UNITED POLYMER INDUSTRIES Vs. STATE OF PUNJAB

JUDGEMENT

(1.) This petition, inter alia, challenges notice dated March 21, 2004 (annexure P.4) of detention of goods at the check-post of Information Collection Centre (for short, "ICC") and notice dated March 23, 2004 (annexure P.6), for imposing penalty in respect of the said goods.

(2.) Case of the petitioner is that it is registered as a dealer under the provisions of the Punjab General Sales Tax Act, 1948 (for short, "the Act"). It is a consignment stockist of GAIL (India) Ltd., a Government of India undertaking. GAIL sends goods to the peti- tioner as consignment agent and tax for sale of the said goods is paid at the time of last sale in Punjab. In the past, when such goods passed through the ICC, no objection was ever raised and there was no question of making any attempt to evade tax. On March 18, 2004, goods were sent by GAIL. On March 21, 2004, when the goods reached the ICC, Ram Nagar (at the border of Punjab State), the driver of the vehicle produced challan-cum-stock transfer invoice duly issued by the GAIL and the goods receipt, wherein details of the goods were clearly mentioned. In spite of this, the detaining officer gave notice, annexure P.4, wherein it was mentioned that goods carried in the vehicle were covered by the vehicle receipt and the bill (challan-cum-stock transfer invoice). Reasons for suspicion mentioned are that the goods are being sent from GAIL India to United Polymer, whereas one firm cannot transfer the goods to other firm by way of stock transfer. On March 22, 2004, representative of the petitioner appeared before the detaining officer and in the written explanation submitted on March 26, 2004, agreement dated November 5, 2003 between GAIL India and the petitioner was also produced and it was submitted that there was no attempt to evade tax in any manner. It was also stated that the stock register, etc., were also being produced to verify transactions. Vide order dated April 9, 2004, penalty was imposed and bank guarantee which had been furnished by the petitioner for release of goods was sought to be encashed. It is stated that before encashing the bank guarantee, copy of the order of penalty was not supplied to the petitioner nor any demand notice was served.

(3.) In reply, it is stated that pro forma of bill/stock transfer invoice created suspicion in the mind of the detaining officer as names of the consignor and consignee were different. It is further stated that supply of copy of order imposing penalty was not required before encashing the bank guarantee. It is further stated that since appeal was provided against order of penalty, matter could not be gone into in the writ petition. Basis of order imposing penalty is that the petitioner was not registered as a branch of GAIL India and, therefore, there could be no stock transfer.