Andhra HC (Pre-Telangana)
Santhosh Wines vs Assistant Commercial Tax Officer, ... on 31 October, 1994
Equivalent citations: [1995]99STC160(AP)
Author: Syed Shah Mohammed Quadri
Bench: S.S. Mohammed Quadri
JUDGMENT Syed Shah Mohammed Quadri, J.
1. Challenging the validity of the order of seizure of the stocks of the petitioner on October 19, 1994 passed by the 1st respondent, this writ petition is filed seeking a writ of mandamus directing the 1st respondent to release the seized stocks under the impugned order and for a further direction to issue certificate of registration under section 12 of the A.P. General Sales Tax Act, 1957, for short "the Act".
2. The petitioner commenced business in liquor/goods specified in the Sixth Schedule to the Act. He filed an application for registration under section 12 of the Act on October 11, 1994 and commenced business thereafter. When the 1st respondent inspected the premises of the petitioner, he noticed that the petitioner was carrying on business without possessing certificate of registration under the Act. On that ground the 1st respondent seized the stocks of the petitioner on October 19, 1994. The order of seizure, as stated above, is assailed in the writ petition. The learned Government Pleader took notice before admission and filed counter-affidavit.
3. Sri S. Krishna Murthy, the learned counsel for the petitioner, contends that the petitioner has already filed an application for grant of certificate of registration. So in view of the provisions of sub-rule (10)(c) and sub-rule (11) of rule 28 of the A.P. General Sales Tax Rules, 1957, he shall be deemed to be a registered trader. As such the stocks are not liable to be seized. He further contends that even if the petitioner is an unregistered dealer, still that is not a ground under the Act, for seizure of the stocks. Therefore the impugned order of seizure is wholly without jurisdiction.
4. The learned Government Pleader, Commercial Taxes, invited our attention to the provisions of sub-section (6) of section 28 of the Act in support of his contention that the seizure is not without jurisdiction and that the seizure is well within the power of the 1st respondent and if the petitioner is aggrieved by the impugned order, submits the learned Government Pleader, the petitioner has an effective alternative remedy of appeal, to question the seizure. He further submits that the statutory period of 30 days has not elapsed from the date of filing the application for registration, as such the petitioner is not entitled to the benefit of the provision conferring deemed registration and that the petitioner is an unregistered dealer. He also contended that the petitioner being an unregistered dealer is under no obligation to maintain the accounts and therefore it must be deemed that the petitioner has not accounted for the seized stocks which he was possessing, as such the case falls under section 28(6) of the Act.
5. The questions that arise for consideration are :
1. Whether, the petitioner can be considered to possess deemed registration under the provisions of the Act or the Rules made thereunder ?
2. Whether the impugned order of seizure of stocks of the petitioner is without jurisdiction ? and
3. Whether the writ petition is liable to be dismissed on the ground that the petitioner is having alternative remedy of appeal under the Act ?
6. We shall take up the first point. Section 12 of the Act deals with registration of dealers. Sub-section (2) of section 12 which is relevant for our purpose enjoins that every dealer carrying on business in all or any of the goods mentioned in the First, Second, Third, Fifth and Sixth Schedules shall get himself registered under the Act, irrespective of the quantum of turnover. The proviso to sub-section (2) empowers the State Government to exempt any dealer or class of dealers from registration under section 12. It is nobody's case that such an exemption was granted to the petitioner. As mentioned above, the goods in which the petitioner is dealing are those mentioned in the Sixth Schedule and irrespective of the quantum of turnover, the petitioner is bound to get himself registered under section 12. It would be relevant to notice the provisions of sub-section (5) of section 12, which mandate that every dealer who is liable to get himself registered under sub-section (1) or sub-section (2) or sub-section (4) shall not carry on business as a dealer unless he has been registered and is in possession of a certificate of registration. A combined reading of sub-section (2) and sub-section (5) of section 12 makes it clear that the petitioner cannot carry on business in the goods mentioned in the Sixth Schedule, without getting himself registered under the Act.
7. The procedure for registration is mentioned in sub-section (6) of section 12, which says that -
"An application for registration shall be made to the prescribed authority, in such manner and within such time as may be prescribed and shall be accompanied by a fee of one hundred rupees."
8. If the authority is satisfied that the application made by the petitioner is bona fide and is in order and in conformity with the provisions of the Act and the Rules made thereunder and the condition, if any, imposed under sub-section (7) has been complied with, he shall register the application and grant a certificate of registration in the prescribed form.
