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2016 (1) TMI 623 - HC - VAT and Sales TaxDetention of consignments - not obtaining a transit pass under TNVAT - goods which are imported from a foreign country and bound to be transported SEZ unit outside the State - The raw materials which are purchased on high seas and cleared through Chennai harbour are used in the manufacture of transformer tank, power and energy sector equipments and exported - Held that - At this juncture, the learned counsel for the petitioner would submit that the petitioner is willing to pay the actual tax to be paid for the purpose of release of goods and on such payment, the goods detained may be directed to be released. The petitioner is willing to pay one time tax and in order to give a quietus to the issue, for the purpose of release of goods, without prejudice to their right to agitate the issue with respect to tax as well as compounding fee before the assessing authority or the revisional authority in the manner known to law, on payment of one time tax viz., ₹ 5,70,000/-by the petitioner, the respondents, shall release the consignments in question forthwith. - Petition disposed of.
Issues involved:
Challenging goods detention notices and seeking release of detained consignments based on the TNVAT Act, 2006. Analysis: 1. Nature of Writ Petitions: The writ petitions challenge Goods Detention Notices dated 21.11.15 and a connected notice dated 24.11.15, seeking the release of detained consignments. The petitions are filed jointly as the issue and parties are common. 2. Background of the Petitioner: The petitioner company is engaged in manufacturing transformer tanks and power sector equipment. It operates from New Delhi and Andhra Pradesh, with a manufacturing unit in a Special Economic Zone (SEZ) enjoying exemption benefits. The company regularly imports materials through Chennai Port for manufacturing and export purposes. 3. Detention of Consignments: The petitioner purchased imported materials on high seas for manufacturing purposes. The goods were cleared through Chennai harbor and transported to the SEZ unit in Andhra Pradesh. The consignments were detained by authorities for not enclosing a Transit Pass in Form LL, as required under the TNVAT Act for VI Schedule goods. 4. Legal Arguments - Petitioner's Counsel: The petitioner's counsel argued that the detention was unjustified as the goods were imported for SEZ unit use and not for sale within the state. The failure to enclose a transit pass should not lead to revenue loss, especially since the petitioner rectified the issue promptly after detention. 5. Respondent's Argument: The Additional Government Pleader contended that non-compliance with TNVAT Act provisions made the petitioner liable for tax payment as per Section 70 of the Act, justifying the detention. 6. Resolution and Court Decision: The petitioner expressed willingness to pay the actual tax for the release of goods. The court, considering this, directed the release of consignments upon payment of a one-time tax of Rs. 5,70,000 by the petitioner. The order allowed for further recourse to challenge tax and compounding fee issues before relevant authorities. 7. Conclusion: The court disposed of the writ petitions without costs, instructing the release of detained consignments upon the petitioner's payment of the specified tax amount. The judgment aimed to resolve the immediate issue while preserving the petitioner's rights for future legal recourse on tax matters.
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