Patna High Court - Orders
Suraj Transport Roadways Pvt. Ltd. & Ors vs The State Of Bihar & Ors on 15 July, 2014
Author: R.M. Doshit
Bench: Chief Justice, Ashwani Kumar Singh
IN THE HIGH COURT OF JUDICATURE AT PATNA
Civil Writ Jurisdiction Case No.958 of 2013
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Supreme Road Transport Private Limited at AG-77, Supreme House,
Sanjay Gandhi Transport Nagar, New Delhi-42, through its Director Arun
Singhal S/O Sri K.B. Singhal, Resident of House No. 61, Pushpanjali,
Vikash Marg Extension, Delhi-92
.... .... Petitioner
Versus
1. The State of Bihar through The Principal Secretary Department of
Commercial Taxes-Cum-Commissioner, Commercial Taxes, Vikash
Bhawan, Secretariat, Government of Bihar, Patna
2. Deputy Commissioner of Commission of Commercial Taxes, Dobhi
Check Post, Dobhi, Police Station Barachati, District- Gaya
3. Commercial Taxes Officer, Dobhi Check Post, Dobhi Police Station
Barachati, District- Gaya
.... .... Respondents
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with
Civil Writ Jurisdiction Case No.1630 of 2013
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1. Suraj Transport Roadways Pvt. Ltd., a Private Limited Company
incorporated under the Companies Act, having its Registerd Office and
Head Office at 'Suraj House' 316, Daya Basti, Old Rohtak Road, P.O-
Indralok, P.S- Sarai Rohita, Delhi- 110035, Through its Regional Manager,
Patna, Madan Choudhary S/O Late Baidya Nath Choudhary, Resident of
Kasera Compound, Agamkuan, Near Gandhi Setu Link Road, P.O & P.S-
Agamkuan, District- Patna.
2. Bal Govind Yadav S/O Late Nanku Yadav, Resident of Village
Bhurkunda, P.O- Nainsagar, P.S- Varachatti, Distt- Gaya.
.... .... Petitioners
Versus
1. The State of Bihar through The Chief Secretary, Government of Bihar,
Old Secretariat, Patna.
2. The Commissioner- Cum- Principal Secretary, Commercial Taxes
Department, New Secretariat, Patna.
3. The Deputy Commissioner of Commercial Taxes, Integrated Check Post,
Karmanasha, Kaimur (Bihar)
4. The Assistant Commissioner of Commercial Taxes, Integrated Check
Post, Karmanasha, Kaimur (Bihar)
5. The Commercial Taxes Officer, Integrated Check Post, Karmnasha
(Bihar)
.... .... Respondents
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Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014
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with
Civil Writ Jurisdiction Case No.1804 of 2013
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1. Suraj Transport Roadways Pvt. Ltd., a Private Limited Company
incorporated under The Companies Act, having its Registered Office and
Head Office at „Suraj House‟ ; 316, Daya Basti, Old Rohtak Road, P.O.
Indralok , P.S. Sarai Rohita, Delhi - 110035, Through its Regional Manager,
Patna, Madan Choudhary, Son of Late Baidya Nath Choudhary, Resident of
Kasera Compound, Agamkuan, Near Gandhi Setu-Link Road, P.O. & P.S.
Agamkuan, District - Patna
2. Aashkar Hussain, Son of Eliyas Hussain, Resident of Village Dingarpur,
P.O. Dingarpur, P.S. Mainather and District - Muradabad (U.P.)
3. Intekhav Hussain, Son of Zarrar Hussain, Resident of Village Lalpur -
Gangwari, P.O. Fatehpur Khas, P.S. Mainather (Bilari) And District
Muradabad (U.P.)
