Punjab-Haryana High Court
M/S Vimal Alloys Pvt. Limited vs The State Of Punjab And Others on 13 February, 2014
Author: Ajay Kumar Mittal
Bench: Ajay Kumar Mittal, Anita Chaudhry
CWP No.1028 of 2014 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
CWP No.1028 of 2014
Date of decision: February 13, 2014
M/s Vimal Alloys Pvt. Limited
......Petitioner
Vs.
The State of Punjab and others
.....Respondents
CORAM: HON'BLE MR. JUSTICE AJAY KUMAR MITTAL
HON'BLE MS. JUSTICE ANITA CHAUDHRY
Present: Mr. Sandeep Goyal, Advocate for the petitioner.
Mr. Jagmohan Bansal, Additional A.G.Punjab.
Ajay Kumar Mittal,J.
1. Through the present petition filed under Articles 226/227 of the Constitution of India, the petitioner prays for issuance of a writ in the nature of mandamus directing the respondents to release its goods and vehicle on furnishing of Surety bond dated 8.1.2014, Annexure P.4.
2. A few facts relevant for the decision of the controversy involved, as narrated, in the petition may be noticed. The petitioner is a dealer duly registered under the provisions of the Punjab Value Added Tax Act, 2005 (in short, "the Act") and is engaged in the business of trading of iron and steel goods. In the normal course of its business, the petitioner sold three consignments of goods i.e. metal rolls vide bills No.567, 568 and 569 dated 2.1.2014 for ` 4,22,442/-, ` 2,41,414/- and ` 3,22,333/- respectively. The petitioner booked the said consignments with M/s Orissa Punjab Transport Company. The goods were loaded in the vehicle Singh Gurbax 2014.02.13 14:26 I attest to the accuracy and integrity of this document High Court Chandigarh CWP No.1028 of 2014 2 on 2.1.2014 by the said company. The said transporter had to pick up another consignment of goods i.e. cycle parts from Ludhiana to which the petitioner had no connection. The cycle parts which were to be picked from Ludhiana were to be loaded on the top of the metal rolls sold by the petitioner. Therefore the driver of the vehicle decided to load the consignment of the petitioner first and thereafter started journey towards Ludhiana for loading the consignment of cycle parts. After loading the cycle parts from Ludhiana, when the driver was yet to leave the city of Ludhiana, he was intercepted by the Excise and Taxation Officer (ETO) at Ludhiana. On enquiry by the officer, the driver of the vehicle produced various documents pertaining to the items loaded in the vehicle. The ETO detained the vehicle on certain grounds like verification of documents and goods excess than the covering documents. According to the petitioner, at the time of issuing the notice, the detaining officer did not mention the specific section or clause under which the vehicle had been detained as subject of the notice was for the "Detention of goods under section 51(6) (a) (b) read with explanation under section 51(7) (d) of the Act." The petitioner appeared before the concerned ETO alongwith its books of account and other documents. According to the petitioner, the ETO questioned that it should have carried e-ICC forms as per Rule 64B of the Punjab VAT Rules, 2005 (in short, "the Rules") and because of its failure to do so, the goods were liable to the detained under section 51(6) (b) of the Act. The petitioner pointed out that the e-ICC forms could not be got issued as the transporter had to load more goods from Ludhiana and he had assured that the same would be got issued before the exit of such goods from the State Singh Gurbax 2014.02.13 14:26 I attest to the accuracy and integrity of this document High Court Chandigarh CWP No.1028 of 2014 3 of Punjab. It was also pointed out that in case the e-ICC forms would have been issued for the consignment of the petitioner, then the transporter at Ludhiana would not have been in a position to get e-ICC forms generated for the subsequent consignment of cycle parts in the same vehicle which was yet to be loaded from Ludhiana. The ETO however insisted that he would release the goods only on payment of 50% penalty or on furnishing of bank guarantee to the tune of 50% of the value of the goods. Thereafter, the petitioner took legal advice from his lawyer that as per amended Section 51(6) (b) of the Act, offence under Rule 64 B is made out only after the vehicle makes an exit from the State of Punjab and in case the necessary information is given at the Virtual Information Centre before the exit of goods from the State of Punjab, then no offence under section 51 of the Act is made out. The petitioner prepared surety bond on 8.1.2014 and got the same attested by the ETO Mandi Gobindgarh which was furnished to the ETO Ludhiana on 15.1.2014 alongwith the detailed reply. The ETO however, refused to acknowledge the receipt of the surety bond and stated that he would neither accept nor reject the said bond in writing. Hence the present petition for release of the vehicle and the goods of the petitioner being illegally detained by the respondent authority.
