9911796707
TMI Blog2011 (8) TMI 1013X X X X Extracts X X X X X X X X Extracts X X X X ..... t ORDER The petitioner, a proprietary concern, is a registered dealer under the Andhra Pradesh Value Added Tax Act, 2005 ( the VAT Act ) on the rolls of the Commercial Tax Officer (CTO), Bapatla. It is in the business of manufacturing and marketing veterinary medicines. Having purchased 20 barrels of Pongamia oil from M/s. Makam Industries, Gowribidanur, Kamataka, for their business, the petitioner was transporting the same on May 9, 2011. The vehicle carrying the goods was checked by the respondent, who detained both the vehicle and the goods on the ground that they were not accompanied by advance way-bill in form X or form 600, and that the driver of the vehicle had failed to produce the record of the goods vehicle, the trip sheet arid/or log book as prescribed under section 48(b) of the VAT Act. Oil extracted from the seed of pingamia pinnata (in vernacular, kanuga). The petitioner's authorized representative (AR) appeared before the respondent on May 10, 2011. As there was urgency to meet the requirement of supply of veterinary medicines to the Animal Husbandry Department, the AR got the vehicle and the goods released by paying ₹ 22,056 towards tax and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nor produced, the way-bill, but filed a letter admitting guilt. Therefore, the order was passed levying tax. As the irregularities committed were admitted, another notice was issued for levying penalty calling upon the petitioner to file objections within seven days. The petitioner filed a letter accepting liability, and expressed their willingness to pay the tax and penalty. Therefore, another order was passed levying penalty. The counsel for the petitioner submits that there was no voluntary payment of tax and penalty by the petitioner as the goods were detained along with the vehicle and, as there was urgency, the petitioner paid the tax and penalty. Therefore, the petitioner cannot be said to have accepted the contravention or irregularity. The collection of tax and penalty, by the respondent, is highly arbitrary as deprecated by the judgment of a Full Bench of this court in Ambica Lamp House v. Commercial Tax Officer (Int)-I [2005] 142 STC 551 (AP); [2005] (2) ALD 704; [2005] 3 ALT 190. Per contra, the Special Counsel for Commercial Taxes submits that the levy of the tax and penalty was preceded by the notices as contemplated under section 45(7) of the VAT Act; the AR rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 46 of the VAT Act empowers any officer, not below the rank of Deputy Commercial Tax Officer, to enter into and search the office, carrier, or bailee or the person-in-charge of the goods and the records to whom the goods were delivered for transmission if such carrier or bailee keeps the goods in any office, shop, godown or any other place. In such an event, the carrier or bailee or person in-charge of the goods shall provide all facilities to the searching official for examination and inspection, and produce the bill of sale or delivery note and other documents. Section 45 of the VAT Act has nine sub-sections. This section, in a somewhat comprehensive manner, deals with establishment of check-posts, obligation of a driver or any other person in-charge of the goods vehicle to stop the vehicle at the check-post for the purpose of preventing evasion of tax, the consequences that would follow for non-production of documents in proof of payment of tax and other matters. An analysis of section 45 of the VAT Act would reveal the following. The Government or the Commissioner, with a view to prevent or check evasion of tax in the State, may, by notification, direct the setting up of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the purchase of the goods for the purpose of payment of tax is properly accounted for in the documents referred to in section 45(2)(b) of the VAT Act. Under section 45(3)(b) of the VAT Act, if the tax payable has not been paid or the sale or purchase of the goods for the purpose of payment of tax has not been properly accounted for, the officer, after making such enquiry, shall detain the goods and direct the driver or any other person in-charge to pay such tax or to furnish security for an amount equal to two times the amount of tax payable to the prescribed authority, on behalf of the person liable to pay the tax. If tax is paid and security is furnished, the goods shall be released forthwith (section 45(4) of the VAT Act). If tax is not paid or security is not furnished, as per section 45(6) of the VAT Act, the officer-in-charge of the check-post shall detain only so much of the goods as are approximately equal in value to the amount of the tax directed to be paid or security directed to be furnished, as long as may reasonably be necessary. In. case the goods are to be detained for more than three days, the check-post officer shall have to obtain permission from the next hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hims and fancies. At the stage of detaining the vehicle, at the stage of demanding tax or security as a condition precedent for release of the goods' and vehicle, and at the stage of levying penalty, the officer is required to act reasonably and put the person, likely to be affected, on notice. The empowering provision does not enable the officer-in-charge of the check-post to detain every vehicle to levy tax on all the goods and levy penalty in every situation. The question of detaining the vehicle, the goods, levying tax and penalty would arise only when the goods are carried without payment of the tax and/or without proper documentation of the sale or purchase of the goods carried. Even in such a situation, if the driver or person in-charge of the goods is willing to pay such tax (which means, provisionally assessed tax) or to furnish security, the goods cannot be detained. They shall be released and the procedure as contemplated in rule 56 of the VAT Rules shall be followed. Even when there is a necessity to levy penalty, the officer shall afford reasonable opportunity to the person likely to be affected . If the tax is paid for the purpose of release of the goods, or se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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