2016 (4) TMI 360 - HC - VAT and Sales Tax

Seeking direction to move the goods to its agent - Goods detained for non-production of transit pass as well as copies of invoices at the time of inspection - Manufacturer of liquor known as BARCADI - Goods transported from the State of Goa to the Union Territory of Pondy disclosing the seller and buyer and sufferance of Central Sales Tax at 2% - Held that - as per the submission of Department that if the petitioner produces relevant papers by which, the authority would be able to co-relate the entries available in the outer check post. Also if the petitioner is able to prove that they are taking away the goods outside the state and there is no tax liability in Tamilnadu, then the authority can only levy a sum of ₹ 2000/- for lapses. Therefore, taking in to consideration the same, the petitioner is directed to pay a sum of ₹ 2000/- (Rupees two thousand only) towards fine for the purpose of release of goods and on such payment along with necessary copies of documents, the goods shall be released forthwith. - Petition disposed of

Summary

Issues:
Challenge to impugned proceedings of the 1st respondent in Goods Detention Notice, Non-production of transit pass and copies of invoices during goods transportation, Arbitrary and illegal detention of goods, Opportunity of hearing not provided to petitioner, Failure to generate E-Transit pass, Tax liability in Tamilnadu, Direction to pay fine for release of goods, Revised compounding notice issued.

Analysis:
The petitioner, a manufacturer of liquor, challenged the impugned proceedings of the 1st respondent regarding the detention of goods due to non-production of transit pass and copies of invoices during transportation. The petitioner contended that apart from the technical violation of not generating the transit pass, there was no suspicion regarding the genuineness of the accompanying documents. The petitioner argued that the detention notice was arbitrary and illegal.

The petitioner's counsel argued that if an inquiry had been conducted and an opportunity for a hearing provided, the petitioner could have effectively represented its case. It was also contended that the failure to generate an E-Transit pass should not lead to the imposition of tax by deeming the goods to have been sold in Tamilnadu. The Additional Government Pleader, on instructions, stated that if the petitioner could provide relevant papers to correlate the entries at the outer check post and prove that the goods were being taken outside the state, a fine of Rs. 2000 would be levied for lapses.

The court directed the petitioner to pay a fine of Rs. 2000 for the release of goods and submit necessary documents. Upon payment of the fine and submission of required documents, the goods would be released immediately. It was also noted that a revised compounding notice had been issued, allowing the petitioner to address it in accordance with the law. The writ petition was disposed of with the above directions, and no costs were imposed. The connected M.P.No.1 of 2015 was closed as a result of the judgment.