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TMI Blog1985 (5) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... tax department searched the premises and found 178 account slips containing various transactions which no one present in the establishment could explain. It has been stated on affidavit, by Sri Swapan Chowdhury, an Inspector of Commercial Taxes, that he had reason to suspect that the petitioner was attempting to evade payment of sales tax under the Bengal Finance (Sales Tax) Act, 1941. The books and documents found in the business premises were seized. A seizure list was prepared and Sri Jaiswal put his signature on the said seizure list a copy of which was given to him. A separate report was prepared stating reasons for suspecting that the petitioner was evading sales tax. The report was also shown to Sri Jaiswal and his signature was obtained on the report. It has been stated in the affidavit by Sri Swapan Chowdhury that the report was prepared before the seizure of the documents and the preparation of the seizure list. The first contention raised in this case by the petitioner is that the search was unlawful. It has been argued that since the search was unlawful, the seizure of the books and documents was also unlawful and the respondents must be directed to forthwith return t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... information received, reason to believe that the dealer keeps or is for the time being keeping any accounts or registers, documents or records of his business or any stock of goods for sale." Sub-section (1) enables the Commissioner to require any dealer to produce before him any accounts, registers or documents or to furnish any information relating to the stock of goods or purchase and sale or delivery of goods. Subsection (2) casts an obligation upon a dealer to keep: (a) All accounts, registers and documents relating to the stock of goods or purchases, sales and deliveries of goods by any dealer and (b) to keep all accounts, registers and documents and also the goods open to inspection by the Commissioner. This sub-section cannot be interpreted to mean that only such accounts or such goods that the dealer chooses to keep in his place of business will be open to inspection by the Commissioner. In this case, the authorised officials entered the business premises of the petitioner lawfully and wanted to see the accounts which were not produced. There is no explanation by the petitioner either before the authorised officials or in the court why accounts and registers relating t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there is no power of search whatsoever in sub-section (2) because the sub-section in terms does not provide for search". In that case, it was emphasised by the Supreme Court that section 41(1) of the Madras Act required a dealer to produce its accounts, etc., and to furnish other information relating to his business. The legislature was, however, cognizance of the fact that a dealer may not produce all accounts or furnish all information even though required to do so under sub-section (1). Therefore, sub-section (2) provided that all accounts, etc., of the dealer would be open to inspection. The Supreme Court also observed at page 461: "Similarly, the officer has been given the power to inspect the goods in the possession of the dealer. He has also the power to enter the dealer's offices, etc., for the purpose of such inspection. Combining these two powers together it follows on the same reasoning that the officer has the power to search for the goods also and to inspect them if found in the offices of the dealer." Having regard to the principles laid down by the Supreme Court and also bearing in mind the scope of sub-sections (2) and (3) of section 14, I am of the view that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regard to the context of the Act. This means that all accounts, registers and documents and all goods kept in any place of business of any dealer will be open to inspection by the Commissioner whether produced by the dealer or not. If the dealer does not produce the accounts, registers and documents and other goods kept in the place of business before the Commissioner, it should be open to the Commissioner to find out those accounts, registers and documents and goods. In my opinion, power to search is inherent in the right to inspect all accounts, registers and documents and all goods kept in any place of business in section 14(2). If after inspection the Commissioner has reason to suspect that a dealer is attempting to evade payment of tax, he may seize such accounts, registers and documents as may be necessary after recording his reasons to suspect. In the case before us, the authorised officials went into the business premises of the dealer on 24th March, 1983 but could not find any relevant current books and documents. The only account book which was produced was for the period from 11th August, 1982 to 11th November, 1982. It has been recorded that "no cash book, ledger, bill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for inspection at all reasonable times by the Commissioner or an authorised official. Non-production of books of accounts of the business for inspection in violation of the statutes can only mean that the assessee is unwilling to produce those books of accounts for some reason of his own. In the absence of any explanation for such non-production, it will be reasonable to conclude that the dealer is unwilling to produce its business for inspection so that full particulars of purchase and sale may not be found out by the Commissioner. It has been recorded by the authorised official that he had reasons to believe that the dealer was evading payment of taxes. In the facts of this case it cannot be held that there was no material for the formation of such belief. In this context, it should also be borne in mind that the impugned search and seizure took place on 24th March, 1983, and the writ petition was moved on 2nd July, 1984. No explanation has been given for the delay. It has been stated on behalf of the petitioner, however, that he has been compelled to file this writ petition because of the unwillingness of the respondents to issue declaration forms in accordance with law and thi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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