1991 (3) TMI 353 - AT - VAT and Sales Tax

Summary

Issues:
Detention of consignment due to absence of transit permit | Legality of penalty imposed and subsequent reduction | Jurisdiction of Commercial Tax Officer to impose penalty on owner of goods | Challenge to detention of vehicle | Admissibility of admission regarding violation of Act and Rules

Detention of Consignment:
The case involved the detention of a consignment at a check-post due to the absence of a transit permit, even though the permit was later issued from the same check-post. The applicants argued that this detention was illegal and challenged the imposition of a penalty under section 14C of the Act. The respondents justified the detention based on the failure to produce the required declaration form at the check-post.

Legality of Penalty and Reduction:
The penalty imposed on the applicants was reduced from Rs. 30,000 to Rs. 25,000 in a revision by the respondent No. 3. The applicants contended that the provisions of section 14C of the Act were ultra vires the Constitution, violating Article 301. The Tribunal analyzed the regulatory measures under section 14C to prevent tax evasion on sales of imported goods in West Bengal.

Jurisdiction of Commercial Tax Officer:
The Tribunal examined the jurisdiction of the Commercial Tax Officer to impose penalties on the owner of the goods, as opposed to the transporter, as specified under section 14C of the Act. It was concluded that the officer had illegally assumed jurisdiction not vested in them, leading to the detention of the vehicle being deemed illegal.

Challenge to Detention of Vehicle:
The Tribunal considered the contention that the detention of the vehicle was illegal, especially when the driver had requested time to obtain the required transit permit, which was not granted. The lack of a specific requirement in the Act or Rules regarding the timing of obtaining the declaration form was highlighted.

Admissibility of Admission Regarding Violation:
The Tribunal addressed the admission made by the applicants regarding the violation of the Act and Rules during the revision process. It was clarified that an admission on a question of law does not bind the party, and the applicants were not debarred from challenging the detention of the vehicle based on the admission made during the revision.

Judgment:
The Tribunal allowed the application, setting aside the orders of detention, penalty imposition, and revision. The penalty amount deposited by the applicants was to be refunded. The judgment emphasized the importance of following the prescribed procedures and ensuring the legality of actions taken by tax authorities. The decision was unanimous among the Tribunal members.