9911796707
TMI Blog2000 (5) TMI 1048X X X X Extracts X X X X X X X X Extracts X X X X ..... by the respondent No. 1 held a search at the shops of the applicant-firm and also shop Nos. A-18 and A-19 belonging to another business concern named M/s. M.R. Dairy Products Pvt. Ltd. The firm alleges that inspite of production of relevant documents and registers, the respondent No. 1 seized the goods found at its (firm's) shops as well as the goods found in shop Nos. A-18 and A-19 belonging to M/s. M.R. Dairy Products by single seizure receipt drawn in the name of the firm alone. Seizure was made by the respondent No. 1 on the allegation that there was a contravention of the provisions of section 68 of the 1994 Act. The firm alleges that it has been served with a notice in form 44 initiating a penalty proceeding. Its further case is that though its Accountant Shri Subrata Mondal, who is also the Accountant for M/s. M.R. Dairy Products Ltd., produced relevant documents to establish that the stocks of SMP in question were purchased locally within West Bengal, the respondent No. 1 imposed a penalty of Rs. 16,08,450 after determining the value of the goods to be Rs. 64,33,800. A demand notice in form 45 was served. The firm challenges the validity of the seizure and the order impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts in support of local purchase of goods in question. The applicant challenges the validity of such search and seizure and also of the service of the show cause notice in form 44 on the grounds identical to those set up by the applicants of the abovementioned two cases. 4.. The case made out by the respondents in their affidavits-inopposition in the three cases is that the searches in the four shop rooms were made strictly in accordance with the legal provisions after recording the reasons for such searches and ultimate seizures. In disputing the applicants claim that they are not liable to be assessed to tax, the respondents contend that every dealer is liable to pay tax on his turnover of sales under section 10(1) of the 1994 Act unless he can prove to the satisfaction of the competent authority that the goods sold were purchased in West Bengal. The respondents also assert that the provisions of section 69(b) of the 1994 Act are not ultra vires the Constitution nor does it vest unguided and arbitrary power on the competent authority to effect search or seizure in violation of the constitutional safeguard enshrined in articles 14 and 19(1)(g) of the Constitution. The claim of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erifying whether any consignment of goods are being or have been transported in contravention of the provisions of section 68 or section 73, the Commissioner, an Additional Commissioner, or any person appointed under sub-section (1) of section 3 to assist the Commissioner, may, subject to such restrictions as may be prescribed,- (a) .................................... (b) search at any warehouse or at any other place in which, according to his information, such goods so transported in contravention of the provisions of section 68 have been stored, or (c) ...................................." 6.. It has been contended by the applicants that the power conferred under the above section on the authorities, enumerated in the section itself, is uncontrolled, uncanalised and arbitrary and that the section does not provide any safeguard to check the power from being exercised arbitrarily. Mrs. Chandrima Bhattacharya, learned senior counsel for the applicants argues that the section does not require that before the search of the warehouse the searching officer shall have to form an opinion as to the importation of the goods into West Bengal in contravention of the provision of sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would become redundant because in such event he can straightway resort to the provisions of section 70 which lays down the procedure for seizure. Therefore, search on the basis of information coupled with the opportunity to the dealer to explain the stock cannot be said to be arbitrary. 7.. Again, search itself does not amount to deprivation of the dealers' right to own and possess goods which he deals in, and cannot be said to be infringing the right protected by article 19(1)(g) of the Constitution of India. Interference with a dealer's right to own/ possess the goods, however, occurs when the seizure is effected under section 70 after forming opinion about the contravention of law. Though the provisions of section 70, dealing with the provisions for seizure, is not in controversy before us, it is worth-mentioning that the section provides adequate safeguard to prevent the power to seize from being arbitrary or unguided. The section provides that before the seizure is effected the officer concerned must have "reason to believe" that the goods or any part of it found at the warehouse has been imported into West Bengal in contravention of section 68. It is now a settled posi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officer conducting the search. At this stage we are not going to enter into such factual aspect. The respondents have produced the two recorded reasons for the two seizures in question. Objection as to adequacy or correctness of the reasons may be agitated, before the authorities below in the context of the given circumstances. 9.. In the above circumstances, we find no ground to hold that section 69(b) of the 1994 Act is ultra vires the Constitution. The other factual issues as referred to above or as may be agitated by the applicants shall be decided by the seizing officer if the hearing in the penalty proceeding has not yet been concluded or by the appropriate fact-finding authorities above the seizing officer where the penalty order has been passed, as the case may be. For the purpose of calculating the period of limitation to move the appropriate forum against the seizure or against the order in the penalty proceeding the period during which the applicants have pursued the application on the issue relating to the constitutional vires of section 69(b) shall not be taken into account. 10.. The applications are, therefore, dismissed. However, the applicants, if so advised, m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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