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TMI Blog1997 (9) TMI 562X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods between the bilty and the consignment note, the respondent-firm failed to produce the declaration form ST-18A as required by section 22A(3) of the Rajasthan Sales Tax Act, 1954 (in short, the Act ) and rule 62A(3) of the Rajasthan Sales Tax Rules of 1955 (for short, the Rules ). Consequently the ACTO issued a notice to the respondentfirm on February 18, 1992 calling upon the latter to show cause as to why a penalty should not be imposed upon it under section 22A(7) of the Act. The reason given was that it had imported goods without proper documents. This notice was replied to on March 4, 1992 on behalf of the respondent-firm which took up the position that since it had recently started its business and since it could not apply for and obtain the declaration form S.T.-18A in time it could not be sent to the consignor with the result that it could not be produced in time. The respondent-firm applied for the declaration form to the assessing authority on February 7, 1992 and it was issued on February 18, 1992. The explanation offered by the respondent-firm was found unsatisfactory with the result that the ACTO on March 5, 1992 slapped upon the respondent-firm a penalty of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n was dated January 28, 1992. A show cause notice was issued by the ACTO to the respondent-firm on February 18, 1992. It was on February 7, 1992 that is, two days after the date of inspection that the respondent-firm applied for the declaration form to the assessing authority. It obtained the declaration form on February 18, 1992. Thus it is conclusively proved on facts, which are not in dispute, that when the goods were imported into the State from outside the goods were not accompanied by the declaration form as required under section 22A(3) of the Act and rule 62A(3) of the Rules. In these circumstances, Shri Lodha contends that the liability for penalty was incurred by the respondent-firm. Ignorance of law is no excuse. The ground that the respondent-firm started its business recently is also without any substance. As against this, the learned counsel for the respondent-firm Shri Dinesh Mehta contends before us that the declaration form which was required to accompany the goods was produced later before the ACTO. Such a production did take place before ACTO imposed the penalty on March 5, 1992. Such a document could be produced at a subsequent stage. Law did not require that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or animal carrying any goods enters or leaves the State limits, the declaration referred to in sub-section (3) also. (6) The officer in-charge of the check-post or barrier or any other officer empowered in that behalf may seize or pass order to retain under sub-section (9) any goods (other than exempted goods) which are under transport by a vehicle, boat or animal in respect of which the declaration is false or which are not covered by the documents prescribed under sub-section (3): Provided that before seizing any goods, the officer-in-charge of the checkpost or barrier or any other officer empowered in that behalf shall record his reasons for doing so and shall give a receipt for the goods to the person from whose possession or control they are seized. ....................... (7)(a) The officer-in-charge of the check-post or barrier or any other officer not below the rank of an Assistant Commercial Taxes Officer, empowered in this behalf may, after giving the owner or person-in-charge of the goods a reasonable opportunity of being heard and after holding such further enquiry as he may deem fit, impose on him for possession of goods not covered by goods vehicle record, an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistration under the CST Act, 1956 of the registered dealer purchasing the goods as being intended for use by him in the manufacture or processing of goods for sale or in mining or in the generation or distribution of electricity or any other form of power. Provided further that form ST-18A need not be furnished if the goods consigned to the State of Rajasthan are high and light speed diesel oil, petrol and aviation spirit. 7.. Sub-section (3) as quoted above speaks of the owner or the person incharge of a vehicle, boat or animal who shall carry with him. (i) A goods vehicle record, a trip sheet or a log book, as the case may be, and, (ii) Such other document as may be prescribed in respect of the goods concerned. It also makes it obligatory on the part of the owner of the goods or person in-charge of the vehicle, etc., to produce the foregoing documents before an officer in-charge of the check-post or barrier or any other officer as may be empowered in this behalf by the State Government. Thus the duty cast upon the owner of the goods or the person in-charge of the vehicle is not only to carry with him certain documents specified above but also to produce them on demand be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. The liability for penalty was complete the moment the requisite documents including declaration form did not accompany the goods. A subsequent reproduction of the declaration form was not a proper compliance with the