2007 (10) TMI 595 - HC - VAT and Sales Tax

Seizure order under section 13A(6) of the U. P. Trade Tax Act, 1948 - Held that - On the application under the proviso of section 13A(6) of the Act, the seizures were held illegal and the goods have been directed to be released without any security. Thus the seizure of the goods is patently illegal and without jurisdiction and liable to be set aside. We are of the view that the respondent is repeatedly seizing the goods contrary to the provision of the Act to harass the petitioner. W.P.allowed.

Summary

Issues:
Challenge to seizure order under U.P. Trade Tax Act, 1948 based on section 13A(6) - Goods seized during transit - Dispute over stock transfer vs. inter-State sales - Proper accounting in books of account - Legal basis for seizure - Jurisdictional validity of seizure - Repeated seizures causing harassment to petitioner.

Analysis:
The petitioner challenged a seizure order under the U.P. Trade Tax Act, 1948, concerning the dispatch of goods for stock transfer. The petitioner, a registered dealer, dispatched goods to its depot, but the vehicle was intercepted, and goods were seized for lack of proper documentation under the Mandi Adhiniyam. The petitioner contended that the goods were traceable, accounted for in the books of account, and not subject to inter-State sales tax evasion. The authority found the transaction dubious, justifying the seizure.

The High Court analyzed section 13A(1A) of the Act, emphasizing that goods can be seized if not properly accounted for in the dealer's records. In this case, the seizure was solely due to missing Mandi Adhiniyam documents, not inadequate bookkeeping. The petitioner had submitted stock registers with entries and claimed prior notification via email, unrefuted in the counter-affidavit. Previous illegal seizures on similar grounds were highlighted.

The Court deemed the seizure unlawful and beyond jurisdiction, noting the respondent's repetitive seizures as harassment. While acknowledging the statutory appeal process, the Court proceeded to quash the seizure order, directing immediate release of the goods. The judgment emphasized the absence of disputed facts, the order's legal flaws, and the need to prevent abuse of power through repeated seizures.

In conclusion, the High Court allowed the writ petition, setting aside the seizure order and instructing prompt release of the goods. The judgment underscored the importance of legal compliance, proper justification for seizures, and prevention of arbitrary actions causing undue hardship to the petitioner.