2016 (1) TMI 144 - HC - VAT and Sales Tax

Detention of Goods at check post - supply of Pan Masala (without Tobacco and Nocotine) - According to the petitioner, the transaction has been effected after being CST charging tax @ 2% against C Form. - According to the learned counsel for the petitioner, though the goods were accompanied with proper documents, the 2nd respondent has passed the impugned order mechanically with no acceptable reason. - Held that - Admittedly, the goods are detained from 05.12.2015. Till date, tax has not been quantified. Hence, for the purpose of release of goods, the 2nd respondent is directed to quantify the tax to be paid by the petitioner in consultation with the assessing authority and intimate the same to the petitioner within a period of one week from today and on such payment being made by the petitioner, if the goods detained are not prohibitory in nature, the same are directed to be released forthwith. As far as the compounding fee is concerned, it is open to the petitioner to adjudicate the same in the manner known to law. - petition is disposed of.

Summary

Issues:
Challenge to Goods Detention Notice under Article 226 of the Constitution of India.

Analysis:
The petitioner, a registered dealer, challenged a Goods Detention Notice and a corrected Notice as illegal and against the provisions of the Act. The petitioner had placed an indent for Pan Masala and the goods were supplied with valid documents. However, the vehicle was stopped for verification by the 2nd respondent, who issued a Goods Detention Notice and later a corrected notice, citing issues with the E-Sugam Forms. The petitioner contended that the detention was illegal as all valid documents were provided for an interstate purchase. The petitioner sought the release of goods.

The counsel for the petitioner argued that the 2nd respondent failed to follow the provision for release of goods on payment of tax and detained the goods without valid reasons. The delay in releasing the goods was causing harm to the consignee's business. The petitioner expressed willingness to pay the tax and requested the release of goods, with the compounding fee to be adjudicated later.

The Additional Government Pleader submitted that the 2nd respondent should quantify the tax to be paid by the petitioner for the release of goods. The Court considered the submissions and directed the 2nd respondent to quantify the tax to be paid within a week in consultation with the assessing authority. Upon payment by the petitioner, non-prohibitory goods were to be released immediately. The petitioner was given the liberty to adjudicate the compounding fee as per the law. The writ petition was disposed of with these directions, and no costs were awarded.