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TMI Blog2022 (5) TMI 559X X X X Extracts X X X X X X X X Extracts X X X X ..... ters seized - In order to recover the outstanding taxes and penalty due from the petitioner, recovery proceeding had been initiated which, however, was stayed by orders of this court passed in the present proceedings. Under section 44 it is clearly provided that any authority appointed under sub-section (1) of section 3, besides requiring any dealer to produce books of accounts, registers or documents or information relating to any transaction, is authorized, for reasons to be recorded in writing, to seize such books of accounts, registers or documents of any dealer including persons transporting goods or any owner of warehouse/godown. Therefore, it is clear that under the provisions of the Act, an authority prescribed under section 3(1) will be an authority who is empowered to proceed for search and seizure of any records, registers, books of accounts relating to any transaction - In the present case, respondent no. 5 is a Superintendent of Taxes and is one of the officers of the State who is vested with the powers for search and seizure under section 44, by virtue of the powers vested on him under section 3 of the Act. It is not the case of the petitioners that it is only an o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 is a competent officer as prescribed under section 3 of the Act and no challenge to the authority or power of the officers empowered under section 3 of the Act have been made by the petitioner. The only ground of the challenge is that the respondent no. 5 was not a member of the vigilance group or wing on the date when the search and seizure was made - the materials recovered during a search, which may not have been conducted as per the provisions of law, are also admissible in evidence and it is permissible to take consequential actions under the provisions of law, as have been done in the present case. There are no merit in the present writ petition and the same is, therefore, dismissed. - WP(C) 3383/2005 - - - Dated:- 6-5-2022 - HON BLE THE CHIEF JUSTICE HON BLE MR. JUSTICE SOUMITRA SAIKIA Advocate for the petitioners : Mr. S. K. Muktar, Advocate. Advocate for the respondents : Mr. B. Choudhury, Advocate. JUDGMENT AND ORDER (CAV) (S. Saikia, J) Heard Mr. S. K. Muktar, learned counsel for the petitioners. Also heard Mr. B. Choudhury, learned counsel appearing for the respondents. 2. The petitioner No. 1 is a partnership firm carrying on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o produce documentary evidence. On 02.03.2004 the petitioner company submitted its reply to the said notice requesting the respondent authority not to realize tax and/or to impose penalty. The respondent no. 5 thereafter worked out an amount of Rs. 2,75,000/- as tax payable by the petitioner and verbally directed the petitioner to deposit the same, which the petitioner deposited vide Treasury Challan dated 30.03.2004. 5. About four months thereafter the petitioner No. 1 was served with an Assessment order-cum-Notice of Demand dated 05.08.2004, issued by the respondent no. 5 under section 46A(4), whereby tax was assessed at Rs. 5,68,942/- (Rupees five lakh sixty-eight thousand nine hundred and forty-two) and also penalty was imposed to the tune of Rs. 17,06,826/- (Rupees seventeen lakh six thousand eight hundred and twenty-six). Since the aforesaid amount could not be paid by the petitioner No. 1 immediately, another notice dated 21.09.2004 was issued by the respondent no. 4 directing the petitioner company to deposit the amount within a period of seven days from the date of receipt of the notice. It was also mentioned in the said notice that failing to deposit the amount within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the assessment proceedings as well as the recovery of taxes and imposition of penalty. Referring to section 45 of the Act of 1993, the petitioners have also questioned the jurisdiction of the respondent no. 5 to function as a Vigilance Officer inasmuch as such Vigilance Committee/Vigilance Group has to be constituted by the government by issuing appropriate notification. According to the petitioners, the respondent no. 5 cannot be identified as a taxing authority under Rule 7 of the Rules of 1993 framed under section 3(1) of the Act of 1993. Therefore, he has no locus to act as a taxing authority under the Act and the Rules of 1993. Consequently, the notices issued, the proceeding initiated and the assessment orders passed as well as the subsequent demand notices issued for recovery of taxes and imposition of penalty are but without jurisdiction and, therefore, the same are not in compliance of the provisions of the Act of 1993 read with the Rules of 1993. The petitioners therefore pray for setting aside and quashing of the notice dated 28.01.2004 (Annexure-B), Seizure List dated 28.01.2004 (Annexure-C), Notice dated 29.01.2004 (Annexure-D), Show Cause notice dated 17.02.2004 (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te provisions for appeals to the appellate authority as well as the tribunal in terms of section 33 and 34 respectively of the Act of 1993. Under section 35 of the said Act, it is only a revision which can be preferred before the High Court against any order passed under section 34(3) by the Tribunal/the Assam Board of Revenue. However, the issues raised by the writ petitioners in the present proceeding relate to jurisdiction of the respondent officers of the department, more particularly, respondent no. 5 to function as an officer of the Vigilance Group and to conduct search and seizure as also the power of assessment and consequential orders for demand and recovery of tax and penalty. 11. The petitioners have also questioned the search and seizure made by the respondent no. 6 in the place of its business. According to the petitioners, the search was conducted by an officer of the department, namely, respondent no. 5, projecting himself to be a member of the vigilance wing . According to petitioner such projection is a misrepresentation by the respondent no. 5 inasmuch as the said vigilance wing was not constituted on the date when the search and seizure was made. The petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alled. Section 2(33) defines sale to define any transfer of property in goods by any person for cash or for deferred payment or other valuable considerations including, inter alia, delivery of goods on higher purchase or any system of payment or installment or under a financial lease. It is provided that such delivery or transfer or supply of goods shall be deemed to be sale of goods by the person making the delivery, transfer or supply. Section 44 prescribes the procedure for production, inspection, seizure of accounts, documents as well as search for premises. Under