2017 (2) TMI 704 - HC - VAT and Sales Tax

Detention of goods - non-submission of Form JJ - Held that - the captioned writ petition is disposed of with a direction to the respondent to release, forthwith, the detained goods, upon payment of one time tax equivalent to a sum of ₹ 90,211/- - decided partly in favor of petitioner.

Summary

Issues Involved: Challenge to Goods Detention Notice and Compounding Notice

Analysis:
1. Challenge to Goods Detention Notice and Compounding Notice:
- The petitioner challenged the Goods Detention Notice and the consequential Compounding Notice dated 26.01.2017.
- The petitioner bought detained goods from Sunshine Tiles Company Private Limited in Gujarat and sold them locally to Geetha Home Decors.
- Local tax at 14.5% and central sales tax were paid on the transactions.
- The goods were detained for reasons including the absence of Advance Inward Way Bill and non-reporting of checkpost.
- The petitioner claimed inability to generate Form JJ due to delays by the consignor.
- The petitioner argued no tax evasion and that the transaction was an inter-state sale, hence not subject to local tax.
- One-time tax payment was proposed by the petitioner for the release of detained goods, reserving the right to challenge the tax imposition and compounding fee.
- The respondent agreed to release the goods upon payment of one-time tax of ?90,211, with the petitioner retaining the right to challenge the tax and penalty through appropriate legal means.

2. Disposition:
- The writ petition was allowed, subject to exceptions, and notice was issued to the respondent.
- The court directed the immediate release of detained goods upon payment of the one-time tax amount.
- The petitioner's rights and contentions, including the right to challenge tax imposition and penalties, were preserved.
- The petitioner was granted the liberty to seek appropriate legal remedies in accordance with the law.
- The pending application was closed without any costs imposed.