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TMI Blog2010 (3) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... West Bengal. Hence, with the making of the declaration, the appellant undertook the obligation to transit the consignment to the destination outside the State for which the proof was the countersigned copy of the declaration, appeal dismissed - Civil Appeal No. 2757 of 2010. - - - Dated:- 26-3-2010 - KAPADIA S.H. AND AFTAB ALAM JJ. P.N. Mishra, M. Chandrasekharan and Sunil Gupta, Senior Advocates (Ritesh Agrawal, Siddharth Sengar, Tara Chandra Sharma, Ms. Neelam Sharma, Pupesh Kumar, Amarjeet Singh, Jatin Zaveri and Ms. Vibha Narang, Advocates, with them) for the appearing Parties. -------------------------------------------------- The judgment of the court was delivered by S. H. KAPADIA J. Leave granted. Heard learned counsel on both sides. In this civil appeal arising out of a special leave petition, we are required to consider the scope and effect of section 68(3) of the West Bengal Sales Tax Act, 1994 ("the Act", for short) read with sub-rule (6) of rule 211A of the West Bengal Sales Tax Rules, 1995 ("the Rules", for short). On September 8, 2001, M/s. Sanman Trade Impex Private Limited, Mumbai, appointed the appellant as its customs house a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the movement of goods. He submitted that he was appointed by the importer only to get the documents cleared from the customs and port authorities and not for movement of goods for which it is the importer who appoints a transporter. Therefore, according to him, the notice was not maintainable in terms of section 68 of the Act. The appellant further submitted that he was not required to keep an endorsed copy of the said declaration. In this connection, reliance was placed on rule 211A(6) of the Rules. According to the appellant, under rule 211A(6) of the Rules, the endorsed copy had to be returned to the person transporting the goods for onward movement to its final destination. Hence, according to him, the show-cause notice was not maintainable. By order dated December 27, 2002, the Assistant Commissioner of Commercial Taxes imposed a penalty on the appellant for failure to produce the endorsed copy of the declaration in terms of rule 211A(6) of the Rules. Being aggrieved by the order, the appellant preferred a revision before the West Bengal Taxation Tribunal, which application stood rejected. The decision of the West Bengal Taxation Tribunal has been upheld by the High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... possession of such goods, after giving such person or owner, as the case may be, a reasonable opportunity of being heard, a penalty of a sum not exceeding fifty percentum of the value of such goods as may be determined by him in accordance with the rules made under this Act: Provided that the sum of penalty that may be imposed under this sub-section shall not exceed (a) thirty percentum of the value of goods if the rate of tax leviable under sub-section (1) of section 17, or sub-section (1) of section 18, or sub-section (1) of section 20, in respect of such goods does not exceed ten percentum; (b) fifty percentum of the value of goods if the rate of tax leviable under sub-section (1) of section 17, or sub-section (1) of section 18, in respect of such goods exceeds ten percentum. (2) A penalty imposed under sub-section (1) shall be paid by the person or the owner of goods, as the case may be, into a Government Treasury or the Reserve Bank of India by such date as may be specified by the Commissioner or the Additional Commissioner in a notice to be issued for this purpose, and the date so specified shall not be earlier than fifteen days from the date of the notice: Provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch conditions and restrictions as may be prescribed, intercept at any place, other than those referred to in sub-section (2) and sub-section (4), within West Bengal any goods vehicle and require the transporter to produce before him the declaration and other documents referred to in sub-section (2) and search such goods vehicle for verification of the goods with the declaration and other documents produced, if any, by the transporter. (6) Where the Commissioner or the other authority referred to in sub-section (5) is satisfied, for reasons to be recorded in writing, that the transporter has contravened the provisions of this section, he may, after giving the transporter a reasonable opportunity of being heard, impose, by an order to be passed in the prescribed manner, such penalty, not exceeding twenty-five percentum of the value of the goods so transported, as may be determined by him in accordance with the rules made under this Act. 73.. Measures to prevent evasion of tax on sales within West Bengal. (1) Where a transporter carries from any place in West Bengal in a goods vehicle any consignment of goods and such vehicle is bound for any place outside West Bengal, he shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rting such consignment of goods to its destination outside West Bengal; (5) the said goods shall not be, either wholly or partly, unloaded, delivered or sold in West Bengal; (6) the statements in this declaration are true to the best of my knowledge and belief; I am furnishing hereunder the particulars/information relating to the said consignment: (a) name, address and sales tax registration No., if any, of the consignor outside West Bengal: (b) railway receipt/bill of lading/air-consignment note/ postal receipt No. and the date thereof: (c) invoice No. and date: (d) description of each commodity of the consignment: (e) quantity/weight of each commodity in the consignment: (f) value of the consignment with custom duty, freight, etc.: (g) name, address and sales tax registration No. of the consignee outside West Bengal: (h) name, address, licence No. and telephone No. of the clearing and forwarding agent, if any, in West Bengal who is handling the consignment on behalf of the consignee: (i) mode of transportation of the consignment to the destination outside West Bengal after taking delivery (j) registration No. of the road vehicle if such good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be countersigned with his office seal by such authority and the two countersigned copies of such declaration shall be returned to the person referred to in sub-rule (1). (5) For the purpose of section 69, the person referred to in sub-rule (1) shall, while transporting any consignment of goods on its way to destination outside West Bengal, stop his vehicles on being asked by such Assistant Commissioner or Commercial Tax Officer as the Commissioner may authorise in this behalf, at any place and present before him, on demand, the countersigned copies of the declaration referred to in the said sub-rule along with invoice, consignment