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2013 (6) TMI 542 - HC - VAT and Sales TaxPower to decide validity of Seizure of goods - release of goods on furnishing of security bond - held that - neither the Commissioner or the Officer Authorized not below the rank of Deputy Commissioner under Section 48(7) of the Act nor the Tribunal in appeal under Section 57(4) of the Act has the power to decide about the validity of the seizure order and consequently this court in revision also lacks jurisdiction in respect thereof. As far as the quantum of security demanded equivalent to twice the tax imposable, no error in such an order has been shown and such a direction being dependent upon the judicial discretion of the authorities/tribunal, no question of law in connection thereto arises leaving any scope for interference in the same in exercise of revisional jurisdiction. - Decided against the assessee.
Issues:
1. Validity of seizure order under U.P. Value Added Tax Act, 2008 and Central Sales Tax Act. 2. Applicability of Section 48(7) of the Act in determining the quantum of security demanded. 3. Jurisdiction of the Tribunal and High Court in adjudicating the validity of the seizure order. Issue 1: Validity of seizure order under U.P. Value Added Tax Act, 2008 and Central Sales Tax Act: The revisionist, a registered dealer under the U.P. Value Added Tax Act and Central Sales Tax Act, challenged the seizure of goods, betel nut, imported from Karnataka for manufacturing Pan Masala. The goods were detained and a cash security of Rs. 8,98,400 was demanded, equivalent to 40% of the estimated value of the goods. The Joint Commissioner rejected the revisionist's representation, leading to an appeal before the Commercial Tax Tribunal. The Tribunal modified the security amount but the revisionist was still unsatisfied, leading to the current revision. Issue 2: Applicability of Section 48(7) of the Act in determining the quantum of security demanded: Section 51 of the Act mandates the furnishing of a declaration and other documents for imported taxable goods. The Officer Authorized can detain goods if tax evasion is suspected. Section 48(7) allows for the imposition of a penalty not exceeding the amount sufficient to cover the penalty liable to be imposed. The proviso to Section 48(7) empowers the Commissioner to relax the security demanded for releasing goods. However, the Commissioner's authority does not extend to adjudicating the validity of the seizure. Issue 3: Jurisdiction of the Tribunal and High Court in adjudicating the validity of the seizure order: The Tribunal's jurisdiction under Section 57(4) of the Act is limited to directions for releasing goods on furnishing security, not the validity of the seizure order. The High Court, in revision, lacks jurisdiction to adjudicate the validity of the seizure order. The scope of Section 48(7) and appeals under it cannot be expanded to include determining the legality of the seizure order when not provided for by the statute. Therefore, the Tribunal and the High Court cannot examine the legality of the seizure order, focusing only on the security amount demanded. In conclusion, the High Court held that the revision challenging the validity of the seizure order was not maintainable. The Court clarified that neither the Commissioner nor the Tribunal has the power to decide on the validity of the seizure order. The revision lacked merit, and the Court dismissed it, allowing the revisionist to challenge the seizure order before the appropriate forum if desired.
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