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TMI Blog2011 (9) TMI 916X X X X Extracts X X X X X X X X Extracts X X X X ..... eized as the goods shall be deemed to be that of the railways. According to the petitioners' counsel, the goods of City Booking Agencies have been seized by the Trade Tax Department of the State without taking note of the terms and conditions of the agreement entered with the railways. The "City Booking Agency" is a part and parcel of the railways, hence the Trade Tax Department lacks jurisdiction to seize the goods or impose penalty. In some of the cases, penalty has been imposed, being not satisfied with the reply submitted by the petitioners and in some of the cases notices have been issued and penalty has been imposed under section 15A(1)(k) of the Trade Tax Act and in some of the cases, the assessing officer has passed the order imposing trade tax on the petitioners. By an interim order passed by this court, the goods were released. While assailing the action of the respondents with regard to all these four categories of cases, Sri S.M.K. Choudhary, learned senior counsel, submits that law has been settled by the Division Bench of this court that City Booking Agencies are part and parcel of railways, hence they are not liable to pay the trade tax. He has invit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re claim to that effect is not conclusive. In fact, the grievance of the sales tax authorities is that a large scale evasion is going on under the cover of transporting the goods from the railway station to the city booking agencies. Their case is that goods are being transported to the premises of dealers under the guise of and with the connivance of the said agencies and that this fraud is resulting in loss of crores of revenue to the State. We shall therefore, first examine whether the High Court was justified in interfering with the finding of fact recorded by the Deputy Commissioner in this case: Now, the power of the sales tax authorities to stop and check the goods being transported to satisfy themselves that they are being validly transported is undoubted. If they are satisfied that the goods being transported were imported into the State of Uttar Pradesh but that they are not accompanied by the documents/forms required by the Act and the Rules, they are entitled to seize the goods and levy the tax and penalty as is provided by law. The said power necessarily includes the power to decide the question whether the goods in fact were being transported to city booking agency or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ering into the findings of fact, recorded by the Deputy Commissioner and hold that the petitioners may challenge such finding of the Deputy Commissioner which is a finding of fact in appeal, if not already challenged. The Supreme Court yet observed towards the end of para 5 at page 608 in 96 STC; page 278 in UPTC as under: 'This finding of ours should have concluded the civil appeal but we were requested by both the parties to determine the larger question, viz., whether the railway booking agencies do or do not form part of the "railway"? While we agree that the said question should be decided, we find that the relevant material is not placed before us for determining the said question and for that reason, the matter requires to be remitted to the High Court.' The Supreme Court remitted the question: whether the city booking agencies established at Kanpur--or for that matter anywhere else in the State of Uttar Pradesh fall within the expression 'railway' as defined in section 3(4) of the Railways Act, 1890 or section 3(31) of the Railways Act, 1989?" In pursuance to the observations made by the honourable Supreme Court, the Division Bench further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the agreement deed entered into between M/s Kamal Prakash Ashok Kumar-contractor of the City Booking Agency, Bhoosa Toli, Kanpur, annexure 1 to the supplementary affidavit (no agreement of any other contractor is filed by the railway). The said agreement deed does not contain any condition contrary to the instructions, as contained in the manual. From the above reproduced instructions and the agreement deed, it is amply clear that the city booking agency is the extended hand of the railways. The goods are booked at the city booking office in the same fashion as they are booked at the serving station. The city booking agency is set up only to facilitate the booking of traffic. If one does not find it convenient to go to the railway station, he can get his goods booked or ticket reserved at the city booking office. City booking office is nothing but an extended hand or a sub-office of the railway station. The city booking agency is fully controlled by the railway administration. For booking and transporting the goods, the contractor of the city booking agency receives remuneration for the services rendered as per the contract and the contractor is fully responsible for the safety o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich works/functions in accordance with the agreement, then such goods neither can be seized nor penalty can be imposed or may take into custody for the assessment under the Trade Tax Act (now VAT Act). The observations made by the Division Bench of this court (Union of India v. Sales Tax Officer [1998] 109 STC 1 (All)) dealing with this aspect of the matter is reproduced as under (pages 13 and 14 in 109 STC): "Before parting with the case, we would like to observe for the advantage of the departmental authorities that before seizing the goods being allegedly transported to the city booking agency from the railway station, they should ordinarily verify the version of the contractor of the city booking agency from the record of the railway administration. It may not be possible for the contractor of the city booking agency to produce the entire material before the departmental authority right at the spot where the goods are intercepted, but the material to the satisfaction of the departmental authorities might be available with the railway administration, where requisite forms/ registers/documents are maintained in connection with the booking and receipt of the parcels. Simply ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ispose of these writ petitions with the following directions: (a) in those cases where assessing authority has already passed assessment order and against which statutory appeal lies, it shall be open to the petitioners to prefer an appeal within a period of one month. In case such appeal is filed, then the competent appellate authority shall entertain the same on merit and decide it in accordance with law by passing a reasoned and speaking order, expeditiously and preferably, say, within a period of two months from the date of filing of the appeal; (b) in those cases where notices were issued by the assessing authority or the officer of the Trade Tax Department under sections 13 and 13A of the Trade Tax Act, the petitioners may submit a reply within a period of one month and after receipt of reply from the petitioner, the competent authority shall decide the same in accordance with law keeping in view the judgment of this court in Union of India v. Sales Tax Officer [1998] 109 STC 1 (All) by passing a speaking and reasoned order expeditiously and preferably within a period of two months; (c) in those cases where goods were already delivered by the city booking agency transporte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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