note, road challan or any other document of like nature. (6) The two copies of the declaration duly countersigned under sub-rule (4) shall be produced before the Assistant Commissioner, Commercial Tax Officer or Assistant Commercial Tax Officer posted at the exit check-post and such authority shall, on being satisfied upon verification of the goods being transported with those specified in such declaration, endorse such declaration, retain one copy of such endorsed declaration and return the other copy of it to the person transporting such goods for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng agent, a transporter or any person who makes a declaration in the prescribed manner. Therefore, sub-section (3) is not confined to a transporter, as is sought to be argued on behalf of the appellant. Secondly, sub-section (3) indicates that any consignment of goods may be transported by any person after he furnishes particulars in the prescribed form. In this connection, we may refer to rule 211A of the Rules. The said rule occurs in Chapter XV of the Rules, which deals with restrictions on transport of any consignment of goods, regulatory measures for movement of such goods in transit through West Bengal, interception, search, seizure and penalty for contravention, and certain measures to prevent evasion of tax on sales within West Bengal. If one reads Chapter VIII of the Act with Chapter XV of the Rules, one finds that both Chapters deal with regulatory measures to avoid tax evasion. Therefore, in our view, the machinery provisions under the Act constitute an integral part of the charging provisions. These regulatory measures are intended to ensure that there is no evasion of tax. Therefore, one cannot read the Act by segregating the machinery provisions from the charging prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person taking delivery of the consignment. This obligation is imposed on the declarant so that, in the event of detection of tax evasion, it would not be open to the declarant to deny his liability which, in our opinion, under the scheme of the Act is an absolute liability in the sense that if the declarant commits breach of his obligation under the Act read with the Rules, then a legal presumption is drawn against him, of course, subject to rebuttal. It is important to note, in this connection, that the appellant in this case was the declarant. He had appended his signature on the declaration prescribed under rule 211A(1) of the Rules. At this stage, we may point out that, under the procedure prescribed in the Rules, the declarant, before taking delivery of the goods from the port, has to make a declaration in the prescribed form in which he undertakes unequivocally to transport such consignment to its destination outside the State of West Bengal. With such declaration, the appellant becomes liable for a breach if he fails to produce the counter-signed copy of the declaration before the assessing authority. The declaration is in triplicate. One copy duly endorsed remains with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch vehicle, who transports the goods on account of any other person or on his own account and, therefore, the said provisions do not apply to CHA. We find no merit in this argument. As stated above, the appellant, as a declarant, could be an importer, a clearing and forwarding agent, etc., who undertakes the delivery of the consignment for the purpose of transporting such consignment of goods to its destination outside West Bengal. Once such a declaration is made by the appellant, he is a transporter, even assuming that the said provisions, namely, sections 68, 71B and Explanation (a) to section 72, are applicable only to a transporter. The matter can be looked at from another angle. Section 68 imposes a restriction when it says that no person shall transport any consignment of goods from any railway station, airport, port, etc., except in accordance with such conditions and restrictions, as may be prescribed. In other words, the restriction on movement of goods under sub-section (1) of section 68 of the Act can only be lifted in a situation falling under sub-sections (3) and (4) of section 68 of the Act. Under sub-section (3), any person, who seeks delivery of the consignment, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture. Further, the transporter is required to carry such a declaration and other documents and produce them before the prescribed authority of the last check-post for his verification. In our view, section 72 of the Act read with rule 223(1) of the Rules has no application to the facts of the present case. Section 72, no doubt, deals with goods being transported through the State of West Bengal; however, the said section specifically refers to entry of a "goods vehicle" into West Bengal and such vehicle transporting the goods is bound for a place outside West Bengal. In the present case, we are concerned with goods coming from Hamburg in Germany into the port in West Bengal, hence, section 72 of the Act has no application. Moreover, the word "transporter" has been defined specifically for the purpose of only sections 72 and 73 of the Act and has not been defined for the entire Act. In the circumstances, it is not open to the appellant to say that there is a clear dichotomy between a transporter and a CHA/clearing and forwarding agent. In the present case, we are concerned with the contravention of the provisions of section 68 of the Act by a person who makes a declaration in the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h declaration, retain one copy of such endorsed declaration with it and return the other copy to the person transporting such goods for onward movement to the place of destination outside West Bengal after recording in his register the particulars given in the declaration. As stated above, it is the case of the appellant that sub-rule (6) of rule 211A applies to a transporter and not to a CHA. We find no merit in this submission. If one reads sub-rule (6), it becomes clear that the said sub-rule refers to copies of the declaration duly countersigned under sub-rule (4) to be produced before the prescribed authority at the exit check-post. Sub-rule (4), in turn, refers to a declaration being made under sub-rule (2) which, in turn, refers to the declaration made under sub-rule (1) of rule 211A of the Rules. Therefore, under sub-rule (4), such a declaration is required to be countersigned by the prescribed authority and two copies thereof are returned to the declarant under sub-rule (1). In other words, sub-rule (6) applies to a declarant who could be a transporter, CHA, clearing and forwarding agent or any person taking delivery of the consignment of goods from the port for despatch o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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