9. Rule 28 of the A.P. General Sales Tax Rules deals with the question of registration of the dealer. Sub-rule (2) of rule 28 provides that every dealer liable to get himself registered under sub-section (2) of section 12 of the Act, shall submit an application for registration to the registering authority before the commencement of his business. Clause (a) of sub-rule (10) of rule 28 directs that if the registering authority receiving the application for registration is satisfied, after making necessary enquiries that all the requirements are complied with, he shall register and issue the certificate within 30 days from the date of receipt of application. Clause (b) of sub-rule (10) requires that the registering authority shall give the applicant a notice of further enquiry or a notice to show cause against rejection of the application within a period of thirty days from the date of receipt of application, if for any reason the certificate of registration could not be issued within the period of 30 days. Clause (c) of sub-rule (10) provides that for the consequence of not taking any of the above two courses mentioned under sub-rules (10)(a) and (10)(b) of rule 28; if the certificate of registration is not received by the applicant within 30 days from the date of submission of his application or if no notice is received by him within the said period of 30 days from the date of submission of the application, the application shall be deemed to have been duly registered. It may also be relevant to note that the certificate of registration issued or deemed to have been issued under sub-rule (10) shall take effect from the date of receipt of application for registration in the case of any person (other than a person succeeding to the business or part thereof). On a harmonious construction of the provisions and the rules referred to, the position that emerges is that a person carrying on business in goods mentioned in the Sixth Schedule has to compulsorily get himself registered under sub-section (2) of section 12 of the Act. He should not commence business before obtaining the certificate of registration. The registering authority is bound to dispose of the application within the 30 days from the date of submission of the application or issue a notice to show cause as to why the application should not be rejected. If the authority fails to comply with any of the above two conditions, the application for registration will be deemed to have been registered on the expiry of the 30 days and in case of any person other than the person succeeding to the business. The certificate of registration or deemed registration will take effect from the date of receipt of the application for registration.
10. In the instant case, the petitioner made an application on October 11, 1994. The shop was inspected on October 19, 1994. On or before October 19, 1994, no certificate of registration was issued to the petitioner. The statutory period of 30 days not having expired, the petitioner cannot claim to have deemed registration certificate; as such, as on October 19, 1994 the petitioner could not carry on business without registration. Therefore, the first contention of the learned counsel for the petitioner that as on October 19, 1994 the petitioner should be deemed to be in possession of the deemed registration, is without any merit and is therefore rejected. The first point is accordingly answered.
11. Coming to the second point, the learned Government Pleader relied on sub-section (6) of section 28 in support of the seizure of the stocks of the petitioner by the 1st respondent. It will be useful to read the said provision.
"28(6). Any such officer shall have power to seize and confiscate any goods which are found in any office, shop, godown, vehicle, vessel or any other place of business or any building or place of the dealer, but not accounted for by the dealer in his accounts, registers and other documents maintained in the course of his business;"
12. A plain reading of section 28(6) makes it evident that any officer not below the rank of Assistant Commercial Tax Officer if authorised by the State Government so to do, may seize and confiscate any goods which are found in any office, shop, godown, vehicle, vessel or any other place of business or any building or place of the dealer. But before such seizure could be effected, the officer has to satisfy that the goods found in any of the places mentioned above are not accounted for by the dealer in his accounts, registers and other documents maintained in the course of his business. In the instant case, the impugned order reads as follows :
"M/s. Santhosh Wines is doing business in retail liquor at Lakdikapool, Hyderabad, without possession of registration certificate under section 12 of the APGST Act, 1957. Therefore, I herewith seize the goods as per list enclosed."
Sd/-
19-10-1994 Assistant Commercial Tax Officer, Khairatabad.
13. The ground for seizure is given as non-registration of the dealer under section 12 of the Act. Sub-section (6) of section 28, referred to above, does not empower seizure of stocks on the ground of non-registration of the dealer.
14. We are unable to accept the contention of the learned Government Pleader that as the petitioner is not a registered dealer, even though the seized stocks are accounted for, it will not amount to accounting the same within the meaning of the said sub-section. The registration or non-registration of dealer for seizure is wholly irrelevant. Therefore, it follows that the action of seizure of the goods by the 1st respondent is without jurisdiction and is not authorised by law.
15. The last question for consideration is whether the ground that it is having an alternative remedy of appeal under section 19 of the Act, would disentitle the petitioner to the relief in this writ petition. It is now well-settled that exhaustion of alternative remedy is a factor which is to be taken into consideration having regard to the facts and circumstances of the case, in exercise of jurisdiction under article 226 of the Constitution of India. Normally, in exercise of jurisdiction under article 226 of the Constitution, the High Court will not entertain a writ petition, if an effective statutory remedy of appeal is available. But when the authority passing the impugned order has violated the principles of natural justice and where the order is patently lacking in jurisdiction, the availability of alternative remedy is not treated as a bar, for exercise of jurisdiction under article 226.
16. From the above discussion it follows that the impugned order is without jurisdiction and is therefore liable to be quashed. We accordingly quash the impugned order and allow the writ petition with costs. The seized goods shall be returned to the petitioner forthwith. We however, make it clear that this order does not preclude the authorities from taking such action against the petitioner as is available to them in law, for carrying on the business without obtaining the registration certificate as per sub-section (2) of section 12 of the Act.
17. Writ petition allowed.