2003 (8) TMI 479 - HC - VAT and Sales Tax

Summary

Issues:
Issuance of a writ of certiorarified mandamus to quash the proceedings of the respondent dated August 16, 2003 and release detained vehicles.

Analysis:
The petitioner filed writ petitions seeking to quash the respondent's proceedings and release vehicles detained for alleged non-payment of entry tax. The petitioner, a granite quarry owner, purchased excavators and transported them to Madurai. The check-post officer detained the vehicles citing non-billing with TNGST and CST registration numbers and entry tax liability. The petitioner's representations for release were denied, leading to the present petitions.

The statutory provision under Section 42 of the TNGST Act empowers check-post officers to inspect goods in transit for tax compliance. The provision mandates release of goods if tax is paid or accounted for properly. However, in this case, the respondent detained the goods based on reasons not supported by the law. The impugned detention orders cited lack of registration numbers and entry tax liability as grounds, which were found legally unsustainable.

The court found that the petitioner was a registered dealer under TNGST and CST, making the first ground for detention invalid. Regarding the second ground, the court held that the Entry Tax Act, 1990 is distinct from the TNGST Act, and detention under the former requires specific compliance procedures not met in this case. The petitioner argued that the excavators were not liable for entry tax as they were not motor vehicles under the Act, supported by authorities under the Motor Vehicles Act.

The court emphasized that the dispute was not about the applicability of the Entry Tax Act but the legality of the detention orders. The respondent's failure to adhere to Section 42 of the TNGST Act rendered the detention orders illegal. Consequently, the court quashed the orders and directed the immediate release of the detained goods, cautioning authorities to act lawfully to avoid unwarranted harassment of the public.

In conclusion, the writ petitions were allowed, with no order as to costs, and the connected W.P.M.Ps were closed. The judgment highlighted the importance of lawful actions by authorities and the need for adherence to statutory provisions to prevent illegal actions and unwarranted harassment.