1999 (8) TMI 937 - HC - VAT and Sales Tax

Summary

Issues:
1. Seizure of goods and demand of security under section 13-A(6) of the U.P. Trade Tax Act, 1948.

Analysis:
The judgment involves six revision petitions challenging a common order passed by the Trade Tax Tribunal, Ghaziabad, which upheld the seizure of goods and the demand of security under section 13-A(6) of the U.P. Trade Tax Act, 1948. The facts revolve around six trucks loaded with C.R. coils parked near the U.P. border, where the Trade Tax Officer found the drivers had no papers for the goods. The revisionist claimed to have ordered the goods from Delhi parties, but due to personal reasons, could not provide necessary documentation. The department alleged the Delhi parties were fictitious and non-existent, leading to the seizure of goods and demand for security. The Assistant Commissioner and Tribunal upheld the seizure and security demand, prompting the revision petitions.

The revisionist argued that the delay in filing objections was due to personal circumstances, and the Delhi parties were genuine and registered with the Sales Tax department of Delhi. However, the court found discrepancies in the explanation provided. The court noted that substantial value consignments were ordered without proper documentation, raising suspicions. The court deemed the explanation unsatisfactory and upheld the seizure, emphasizing the need for detailed investigation during penalty proceedings.

Regarding the demand for security at 40% of the goods' value, the revisionist contended it was excessive. The court referred to a circular issued by the Commissioner but found it inapplicable due to the lack of documents with the drivers. The court considered the 40% security demand arbitrary, especially for goods taxable at 4%. The court deemed a 40% penalty unjustified, suggesting a 15% security deposit as sufficient. Consequently, the court partially allowed the revision petitions, affirming the seizure of goods but reducing the security demand to 15% of the goods' value.

In conclusion, the judgment addressed the issues of seizure of goods and the demand of security under the U.P. Trade Tax Act, 1948. It highlighted discrepancies in the revisionist's explanation, leading to the affirmation of the seizure. The court also deemed the 40% security demand excessive, reducing it to 15% of the goods' value.