requirement of law. If we take a view other than the one we have taken it would nullify the very purport and intendment of the provisions of law. It will also facilitate the avoidance and evasion of payment of tax. 9.. The learned counsel for the respondent-firm, Shri Dinesh Mehta, has placed his reliance on the decision in State of Andhra Pradesh v. Hyderabad Asbestos Cement Production Limited [1994] 94 STC 410 (SC); (1994) 3 JT 456 which dealt with certain cases arising from the Tamil Nadu General Sales Tax Act, 1959 and Andhra Pradesh General Sales Tax Act, 1957. The question related to the liability arising from the non-production of form C as required under rule 12(7) of the Central Sales Tax (Registration and Turnover) Rules, 1957. This sub-rule (7) together with the proviso appended thereto is as hereunder: (7) The declaration in form C or form F or the certificate in form E-I or form E-II shall be furnished to the prescribed authority up to the time of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority affirmed. It was held in paragraph 8 of the report (pages 68-69 of STC; page 110 of RTJ) that if the goods are carried unaccompanied by the requisite documents a breach of the condition for carrying goods is complete. With regard to the imposition of penalty, it was held that it could not be imposed until an enquiry was held after giving a reasonable opportunity of being heard to the person proceeded against. The answer to the question as to whether a particular person is or is not the owner of the goods depends in each particular case upon its peculiar facts. No hard and fast rule can be laid down in this regard. Thus the imposition of penalty is not Here italicised. automatic but is subject to the holding of the enquiry after giving a reasonable opportunity to the person proceeded against. The question of mala fide intention or mens rea is important only with regard to the determination of the question concerning the imposition of the penalty. There may be technical breach of provisions of law. In another case there may be a flagrant breach of the provisions of law. Both these cases must differ from each other so also the amount of penalty. It was further held in parag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... similar document and a written declaration in duplicate duly signed by the consignor or his authorised agent in the form mentioned in the Schedule appended to this subrule in respect of such consignment, and shall, on demand by the officer referred to in the proviso to sub-rule (1) of rule 70A, produce the said documents and declaration, and the said officer, on being satisfied about the correctness of the documents and the declaration, shall only allow the movement of such quantity of notified goods mentioned in that declaration and conforming to the description given therein and to other documents produced. He shall retain one copy of the declaration and return the second copy on which he shall endorse the date on which the consignment is transported and shall sign, seal and date such endorsement; (b) If the declaration referred to in clause (a) in respect of any consignment has already been submitted to an officer referred to in the proviso to sub-rule (1) of rule 70A, any person transporting such consignment shall, on demand by such officer at any subsequent place, produce the countersigned and sealed copy of the aforesaid declaration. 12.2. The contention of the petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requisite documents and also the declaration will entail the consequences with regard to the imposition of penalty. 13.. The decision in State of U.P. v. Haji Ismail Noor Mohammad Co. [1988] 70 STC 101 (SC); (1988) 25 STL 200 (SC), Shri Dinesh Mehta has placed his reliance upon is of no help to the respondent-firm. Under section 3-D of the U.P. Sales Tax Act, 1948, a dealer was liable to purchase tax on oil-seeds at 3 per cent ad valorem on the turnover of the purchases made by him from the cultivators or other unregistered dealers. Section 4-B of the Act, however, provided for the grant of relief in the form of concessional rate of tax with regard to such purchases of notified goods provided a manufacturer held a recognition certificate issued under sub-section (2) in respect thereof. On February 10, 1969 such a relief was announced. On March 21, 1969 the respondent under section 4-B(2) applied to the prescribed authority for the grant of recognition certificate which was finally granted on December 5, 1969. The question was whether on the basis of this recognition certificate dated December 5, 1969, the respondent could claim the relief in the form of concessional rate of ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y imposed under section 22A(7)(a) has been paid or a security as may be demanded in lieu of such amount of penalty has been furnished under section 22A(7)(b), he shall release the goods and deliver the same to the owner or in-charge of the goods or vehicle as the case may be, after obtaining acknowledgement to that effect. (Emphasis* added) This rule 63(3) underwent an amendment with effect from March 4, 1992. The amended sub-rule (3) is as hereunder: (3) When such goods are seized, the said officer in-charge or such other officer referred to in sub-rule (2) shall