2011 (4) TMI 1262 - HC - VAT and Sales Tax

Whether, under the facts and circumstances of the case, the Commercial Tax Tribunal was legally justified in releasing the goods without depositing any amount of security overlooking the relevant dates of Madhya Pradesh Transport Department in form 6 as well as the other material available on record, i.e., challan accompanying with the goods? Held that - It may be pertinent to note that the owner of the vehicle, alleged Arvind Kumar son of Gauri Shanker of Lalitpur, has not come forward so far to claim ownership of the aforesaid vehicle. This itself is an indication that the defence that the vehicle was already sold in Madhya Pradesh is false. In this view of the matter, I am of the opinion that the Tribunal has manifestly erred in law in placing reliance on the documents which were not even in existence at the time of seizure, in holding Arvind Kumar to be the owner of the vehicle; the vehicle was not being brought in U.P., for sale; and accordingly directing its release without security. In favour of Revenue

Summary

Issues:
- Question of law regarding releasing goods without security based on relevant dates and documents.

Analysis:
The case involves a revision by the Revenue against the order of the Commercial Tax Tribunal releasing a detained three-wheeler vehicle without security. The vehicle was seized for not being accompanied by proper documents, with the suspicion of being brought into Uttar Pradesh for sale to evade taxes. The dealer's representation was rejected initially but set aside in a second appeal by the Tribunal.

The Revenue raised a legal question on the justification of releasing goods without security, considering the dates on documents from the Madhya Pradesh Transport Department and the accompanying challan. The Tribunal relied on documents produced during the representation, indicating temporary registration in another name and no intention for further sale in Uttar Pradesh.

The Tribunal's decision was based on the belief that the vehicle was not intended for sale in Uttar Pradesh, supported by documents provided during the representation. However, the High Court found errors in relying on documents not in existence at the time of seizure, such as insurance cover and temporary registration obtained after the incident. The Court also noted the absence of the vehicle owner's claim and deemed the defense of a prior sale in Madhya Pradesh as false.

Ultimately, the High Court ruled in favor of the Revenue, overturning the Tribunal's decision to release the vehicle without security. The Court emphasized the importance of considering the timing and authenticity of documents in such cases, highlighting discrepancies and lack of ownership claim as factors influencing the judgment.