2015 (8) TMI 253 - HC - VAT and Sales Tax

Detention of goods - Non availability of goods vehicle record - Held that - It is an admitted case of movement of goods without any document like KK Form, Invoice and e-transit pass - a reading of the impugned order clearly shows that even the goods vehicle record was also not available with the driver. Therefore, rightly, the Deputy Commercial Tax Officer, Roving Squad III, Enforcement (North), has detained the goods. Hence, if the petitioner comes forward with an option of payment of one time tax and seeks for release of goods, the same may be directed to be considered by the respondent. Further, according to him, as far as compounding of offence is concerned, if the petitioner is so aggrieved, it is for him to work out his remedy in accordance with law. - petitioner readily agreeing for the said proposition made by the learned Additional Government Pleader (Taxes) appearing for the respondent, submitted before this Court that the petitioner is prepared to pay one time tax, even tomorrow and he would be contesting the matter with regard to compounding of offence, as the transaction was genuine. - Petition disposed of.

Summary

Issues:
Challenge to notice under Section 69 of the Tamil Nadu Value Added Tax Act, 2006 for carrying goods without valid documents.

Analysis:
The writ petition was filed challenging a notice issued under Section 69 of the Tamil Nadu Value Added Tax Act, 2006. The notice was based on the driver of the vehicle failing to have the necessary documents like Goods Vehicle record, trip sheet, and Lorry Receipt during the transport of goods. The Deputy Commercial Tax Officer concluded that the imported goods were carried without a valid document, leading to unloading at an unregistered place of business. The notice demanded payment of tax and a compounding fee within a specified period failing which further action would be initiated.

The petitioner argued that at the time of detention, the invoice was being prepared as they were waiting for an assessed bill of entry from the Customs Department. They claimed no intention to evade VAT as the transaction was genuine and the advance payment was received through bank channels. The petitioner, engaged in the paper business, imported goods and sold them to another company. However, the goods were detained as they were unloaded at an unregistered place instead of the petitioner's designated location.

The petitioner contended that after intercepting goods, the tax status should have been verified before detention, as per Section 67(4) of the Act. They criticized the respondent for compelling them to compound the offense without providing any option. The respondent, however, justified the detention citing the absence of required documents during the movement of goods and suggested the option of one-time tax payment for the release of goods.

Both parties eventually agreed that the petitioner would pay the one-time tax but reserved the right to contest the compounding of the offense based on the genuineness of the transaction. The court directed the release of goods upon payment of the tax amount. The petitioner was advised to pursue legal remedies regarding the compounding of the offense if necessary.

In conclusion, the writ petition was disposed of with the direction to release the goods upon payment of the specified tax amount. The issue of compounding the offense was left for the petitioner to address through appropriate legal channels.