1979 (8) TMI 187 - HC - VAT and Sales Tax

Summary

Issues:
1. Alleged illegal seizure of books of account by the Commercial Tax Officer.
2. Authority of the respondent to retain the seized books beyond the permissible period.
3. Impact of subsequent law changes on the case.
4. Relief sought by the petitioner regarding the return of the books of account.

Analysis:
The petitioner alleged that the respondent Commercial Tax Officer visited the rice mill premises and indiscriminately collected books of account, which were not returned despite reminders. The petitioner approached the High Court under article 226 of the Constitution, claiming the seizure was illegal and that the respondent had no authority to retain the books beyond 30 days without written permission from higher authorities, as per the Karnataka Sales Tax Act, 1957. The respondent denied the allegations and asserted that the seizure was normal and legal. The court noted that some facts were undisputed and decided to focus on a legal question rather than the legality of the seizure based on the pleadings.

The court examined the law in force at the time of seizure, which mandated that seized accounts should not be retained for more than 30 days without permission from higher authorities. It was found that the Deputy Commissioner's permission to retain the books was obtained approximately 49 days after the seizure, rendering the retention beyond 30 days illegal. The government pleader argued that subsequent permission was granted and the law had been changed to allow a 60-day retention period. However, the court held that the subsequent law change was prospective and could not cure the illegality of the extended retention period. Consequently, the court ruled in favor of the petitioner, directing the immediate return of the books of account to enable compliance with legal requirements.

Given the petitioner's predicament of being unable to file returns without the account books, the court ordered the return of the books within a week. The petitioner was also directed to produce the books before the assessing authority if required. Additionally, the court awarded costs to the petitioner and communicated the order to the respondent. The petition was allowed, granting the relief sought by the petitioner.