sub-section (3) of section 44 it is provided that any authority appointed under sub-section (1) of section 3 having reasons to suspect evasion of payment of tax by a dealer including a person transporting the goods or any owner of warehouse or godown and is keeping or has kept the books of accounts in such a manner as is likely to cause evasion of tax payable under this Act, such authority may, for reasons to be recorded in writing, seize such books of accounts, registers or documents of the dealers including the persons transporting the goods and/or the owner of warehouse/godown. Such books of accounts, docum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iii) Any delivery of goods on hire purchase or any system of payment by installments or under a financial lease; (iv) Any transfer of the use of any goods under an operating lease; (v) Any supply of goods by an unincorporated association or a body of persons to a member thereof for cash, deferred payment or other valuable consideration; (vi) Any supply, by way of or as part of any service or in any other manner whatsoever of goods, being food or any other article for human consumption or any drink (whether or not intoxicating), where such supply or service is for cash, deferred payment or other valuable consideration; 3. Tax Authority. - (1) For carrying out the purposes of this Act, the State Government may by notification appoint a person to be the Commissioner of Taxes, together with such other persons to assist him as it thinks fit and may specify the areas or areas over which they shall exercise jurisdiction. 44.(3) If any authority appointed under sub-section (1) of section 3 has reason to suspect that any dealer is to evade the payment of any tax or any clearing or forwarding agent or a person transporting goods or any owner of a warehouse or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat when penalty is imposed under this sub-section no prosecution for the same offence shall be initiated. (4) When the transporter, carrier or transporting agent does anything directly or indirectly which results in evasion of tax or would have resulted in evasion of tax if such evasion was not detected and prevented in time, the Commissioner may after giving him a reasonable opportunity of being heard, direct him to pay by way of penalty an amount equal to three times the amount of tax evaded or sought to be evaded. In such case, the transporter, carrier or transporting agent shall be deemed to be a dealer and he shall also be liable to pay the tax evaded or sought to be evaded: Provided that when penalty is imposed under this sub-section no prosecution for the same offence shall be initiated. 14. A perusal of the sections of the Act of 1993 reveals that ordinarily transporters are not required to pay sales tax as they are not treated to be dealers per se. However, in order to prevent evasion of tax, the State Government has introduced the provision subsequently for registration of transporters, including transporters who transport taxable goods in the State of Assam. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority prescribed under section 3(1) will be an authority who is empowered to proceed for search and seizure of any records, registers, books of accounts relating to any transaction. In the present case, respondent no. 5 is a Superintendent of Taxes and is one of the officers of the State who is vested with the powers for search and seizure under section 44, by virtue of the powers vested on him under section 3 of the Act. It is not the case of the petitioners that it is only an officer under the enforcement group/wing who is competent to conduct search. Rather, it is petitioners case that the respondent no. 5 misrepresented himself to be a member of the vigilance group or wing and conducted search on the date on which the respondent no. 5 had not been made a member of such group or wing. There is no averment that notwithstanding the respondent no. 5 not being a member of the vigilance group or wing, he is otherwise not vested with the powers under the Act to conduct search and seizure as has been done in the present case and, therefore, such search and seizure is illegal and unauthorized. The respondent department in its affidavit has contested the case and has disputed the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned is otherwise empowered to conduct such search or seizure as provided for under the Act. The notices issued by the respondent no. 5 for production of records and documents, the inspection conducted at the business premises of the petitioner No. 1 as well as the seizure of records and documents, as mentioned in the search report dated 21.08.2004, reflect reasons for conducting the search and seizure of books of accounts, records, documents etc. of the petitioner. The reasons reflected in the Search and Seizure Memo. are extracted below: The transporter booked, made movement and allowed delivery of various consignments of taxable goods in fictitious names and addresses. The movement of such consignments of taxable goods are not supported by delivery notes in form-24. The transporter allowed delivery of consignments of taxable goods without obtaining countersigned copies of the consignment notes. The entire episode is considered to have been formatted and conceived in wooing and inducing other traders to evade payment of due taxes and also to derive wrongful gain and to cause wrongful loss to the state exchequer. 19. Even if it is to be accepted that a search conducte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held to be unconstitutional as it takes away the powers of the High Court as conferred under Articles 226 and 227 of the Constitution of India. It was submitted at the Bar that matter is presently pending disposal before the Apex Court. 23. Section 4, as it stood prior to the interference by this court, provides that jurisdiction of the tax authority was not to be called into question . Under the provision of section 4, as it then stood, no person was entitled to call into question the jurisdiction of any authority under section 3 after expiry of 90 days from the date of receipt by him any notice under this Act from such authority. There is no bar for this court to deal with this matter as the vires of section 4 or any question relating to vires of section 4 is not an issue in the present proceeding, section 4 of the Act of 1993 having been set aside by a Co-ordinate Bench of this Court. 24. As discussed above, respondent no. 5 is a competent officer as prescribed under section 3 of the Act and no challenge to the authority or power of the officers empowered under section 3 of the Act have been made by the petitioner. The only ground of the challenge is that the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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