.... .... Petitioners
Versus
1. The State of Bihar through The Chief Secretary, Government of Bihar,
Old Secretariat, Patna
2. The Commissioner-Cum-Principal Secretary, Commercial Taxes
Department, New Secretariat, Patna
3. The Deputy Commissioner of Commercial Taxes, Integrated Check Post,
Karmanasha, Kaimur (Bihar)
4. The Assistant Commissioner of Commercial Taxes, Integrated Check
Post, Karmanasha, Kaimur (Bihar)
5. The Commercial Taxes Officer, Integrated Check Post, Karmanasha,
Kaimur (Bihar)
.... .... Respondents
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with
Civil Writ Jurisdiction Case No.1814 of 2013
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1. Suraj Transport Roadways Pvt. Ltd., a Private Limited Company
incorporated under the Companies Act, having its Registered Office and
Head Office at 'Suraj House' 316, Daya Basti, Old Rohtak Road, P.O.-
Indralok, P.S. Sarai Rohita, Delhi-110035, through its Regional Manager,
Patna, Madan Choudhary, S/O Late Baidya Nath Choudhary, R/O Kasera
Compound, Agamkuan, Near Gandhi Setu-Link Road, P.O. & P.S.-
Agamkuan, District- Patna
2. Madan Yadav, S/O Late Ramdhani Mahto R/O Village- Gatheria Bajora,
P.O. Bajora, P.S.- Dobhi and District- Gaya
3. Sarju Kumar Yadav, S/O Ramvarata Yadav R/O Village- Haridaspur,
P.O. Korshila, P.S. Magadh Vishwa Vidayalaya, Bodh Gaya and District-
Gaya
.... .... Petitioners
Versus
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014
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1. The State of Bihar through The Chief Secretary, Government of Bihar,
Old Secretariat, Patna
2. The Commissioner-Cum-Principal Secretary, Commercial Taxes
Department, New Secretariat, Patna
3. The Deputy Commissioner of Commercial Taxes, Integrated Check Post,
Karmanasha, Kaimur (Bihar)
4. The Assistant Commissioner of Commercial Taxes, Integrated Check
Post, Karmanasha, Kaimur (Bihar)
5. The Commercial Taxes Officer, Integrated Check Post, Karmanasha,
Kaimur (Bihar)
.... .... Respondents
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with
Civil Writ Jurisdiction Case No.8427 of 2013
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1. M/s Naresh Road Lines Private Limited, having its Registered Office at
68/20, Strand Bank Road, Police Station Posta Thana, District Kolkata,
West Bengal through its one of the Director, Mr Prem Prakash Jain, aged
about 54 years, Son of S.K. Jain, Resident of 2/C, Jadu Lall Mallick Road,
Police Station - Jorabagan, District Kolkata, West Bengal
2. Murat Hussain Malick, Son of Md Dajak Mallick, Resident of Village
Budh Khari, Police Station Darnal, District Rajauri, Jammu & Kashmir
.... .... Petitioners
Versus
1. The State of Bihar through Chief Secretary, Government of Bihar, Old
Secretariat, Patna
2. The Commissioner-Cum-Principal Secretary, Commercial Taxes
Department, New Secretariat, Patna
3. The Deputy Commissioner of Commercial Taxes, Integrated Check Post
Dobhi, District Gaya
4. The Monitoring Authority, Integrated Check Post, Dobhi, District Gaya
.... .... Respondents
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with
Civil Writ Jurisdiction Case No.13078 of 2013
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1. M/S Naviya Technologies 104, Bldg No. 8, Sannkruti Apartments, 90ft.
Road Thakur Complex, Kandiwali (East) Mumbai- 101 through its Partner
Umapathi K.B, aged about 42 years, S/O Sri K.M. Bheemalinga Pillai
Resident of House No. D/ 703, Dheeraj Hill View Tower, Siddharth Nagar,
Police Station- Kajupada, Borivali East, Mumbai- 400066
2. Tudor India Ltd., as Company Registered under the Indian Companies
Act, 1956 having its Registered Office at Plot No. 10-1, Village Kamalpur
N.H.8, Prantij, District- Sabarkautha, Gujarat- 383205 through one of its
Director Mr. Ashok Jani, aged about 35 years, S/O Shri Kishanchand Jani
Presently residing at Tudor India Ltd., Ist Floor, Suman Towers, Sector II,
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014
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Police Station- Gandhinagar,-382001, Gujarat.
.... .... Petitioners
Versus
1. The State of Bihar through Chief Secretary, Government of Bihar, Old
Secretariat, Patna.
2. The Commissioner- Cum- Principal Secretary, Commercial Taxes,
Department, New Secretariat, Patna.
3. The Deputy Commissioner of Commercial Taxes, Integrated Check Post
Karmnasha, District- Bhabhua.
4. The Monitoring Authority, Integrated Check Post, Karmanasha, District-
Bhabhua.
