must be construed by the Court to be an instance where the goods are not properly accounted for. According to the learned Additional Advocate General, merely because the quantity of the goods and the variety thereof is ascertainable, the same should not lead to an inference that the goods have been properly accounted for, unless the sale price thereof is also correctly mentioned in the invoices. As in the instant case the Supari in question was grossly under-valued disclosing an attempt at evasion of taxes, learned Additional Advocate General has contended that the power of seizure and imposition of penalty has been rightly and correctly exercised.