2013 (2) TMI 332 - HC - VAT and Sales Tax

Detention of goods - appellant seeking release of the goods detained - TNVAT Act, 2006 - Held that - Section 67(4) of the TNVAT Act, 2006 provides for release of goods on payment of tax or the security either voluntarily or under protest. In such view of the matter, direction is issued to the respondents to release the goods forthwith if the tax is paid either voluntarily or under protest.

Summary

Issues: Challenge to goods detention notice and demand for compounding fee.

Analysis:
The petitioner filed a Writ Petition seeking a Writ of Certiorarified Mandamus to quash a detention order issued by the respondent and to direct the release of the detained goods. The detention notice dated 17.1.2013 was challenged, which also included a demand for a compounding fee. The petitioner's counsel mentioned that the petitioner's grievance would be resolved if the goods were released upon payment of tax under protest as per Section 67(4) of the TNVAT Act, 2006.

The Government Advocate (Tax) stated that the authority would consider releasing the goods under Section 67 of the Tamil Nadu Value Added Tax Act, 2006, upon payment of tax, and would then proceed regarding the compounding fee under Section 72 of the same Act. Referring to a previous case (W.P.No.30304 of 2012), where goods were released on payment of tax, the Court directed the respondent to release the goods immediately upon the petitioner's payment of the demanded tax under protest in accordance with Section 67 of the Act.

The Court disposed of the Writ Petition, instructing the release of goods upon payment of tax, while allowing the petitioner to contest the composition notice on its merits and as per the law. No costs were awarded in this judgment.