serve a notice on the owner or person in-charge of the goods or the vehicle, as the case may be, requiring him to show cause within 15 days from the date of service of notice as to why the documents mentioned in rule 62A(1) were not produced or the correct particulars in the declarations mentioned in rule 62A(2) were not furnished at the time of checking. If the said officer-in-charge or such officer is satisfied with the reply or the penalty imposed under section 22A(7)(a) has been paid or a security as may be demanded in lieu of such amount of penalty has been furnished under section 22A(7)(b), he shall release th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rule 62A(2) of the Rules within 15 days from the date of the service of the notice or where the security is furnished or the amount of penalty imposed under section 22A(7)(a) has been paid the goods, shall be released and delivered to the owner or person-in-charge of the vehicle. Apart from this rule 63(3) does not come in the way of the imposition of penalty by the assessing authority under section 22A(7) of the Act. Amendment made in sub-rule (3) does not bring about any material change in the situation. The old sub-rule (3) required the owner or person-in-charge of the goods or the vehicle, as the case may be, to furnish the documents whereas the amended sub-rule (3) requires the officer-in-charge concerned to serve on the person-in-charge of the goods or the vehicle, as the case may be, a notice calling upon the latter to show cause within fifteen days from the date of service of the notice as to why the requisite documents were not furnished at the time of checking. This is a distinction without difference. A very important proposition which runs like a distinctive thread through the provisions of sub-rule (3), both old and new, is that it comes into operation after the sei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the vehicle, etc., fails to produce the requisite documents. Subsequent production of the documents does not have the effect of absolving the owner or person-in-charge of the goods or vehicle from the liability for penalty. The question of mala fide intention or mens rea does not arise at the time of the commission of the offence. It is, however, important at the time of the imposition of penalty. The quantum of penalty may differ according to whether there is a technical or a substantial breach of the provisions of section 22A(3) of the Act. 18.. A careful examination of the relevant provisions gives rise to the following legal position: (i) That an owner or a person in-charge of the goods is obliged to possess (carry) and produce on demand the documents as specified in section 22A(3) of the Act and rule 62A of the Rules. (ii) That the failure to possess and produce the documents mentioned hereinabove will entail the consequences with regard to the imposition of penalty under section 22A(7) of the Act. (iii) That the offence under section 22A(7) of the Act is complete on failure to produce the requisite documents. The question of mens rea is immaterial here. (iv) Tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1992. The sub-rule (3) of rule 63 was amended by S.O. No. 311 dated March 4, 1992. Till March 4, 1992, the rule was as under: (3) When such goods are seized, the said officer in-charge or such other officer referred to in sub-rule (2) shall serve a notice on the owner or person in-charge of the goods or the vehicle, as the case may be, requiring him to furnish the documents mentioned in rule 62A(1) or the correct particulars in the declaration mentioned in rule 62A(2) within 15 days from the date of service of the notice. If the said officer in-charge or such other officer receives the documents of the correct particulars in declaration in respect of the goods so seized within the aforesaid period, or the penalty imposed under section 22A(7)(a) has been paid or a security as may be demanded in lieu of such amount of penalty has been furnished under section 22A(7)(b), he shall release the goods and deliver the same to the owner or in-charge of the goods or vehicle as the case may be, after, obtaining acknowledgement to that effect. (emphasis* added) The notice was received by the dealer on February 20, 1992 and the declaration form was produced on March 4, 1992 along with the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nical Member).-This application for revision has been filed under section 86 of the Rajasthan Sales Tax Act, 1994 read with section 7 of the Rajasthan Taxation Tribunal Act, 1995 ( RTT Act for short) and is directed against an order dated March 2, 1995 in Appeal No. 223/92/ST/Jodhpur of the Rajasthan Sales Tax Tribunal (as the Rajasthan Tax Board, hereinafter referred to as the Board , was then known) rejecting the appeal of the present petitioner (ACTO) and upholding the order dated July 15, 1992 of the Deputy Commissioner (Appeals), Jodhpur in Appeal No. 6/RST/Jodh-C/92-93 accepting the appeal of the present respondent-dealer against the order dated March 5, 1992 of the ACTO imposing a penalty of Rs. 59,483 under section 22A(7) of the Rajasthan Sales Tax Act, 1954 (the old Act) for non-furnishing of declaration in form ST 18A and for certain discrepancies in the value of goods as shown in the goods receipt (GR) bilty and consignment note. 2.. This case came to be heard by a Division Bench of this Tribunal comprising the honourable Chairman and the honourable Judicial Member. There was a difference of opinion between the two. The honourable Chairman was inclined to dismiss the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rge of a vehicle, boat or animal shall carry with him a goods vehicle record, a trip sheet or a log book, as the case may be, and such other documents, as may be prescribed in respect of the goods carried in or on the vehicle, boat or animal, as the case may be, and produce the same before any officer in-charge of check-post or barrier or any other officer as may be empowered by the Government in that behalf. The owner or person in-charge of a vehicle, boat or animal entering the State limits or leaving the State limits shall also give a declaration containing such particulars as may be prescribed of the goods carried in or on the vehicle, boat or animal, as the case may be, before the officer in-charge of the check-post or barrier or the officer empowered as aforesaid and give one copy of the declaration to such officer, and keep one copy with him. .......................... (7)(a) The officer in-charge of the check-post or barrier or any other officer not below the rank of an Assistant Commercial Taxes Officer, empowered in this behalf may, after giving the owner or person in-charge of the goods a reasonable opportunity of being heard and after holding such further enquiry as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1997]. (b) Such officer may release any of the goods seized under sub-section (5) or sub-section (6) on payment of the penalty under clause (a) or on furnishing such security in such form as may be prescribed for the payment thereof, as he may consider necessary. (c) Such officer may, for sufficient reasons release any of the goods seized as aforesaid even before proceeding under clause (a) or during the course of proceedings under that clause, on furnishing of security of an amount equal to the estimated value of the goods to be released if he considers it necessary so to release the goods. Rule 62A: Documents prescribed under section 22A(3).-(1)-.......... ............................ (3) A registered dealer- (a) who imports any goods, as notified by the State Government, for sale, use in the manufacture or processing of goods for sale or in mining or generation or distribution of electricity of any other form of power or packing of goods for sale, or (b) who receives any goods consigned to him from outside the State for sale, shall make and furnish or cause to be furnished declaration in form ST 18A. The counterfoil of the declaration shall be retained by suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty imposed under section 22A(7)(a) has been paid or a security as may be demanded in lieu of such amount of penalty has been furnished under section 22A(7)(b), he shall release the goods and deliver the same to the owner or in-charge of the goods or vehicle as the case may be, after obtaining acknowledgement to that effect. (Emphasis* added). Here italicised. (3A) An officer issuing directions under sub-section (9) of section 22-A shall complete the verification or enquiry within 7 days of the issue of directions. This period may, however, be extended for a further period not exceeding 7 days after obtaining the written permission from Deputy Commissioner (Adm.)/AntiEvasion having jurisdiction. (4) The security for the purpose of section 22A(7)(b) may be furnished by executing a security bond in form ST-18B with two sureties acceptable to the said officer-in-charge or such other officer, as the case may be, or in any of the forms specified in rule 67AA as may be considered convenient by the owner or in-charge of the goods or vehicle. (5) In case the goods so seized are subject to speedy and natural decay, and in the case of the other goods, where no compliance of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to be, inter alia, given to the owner of the goods to show cause against imposition of penalty. 7.. It is in the light of this view of the provisions of the law that the facts of the instant case need to be seen. 8.. The facts of the case are that on inspection on February 5, 1992 of the books of a transporter goods covered by GR. No. 126300 dated January 28, 1992 of which the dealer was the consignee were detained by the ACTO on suspicion of evasion of tax. The consignor was M/s. Dhariwal Tobacco Product Pvt. Ltd., Pune. The goods in question were 51 cases of pan masala. On February 18, 1992 the dealer produced the GR and the consignment note for verification and in a written application seeking release of the goods mentioned that if required the dealer was prepared to submit a copy of form ST 18A. Admittedly, therefore a declaration in form ST 18A did not accompany the goods. By a notice to the dealer of the same date, i.e., February 18, 1992 the ACTO required the dealer to show cause as to why a penalty under section 22A(7) ought not to be imposed for the violation of the provisions of section 22A(3) and rule 62A(3) inasmuch as the consignment note mentioned the value o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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