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TMI Blog1974 (1) TMI 98X X X X Extracts X X X X X X X X Extracts X X X X ..... said goods were seized by the authorities at the check-gate as per seizure lists bearing numbers 6 and 7 dated 23rd December, 1970 (annexures 1 and 1/a). The Assistant Sales Tax Officer attached to the check-gate issued a notice to the firm to show cause by 30th December, 1970, as to why the goods so seized may not be confiscated (annexure 2 series). On the appointed day, a representative of the firm appeared, showed cause and prayed for release of the goods. By notice dated 3rd February, 1971, the Assistant Sales Tax Officer directed the firm to furnish the names and addresses of the persons on whose behalf the seized goods were being carried and to furnish documents in support of such statement as may be made. On 7th February, 1971, compliance was effected. But, that day, the check-gate authority issued notice to the firm to show cause as to why penalty amounting to twice the tax chargeable in respect of the sale of the goods seized may not be imposed. On 10th February, 1971, cause was shown and jurisdiction of the Assistant Sales Tax Officer was disputed. On 16th February, 1971, the said authority passed an order for confiscation of the goods seized excepting a part thereof rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e person affected makes payment to such officer of the amount of tax payable in respect of such goods to be assessed in the prescribed manner, the goods seized as aforesaid shall be released: Provided also that no order of confiscation shall be made in respect of goods which are not liable to payment of tax. (4) If the goods which are seized or confiscated under sub-section (3) are of a perishable nature, they shall be sold in the prescribed manner." Rule 94 of the Rules makes detailed provisions relating to check posts and prescribes the form of the way-bill as also the detailed procedure of working out the requirements of section 16-A of the Act. 4.. The provisions for establishing check posts are now found almost in each of the States' Sales Tax Acts [see section 29 of the Andhra Pradesh General Sales Tax Act of 1957, section 41 of the Bihar Sales Tax Act of 1959, section 23-A of the Bengal Finance (Sales Tax) Act of 1941, as extended to the Union Territory of Delhi, section 29 of the Kerala General Sales Tax Act of 1963, section 29-A of the Madhya Pradesh General Sales Tax Act, 1958, section 42 of the Madras General Sales Tax Act of 1959, section 22-A of the Rajasthan Sales ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion as to whether the section makes provision for something ancillary and incidental to taxation of sales or goes beyond that limit. The Supreme Court in the case of Check Post Officer v. K.P. Abdulla and Bros.[1971] 27 S.T.C. 1 (S.C.).stated: ".......A taxing entry therefore confers power upon the legislature to legislate for matters ancillary or incidental including provisions for preventing evasion of tax. Sub-sections (1) and (2) of section 42 are intended to set up machinery for preventing evasion of sales tax. But, in our judgment, the power to confiscate goods carried in a vehicle cannot be said to be fairly and reasonably comprehended in the power to legislate in respect of taxes on sale or purchase of goods. By sub-section (3) the officer-in-charge of the check post or barrier has the power to seize and confiscate any goods which are being carried in any vehicle if they are not covered by the documents specified in the three sub-clauses. Sub-section (3) assumes that all goods carried in a vehicle near a check post are goods which have been sold within the State of Madras and in respect of which liability to pay sales tax has arisen, and authorises the Check Post Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e owner of the vehicle or boat as well as those of the consignor and the consignee of the goods. (3) The officer-in-charge of the check post or barrier, or the officer empowered as aforesaid shall have power to seize and confiscate any goods which are under transport by any vehicle or boat and are not covered by, (i) a bill of sale or delivery note, (ii) a goods vehicle record, a trip sheet or a log book, as the case may be, and (iii) such other documents as may be prescribed under sections 43 and 44: Provided that before ordering confiscation the officer shall give the person affected an opportunity of being heard and make an inquiry in the prescribed manner: Provided further that the officer ordering the confiscation shall give the person affected option to pay in lieu of confiscation- (a) in cases where the goods are taxable under this Act, in addition to the tax recoverable, a sum of money not exceeding one thousand rupees or double the amount of tax recoverable, whichever is greater; and (b) in other cases, a sum of money not exceeding one thousand rupees." The Supreme Court found that there was an unwarranted assumption in the provisions under the Madras Act t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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