1990 (11) TMI 390 - AT - VAT and Sales Tax

Issues Involved:
1. Legality and validity of seizure of goods.
2. Imposition of penalty.
3. Definition and applicability of "person" under the 1954 Act.
4. Alleged intention to evade tax.
5. Validity of permits obtained post-seizure.
6. Opportunity for drivers to produce permits.
7. Constitutionality of sections 4-B, 14-A, and 14-D of the 1941 Act and related rules.

Detailed Analysis:

1. Legality and Validity of Seizure of Goods:
The principal question raised was the legality and validity of the seizure of goods on November 10, 1986, and the consequent imposition of penalty. The applicant-company, a transporter of goods, had its goods seized at the Duburdihi check post near Asansol because the drivers could not produce the requisite permit. The respondents argued that the seizure was justified as the drivers failed to produce any permit covering the consignments, which was a violation of section 6 of the 1954 Act.

2. Imposition of Penalty:
The applicant contended that the penalty imposed was wrongful and illegal because the necessary permits were produced immediately upon receipt. However, the respondents maintained that the permits obtained long after the seizure did not mitigate the violation of law. The Tribunal upheld the penalty, stating that the delayed production of permits did not amount to compliance with the conditions.

3. Definition and Applicability of "Person" under the 1954 Act:
The applicant argued that the expression "person" in section 6 of the 1954 Act did not include a juridical person like a company. However, the Tribunal referred to the Bengal General Clauses Act, 1899, which defines "person" to include any company or association. Thus, the applicant-company was considered a person within the meaning of sections 2(b) and 7(2) of the West Bengal Sales Tax Act, 1954.

4. Alleged Intention to Evade Tax:
The applicant claimed that there was no intention to evade tax and that the drivers violated instructions to wait for permits at the West Bengal border. The Tribunal found that the applicant failed to substantiate these assertions with evidence. Mere assertions without proof were not sufficient to support the claim.

5. Validity of Permits Obtained Post-Seizure:
The applicant argued that the permits obtained after the seizure should not have been rejected. The respondents countered that the permits were obtained with the knowledge of the seizure, which was not disclosed to the issuing officer. The Tribunal agreed with the respondents, stating that the delayed production of permits did not mitigate the violation of law and upheld the rejection of the permits.

6. Opportunity for Drivers to Produce Permits:
The applicant contended that no opportunity was given to the drivers to produce permits within a reasonable time. The Tribunal found that there was no case of the applicant seeking such an opportunity and being refused. Since the permits had not even been applied for until after the seizure, the question of giving an opportunity to produce permits was deemed irrelevant.

7. Constitutionality of Sections 4-B, 14-A, and 14-D of the 1941 Act and Related Rules:
The applicant initially challenged the constitutionality of these sections and rules as violative of articles 301, 304, and 269(1) of the Constitution of India. However, during the hearing, the applicant did not press or agitate these points. The Tribunal did not address this issue further as it was not argued.

Conclusion:
The Tribunal dismissed the application, rejecting all contentions made on behalf of the applicant. The seizure and imposition of penalty were upheld as valid, and the quantum of penalty was not reduced. The Tribunal found no reason to differ from its earlier judgment in a similar case, reaffirming the validity of the seizure due to the infraction of law. The application was dismissed with no order as to costs.

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