3. Upon notice, written statement has been filed on behalf of respondents No.1 and 2 by Shri Manmohan Singh, ETO-cum-Detaining Officer wherein it has been inter-alia stated that the goods of the petitioner are one of the five specified goods and therefore, uploading of information through virtual e-ICC is compulsory before putting the same into transit for export out of the State. This information is required to be submitted in Singh Gurbax 2014.02.13 14:26 I attest to the accuracy and integrity of this document High Court Chandigarh CWP No.1028 of 2014 4 Form VAT 12 electronically for which the petitioner had due ID and password issued by the department. The transporter at Ludhiana had uploaded the information through e-ICC of all the goods booked by him except the goods of the petitioner. On these premises, prayer for dismissal of the petition has been made.
4. We have heard learned counsel for the parties and perused the record.
5. The point for consideration in the present case is whether the petitioner is entitled to release of goods by furnishing surety bond under Section 51(6) (a) of the Act or the respondent can legitimately require the petitioner to furnish bank guarantee under Section 51(6) (b) of the Act.
6. It would be expedient to refer to relevant portions of sub sections (1) to (4), (6) and (7) of Section 51 of the Act which are material for the purposes of adjudicating the controversy involved herein.
7. According to sub section (1) of Section 51, in order to prevent or check avoidance or evasion of tax, the State Government is entitled to establish check post or information collection centre or both at such place or places as may be specified in the notification. Sub section (2) prescribes that owner or person incharge of the goods vehicle shall carry with him goods vehicle record, goods receipt, trip sheet or logbook, as the case may be and sale invoice or bill or cash memo or delivery challan containing prescribed particulars in respect of such goods meant for the purpose of business. The said person is required to produce the aforesaid documents on demand by an officer Incharge of a check post or Information Collection Centre or any other person not below the rank of Excise and Taxation Singh Gurbax 2014.02.13 14:26 I attest to the accuracy and integrity of this document High Court Chandigarh CWP No.1028 of 2014 5 Officer checking the vehicle at any place. However, under the proviso, the persons selling goods from within or outside the State in the course of inter State trade or commerce shall also furnish or cause to be furnished a declaration with such particulars as may be prescribed. It has further been provided that a taxable person selling or dispatching any goods from within the State to a place outside the State or imports or brings any goods or receives from outside the State is also required to furnish particulars of the goods in a specified form which can be procured from the designated officer duly filled in and signed. Sub section (3) lays down that at every check post or information collection centre or at any other place when so required by an officer, the driver or any other person incharge of the goods and goods vehicle shall stop the vehicle and keep it stationary as long as may reasonably be necessary and allow the officer incharge to check the contents in the vehicle by breaking open the package or packages, if necessary and inspect all records relating to the goods carried which are in possession of the driver or any other person. Sub section (4) relates to the stopping of vehicle at the nearest check post or information collection centre wherein the owner or person incharge of the goods and goods vehicle enters the limits or leaves the limits of the State. He is also required to furnish a declaration in triplicate as mentioned in sub section (2) alongwith the documents. Sub section (6) (a) provides that if the officer incharge of the check post or information collection centre or any other officer as mentioned in sub section (2) has reasons to suspect that the goods under transport are meant for trade and are not covered by proper and genuine documents or that the person transporting the goods is attempting to evade Singh Gurbax 2014.02.13 14:26 I attest to the accuracy and integrity of this document High Court Chandigarh CWP No.1028 of 2014 6 payment of tax, he may for reasons to be recorded in writing and after hearing the person concerned, order detention of the goods alongwith the vehicle for a period not exceeding seventy two hours. Such goods shall be released on furnishing of security or executing a bond with sureties in the prescribed form and manner by the consignor or the consignee if registered under the Act to the satisfaction of the officer on duty and if the consignor or the consignee is not registered under the Act, then on furnishing of a security in the form of cash or bank guarantee or crossed bank draft which shall be equal to the amount of penalty leviable rounded upto the nearest hundred. Clause (b) of sub section (6) deals with where the owner or the person incharge of the goods has not submitted the documents or has not submitted the information as specified in the rules at the nearest check post or information collection centre in the State, then such goods shall be detained alongwith the vehicle for a period not exceeding seventy two hours. Sub section (7) provides for penalty to be levied and for release of goods and vehicle in case of any violation of the provisions of Section 51 of the Act.
