9911796707
TMI Blog1990 (11) TMI 379X X X X Extracts X X X X X X X X Extracts X X X X ..... ripura. The Superintendent of Taxes, however, did not accept this statement and seized the lottery tickets, vide seizure list dated September 18, 1986. The seizure was made for the alleged contravention of the provisions of section 37(1) of the Tripura Sales Tax Act, 1976, hereinafter "the Act". The very next day, on September 19, 1986, the Superintendent of Taxes passed an order whereby the alleged offence of import of lottery tickets through Indian Airlines on September 18, 1986, under section 37(1) of the Act committed by the petitioner was compounded by him. It was done in lieu of taking action under section 29 of the Act. The sale value of the lottery tickets was computed at Rs. 50,000; tax payable at 20 per cent was determined at Rs. 10,000; composition money amounting to Rs. 20,000 was added thereto, and the petitioner was directed to deposit the said sum of Rs. 30,000 immediately. As this order is the subject-matter of challenge, and most of the contentions of the petitioner are based on the statements in this order, it is reproduced below: "ORDER 19-9-1986 During inquiry in the Agartala airport on September 18, 1986, it is found that Sri Kinkar Deb, s/o. Sri Sukumar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for release of the seized lottery tickets on the ground that they were perishable in nature as after expiry of the date of the draw, they would lose all their value. In that view of the matter, the Commissioner, by interim order dated September 22, 1986, directed release of the seized lottery tickets on furnishing a cash security of Rs. 30,000 by the petitioner. The petitioner deposited the same and got the lottery tickets released. Later, the Commissioner by order dated November 20, 1986, rejected the contentions of the petitioner and dismissed the revision petition. The Commissioner found that the petitioner opted for composition, but having found the amount calculated by the Superintendent of Taxes to be high, declined to compound. The Commissioner, however, was of the opinion that in such a situation, the Superintendent of Taxes was justified in passing the order of composition and enforcing payment thereof. It was held that the composition money had been calculated in accordance with the provisions of the Act and that the petitioner was legally bound to comply with the said composition order and to pay the tax and composition money amounting to Rs. 30,000 as determined by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g such quantities except in accordance with such conditions as may be prescribed. The main point for consideration in this regard is whether this requirement which applies to consignments of goods applies to personal baggage of a person also. For that purpose, it will be necessary to look at the scheme of section 37 and the relevant rules, namely, rules 45 to 48 which deal with the requirements that a person is required to fulfil before taking delivery of consignment from railway station, airport, etc. In the instant case, the admitted position is that the lottery tickets in question were not booked as consignment with the Indian Airlines but were carried with the petitioner as his personal baggage for which no consignment note, etc., is issued by the Indian Airlines. Incidental to this point will arise another point for consideration, namely, whether the authorities under the Act have got any power to stop a person at the airport, railway station, post-office, etc., and to check his baggage to verify whether he is carrying any taxable goods beyond the specified quantities with him. It will also have to be decided whether carrying taxable goods by any person from any other State to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e offence consists of failure to pay or evasion of any tax recoverable under the Act. In any other case, the maximum amount of composition money has been fixed at Rs. 1,000. It is also in addition to tax recoverable. From a careful reading of section 32, more particularly sub-section (2) thereof, it is abundantly clear that composition is not complete either with the offer made by a dealer to compound or acceptance thereof by the authority concerned. All these can only be termed as steps towards composition of an offence. The offer to pay a certain amount by way of composition money has to come from the person who has committed or is suspected to have committed an offence. He has to specify the amount that he is willing to pay by way of composition money. It is at that stage that the authority comes into the picture, because it has to decide whether to accept the offer or not to accept. If it decides not to accept the offer of the person concerned, on the ground that the amount offered is low, it may itself point out the amount that it is willing or prepared to accept and to that extent there is scope for negotiation between the authority and the person charged with the offence. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y can do is to forget all about the talk of composition and proceed with action under the law for the alleged commission of the offence. From the facts of the instant case, it appears that on the next day after the seizure, the petitioner, having been told of the provision of composition, expressed his desire to opt for the same, but on having been further told that he would be required to pay sales tax amounting to Rs. 10,000 on the value of the lottery tickets as well as composition money equal to double the said amount, i.e., Rs. 20,000, he refused to compound. According to the Commissioner, under such circumstances the officer was empowered to determine the amount of tax and composition money and direct payment of the same. The Commissioner has justified such action as being in accordance with section 32 of the Act. The petitioner has challenged this as contrary to the very scheme of composition contemplated by section 32 of the Act. We are inclined to agree with the petitioner. As already discussed above, the authorities have no power to impose composition. It is an option given to a person charges with an offence under the Act. It is not a power vested in the officer to imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 50,000. Evidently, no such tax was payable because by then the tickets had not been sold. It was not the case of the department that the petitioner had sold the lottery tickets and evaded payment of tax. The only allegation against him was that he imported lottery tickets in contravention of the requirement of section 37(1) of the Act, i.e., without fulfilling the procedure laid down in the said section and the rules framed thereunder. There was no question of levy of sales tax on the sale of tickets, which, to the full knowledge of the department, had not taken place as the tickets at that point of time were lying in the custody of the said authority itself. Sales tax under the Act being payable only on sales effected in the State, the stage had not come even to allege sale of lottery tickets or to seek to levy any sales tax thereon. This was not a case of evasion of sales tax. On the allegations made by respondent No. 2 itself, it was only a case of violation of the requirement of section 37(1) of the Act and the rules framed thereunder. This case, therefore, is one which falls under clause (b) of sub-section (1) of section 32 of the Act and the maximum composition money tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion (4) says that an offence under this section shall be bailable and cognizable. It is thus clear that the contravention of the provisions of sub-section (1) of section 37 is an offence punishable under sub-section (3) of section 37 and not under section 29 of the Act, as held by the Superintendent of Taxes and the Commissioner of Taxes. The next question for consideration is what is the scope and ambit of section 37 of the Act. Section 37 prohibits a person from taking delivery, or transporting from any railway station, airport, post-office, etc., any consignment of taxable goods exceeding such quantities and except in accordance with such conditions as may be prescribed. It reads: "37. Restriction on movement.-(1) No person shall take delivery or transport from any railway station, airport, post-office, or any other place whether of similar nature or otherwise, notified in this behalf by the State Government, any consignment of taxable goods exceeding such quantities and except in accordance with such conditions as may be prescribed. Such conditions shall be made with a view to ensure that there is no evasion of the tax imposed by this Act. (2) If the Commissioner ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atisfied about the correctness of the statement made and particulars contained in a declaration in form XVIII countersign the railway receipt, bill of lading or other documents and shall seal it with his official seal. Both copies of the declaration made by the dealer shall be endorsed with the number of railway receipt, bill of lading or other documents, as the case may be, and the date of countersignature of the aforesaid document and they shall be signed by the Superintendent or Inspector and sealed with his official seal. One copy of the declaration shall thereupon be returned to the dealer and the other copy retained by the Superintendent or Inspector. 47A............... 47B............... 48.. Notwithstanding anything contained in rule 45 the Superintendent of Taxes of any area or any Inspector specially authorised by him in writing in this behalf may for good and sufficient reason to be recorded in writing authorise any person to take delivery of or transport any consignment of taxable goods exceeding the quantities specified in the said rule 45 from the place in such area." The question that falls for determination is whether sub-section (1) of section 37 read with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in rules 46 and 47 of the Rules. Rule 46 requires a registered dealer, before taking delivery of any consignment of taxable goods exceeding the quantities specified in rule 45 from any place specified therein, to produce for countersignature before the Superintendent or Inspector "the railway receipt, bill of lading or other documents required for the purpose of obtaining delivery of such consignment from the carrier". Rule 46 provides that he is also required to make over a declaration in form XVIII giving the requisite particulars of the consignment, which include the name of the consignee, the name of the consignor, invoice number, railway receipt or bill of lading or air note number, etc. Rule 47 provides that the Superintendent or the Inspector shall on being satisfied about the particulars contained in the declaration, countersign the railway receipt, bill of lading or other documents and shall seal it with his official seal. Thereafter, the person concerned can take delivery of the goods. These are broadly the conditions on fulfilment of which the restriction imposed by section 37(1) is lifted and a person can take delivery of the consignment. From a careful scrutiny of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Even if on stretching the meaning of the word "consignment" or otherwise, "personal baggage" is held to be a consignment, then the question that arises for consideration is whether it is in any way possible for a passenger to fulfil the conditions laid down in rules 45 to 48. These requirements have been prescribed keeping in view the "consignment of goods" as ordinarily understood and not personal baggage. None of them apply to personal baggage. Nor can they be fulfilled in case of such baggage. There is no consignment note, etc., in case of such baggage nor there is any time-lag between arrival of goods and taking delivery thereof to enable any passenger to obtain any permission or clearance from any taxing authority before taking delivery thereof. In fact, personal baggage being personal baggage, question of taking delivery even does not arise. Some part of it, known as handbaggage, already remain with the passenger. The balance baggage is simply to be "collected". There is no "delivery" of the same as such. If section 37(1) is held to apply to personal baggage, then the conditions to be fulfilled in case of carriage of such goods shall have to be prescribed. From a reading ..... X X X X Extracts X X X X X X X X Extracts X X X X
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