2005 (1) TMI 708 - HC - VAT and Sales Tax

Summary

Issues: Revision under Section 11 of U.P. Trade Tax Act against Tribunal's order relating to Assessment Year 2004-2005.

Analysis:
1. Applicant's Business Operations: The applicant, a Company under the Indian Companies Act, 1956, engaged in the business of Mobile phone handsets under the trade name "Nokia." It received goods at its Noida Branch from other Branches via stock transfer and dispatched 4780 handsets to Lucknow. The consignment included 1600 handsets of a specific model.

2. Seizure of Goods: The Trade Tax Officer at Vijaynagar Check Post detained the goods during transit, citing a discrepancy in the code numbers mentioned in the invoice and on the handsets. The officer issued a show cause notice and seized 1500 handsets, demanding security for release. The applicant explained that the code number difference was internal and did not affect the goods' legitimacy as per the invoice.

3. Tribunal's Decision: The Tribunal rejected the applicant's appeal, upholding the seizure. However, the High Court found the seizure illegal. It noted that all 1500 handsets were covered by the invoice, with no model differences found during verification. The presence of an OC stamp on the invoice corroborated the consignment's movement from Noida to Lucknow. The Court emphasized that the code number variance did not invalidate the invoice's coverage, as it was an internal identifier. The Court deemed the seizure baseless, as no material evidence supported the assumption that the goods' origin was Delhi, not Noida.

4. Judgment and Relief: The High Court allowed the revision, quashing the Tribunal's order and the goods' seizure. It directed the immediate release of the goods without any security payment, assessing costs at Rs. One thousand. The Court concluded that the seizure was unjustified, emphasizing the legality and warrant for setting it aside based on the lack of substantial grounds for the action taken.

This detailed analysis of the judgment highlights the legal proceedings, the reasoning behind the decision, and the relief granted by the High Court in response to the issues raised in the revision under the U.P. Trade Tax Act.