8. Rule 64-B of the Rules, which is also relevant reads as under:-
"Rule 64-B - Procedure for furnishing information in respect of inter-state trade or commerce of goods through Virtual Information Collection Centre.
(1)Nothwithstanding anything contained in rule 64, the owner or person in charge of the specified goods, before putting the same into transit for export out of the State, for trade or commerce by any mode of transition, shall submit information in Form VAT-12, through Virtual Information Collection centre on the official website of the department i.e. www.pextax.com;Singh Gurbax
or any other website as may be specified by the Commissioner. 2014.02.13 14:26 I attest to the accuracy and integrity of this document High Court Chandigarh CWP No.1028 of 2014 7 (2) Such owner or person in charge, after tendering of the aforesaid information through electronic mode, shall generate electronic receipt bearing unique number allotted to him as a proof for submission of the said information. The aforesaid receipt shall be a necessary document alongwith the goods receipt, trip sheet or log book, bill or cash memo, sale invoice, vehicle's record, in which such goods are being transported of delivery challan etc. as the case may be, as a proof for such transaction.
(3) The maximum transition time for delivery of goods from the place of departure of such goods to the nearest information collection centre, falling enroute towards destination while exiting the State, shall be such, as may be specified by the Commissioner from time to time.
(4) The owner or person incharge, submitting information through electronic mode, shall keep his password secret and shall change the same periodically, preferably after every two months; and any information submitted by him through the said mode form his i.d., shall be treated an information submitted by him."
9. Procedure for furnishing information in respect of inter state trade or commerce of goods through Virtual Information Collector centre has been incorporated in the above mentioned rule. According to sub rule (2), such owner or person in charge after tendering of the aforesaid information is required to furnish electronic receipt bearing unique number allotted to him as a proof for submission of the said information. The aforesaid receipt shall be a necessary document alongwith the goods receipt, trip sheet or log book bill or cash memo, sale invoice, vehicle's record in which such goods are being transported.
10. Examining the factual matrix in the present case, it was not Singh Gurbax 2014.02.13 14:26 I attest to the accuracy and integrity of this document High Court Chandigarh CWP No.1028 of 2014 8 disputed that there was no check post or Information Collection Centre which had been crossed by the transporter while going from Mandi Gobindgarh to Cheema Chowk, Ludhiana where the documents were checked. The vehicle had been sent to Ludhiana to get cycle parts loaded which were to be loaded on the metal rolls sold by the petitioner. It was thereafter that e-ICC form was to be generated. As urged by learned counsel for the petitioner, in case the e-ICC form had been generated by the transporter earlier, the goods which were to be fetched from Ludhiana could not have been legally taken by the transporter. Thus, the case of the petitioner is covered under Section 51(6) (a) and not under Section 51(6) (b) of the Act. Further, the petitioner is a registered dealer under the Act and in such a situation, furnishing of surety bond would be legally permissible and the demand of bank guarantee by the respondents was unjustified.
11. In view of the above, while allowing the writ petition, we direct the respondents to release the goods and vehicle of the petitioner on furnishing of surety bond forthwith. Needless to say that any observations made herein above shall not be taken to be expression of opinion on the merits of the case.
The original record be returned to the learned State Counsel under proper receipt.
(Ajay Kumar Mittal)
Judge
February 13, 2014 (Anita Chaudhry)
'gs' Judge
Singh Gurbax
2014.02.13 14:26
I attest to the accuracy and
integrity of this document
High Court Chandigarh