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TMI Blog1990 (11) TMI 399X X X X Extracts X X X X X X X X Extracts X X X X ..... intercepted and under compulsion the petitioners paid a sum of Rs. 16,908 towards Orissa sales tax and Rs. 784 towards turnover tax for one truck and a sum of Rs. 3,840 towards sales tax and Rs. 179 towards turnover tax for the other truck, as demanded by the officer-in-charge of the check-post. The legality of the same has been assailed in this petition. 3.. Section 16-A of the Act read with rule 94 of the Orissa Sales Tax Rules, 1947 (in short, "the Rules"), deal with the power of the officer-in-charge of a check-post in a case of the present nature. The validity of these provisions have not been assailed before us; nonetheless, our attention has been invited to Kamal Kumar Goyal v. State of Orissa [1975] 35 STC 343 (Orissa), wherein validity of the power of confiscation, as conferred by section 16-A(3) had been questioned on the strength of Check Post Officer v. K.P. Abdulla and Bros. [1971] 27 STC 1. In that decision, the apex Court had declared the power of confiscation as ultra vires as the power by the concerned Act had been conferred irrespective of the fact whether the goods in question were meant for sale or not. The third proviso to section 16-A(3) of the Act, however ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of tax cannot lead to an inference of tax evasion when the concerned person disputes its liability before the authorities. It may be stated here that before the final decision was rendered in this case, the persons concerned had approached the statutory authority under the Act and had disputed their liability to pay tax under the Act. 6.. This is all we have to say by way of referring to precedents of this Court as well as of other courts which have dealt with the question of interception of the goods at the check-posts including validity of some of the provisions relating to detention and confiscation of the goods. In so far as the case at hand is concerned, we find that pursuant to the requirement of rule 94(4)(a) of the Rules, a notice in form VI-B was served on the driver of the truck in question wherein it was stated that the goods were meant for works contract. Because of this, Central sales tax and Orissa sales tax registration numbers were demanded. Another defect pointed out in the way-bill was that the same had not been signed either by the consignor or the consignee. As to this, it is stated by Shri Mahanti that the same was non-existent inasmuch as the consignor had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of evasion of any tax on sale. This apart, in the present case, petitioner No. 1 being a registered dealer, there was hardly any occasion for the officer-in-charge of the check-post to think of evasion of tax even if the goods were being brought in connection with works contract. If it would have been found subsequently that the goods had been involved in the execution of a works contract and if this transaction would have been exigible to sales tax under the provisions of the Act, the arms of law were long enough to reach the petitioners in view of the fact that petitioner No. 1 is a registered dealer. The realisation of the amount in question from the petitioners has, therefore, no authority of law. So we would order for refund of the same. 9.. In the result, the petition is allowed by ordering refund of the two amounts paid by the petitioners at the check-post. 10.. Before parting, we propose to deal with the submission of Shri Mahanti that there is harassment of persons at the check-posts and we should intervene to see that honest tax-payers are spared the highhandedness of the persons manning the check-posts. Learned Standing Counsel, on the other hand, contends that ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evasion arises once the transaction has become taxable which would be when there has been either a sale or a purchase. As to the goods which are brought from outside the State, it is apparent that the same being in the course of interState trade or commerce, the liability to tax depends upon the situs of the sale. As in most of these cases the movement of the goods would be pursuant to the contract of sale or purchase, the situs would be outside the State because of which the goods would suffer Central sales tax or the State sales tax in the exporting State. So far as this State is concerned, the question of payment of sales tax would arise if after the goods have been brought into the territory, there is a further sale. The occasion for the same would be after the goods have entered the territory and not at the point of entry. So, there would be hardly any occasion to detain such goods at the check-posts. This apart, when in the way-bill the registration number of the buyer of the goods is reflected, there would be no justification for the check-post officers to entertain a belief that the payment of tax would get evaded by such a person on his selling the goods subsequently. So, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x has become payable, which would be so if the taxable event has already taken place and not where this event has to take place in future. 13.. As to why the State Government while framing the rules did not authorise the officer-in-charge of the check-post to detain goods on its satisfaction that the owner of the goods would avoid payment of tax after selling the goods following entry of the same in the territory of the State is a matter relatable to the wisdom of the State Government. It may be that it was felt that conferment of such a power would clothe the officer-in-charge with such drastic power which it would be difficult to control. Needless to say that such a power would have indeed conferred almost unbridled power because it would have been easy in very many cases to say that the goods would be sold within the territory of this State and the seller would not pay the required tax. In case of unregistered dealer, such an allegation can be made almost in every case; even registered dealers would not be able to escape easily the grip of the Officer-in-charge. We need to say nothing further in this regard in this case except to reiterate that the power of the kind asked for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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