.... .... Respondents
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with
Civil Writ Jurisdiction Case No.13981 of 2013
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NTO Logistic Pvt. Ltd., a company registered under Companies Act, 1956,
having its registered office at 2-C, Tarachand Dutta Street, Kolkata-700073,
through its one of the Director Sri Niraj Bhuwania, aged about 35 years, son
of Sri Prem Kumar Bhuwania, Resident of 2C, Tarachand Dutta Street, 2nd
Floor, Police Station Bara Bazar Rom No. 11, Kolkata -700073
.... .... Petitioner
Versus
1. The State of Bihar, through the Principal Secretary, Department of
Commercial Taxes-cum-Commissioner, Commercial Taxes, Vikash
Bhawan, Secretariat, Government of Bihar, Patna
2. Deputy Commissioner of Commission of Commercial Taxes, Integrated
Check Post, Dobhi, Police Station Barachati, District Gaya
3. Monitoring Officer, Integrated Check Post, Dobhi, Police Station
Barachati, District Gaya
4. Commercial Taxes Officer, Integrated Check Post, Dobhi, Police Station
Barachati, District Gaya
.... .... Respondents
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with
Civil Writ Jurisdiction Case No.14167 of 2013
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Shiva Transport Co. through its Proprietor, Sri Rajendra Prasad, Son of
Late Damodar Prasad, situated at Kalimata Road Sakchi, Police Station
Sakchi Jamshedpur, Jharkhand
.... .... Petitioner
Versus
1. The State of Bihar, through The Principal Secretary, Department of
Commercial Taxes - Cum - Commissioner, Commercial Taxes, Vikash
Bhawan, Secretariat, Government of Bihar, Patna
2. Deputy Commissioner of Commission of Commercial Taxes, Integrated
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014
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Check Post, Dobhi, Police Station Barachati, District - Gaya
3. Monitoring Officer, Integrated Check Post, Dobhi, Police Station
Barachati, District - Gaya
4. Commercial Taxes Officer, Integrated Check Post, Dobhi, Police Station
Barachati, District Gaya
.... .... Respondents
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Appearance :
(In CWJC No.958 of 2013)
For the Petitioner/s : Mr. Purnendu Singh, Advocate
Mrs. Pronoti Singh, Advocate
Mr. Amresh, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
(In CWJC No.1630 of 2013)
For the Petitioner/s : Mr. Ramesh Kumar Agrawal, Advocate
Mr. Rabindra Prasad, Advocate
Mr. Anupanand Jha, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
(In CWJC No.1804 of 2013)
For the Petitioner/s : Mr. Ramesh Kumar Agrawal, Advocate
Mr. Rabindra Prasad, Advocate
Mr. Anupanand Jha, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
(In CWJC No.1814 of 2013)
For the Petitioner/s : Mr. Ramesh Kumar Agrawal, Advocate
Mr. Rabindra Prasad, Advocate
Mr. Anupanand Jha, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
(In CWJC No.8427 of 2013)
For the Petitioner/s : Mr. Purnendu Singh, Advocate
Mrs. Pronoti Singh, Advocate
Mr. Amresh, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
(In CWJC No.13078 of 2013)
For the Petitioner/s : Mr. Gajendra Pd. Singh, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
(In CWJC No.13981 of 2013)
For the Petitioner/s : Mr. Gajendra Pd. Singh, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
(In CWJC No.14167 of 2013)
For the Petitioner/s : Mr. Gajendra Pd. Singh, Advocate
For the Respondent/s : Mr. Lalit Kishore, Principal AAG
Mr. Vikash Kumar, AC to PAAG
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Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014
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CORAM: HONOURABLE THE CHIEF JUSTICE
And
HONOURABLE MR. JUSTICE ASHWANI KUMAR SINGH
CAV ORDER
(Per: HONOURABLE THE CHIEF JUSTICE)
12 15- 07-2014This group of writ petitions are filed by the transporters to challenge the action of the respondent-commercial taxes authorities of seizure of the goods in transit and the vehicles/carriers for alleged violation of Section 60(2) of the Bihar Value Added Tax Act, 2005 (hereinafter referred to as the „2005 Act‟) and the action of imposing penalty in exercise of powers conferred by Sections 60(4)(a) and 60(4)(b) read with Section 56(4)(b) of the 2005 Act. The petitioners have prayed for the release of the vehicle (truck) and goods and refund of the amount of penalty recovered. The petitioners have also challenged the constitutional validity of Section 60(4) of the 2005 Act and of the Notification dated 4th July 2012 issued in exercise of power conferred by Section 93(1) of the 2005 Act and of Notifications dated 12th July 2012 and 30th October 2012 issued by the Commissioner of Commercial Taxes in exercise of power conferred by Rule 40(2) of the Bihar Value Added Tax Rules, 2005 as amended by Government Notification dated 4th July 2012.
The facts common to these writ petitions are that the petitioners are the transporters and the owners of the vehicle (truck)/the goods concerned. On the fateful day, the petitioners were transporting the goods of the consigners in one State to the consignees in the other State. While carrying the goods from one State to the other, the concerned truck had to travel through the territory of the State of Bihar. While entering the State of Bihar the truck driver or the person in-charge of the goods was required Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 7/49 to furnish particulars of the consignment, the consigner/s and the consignee/s, and the places from where and to which the goods were carried. Such information is required to be filed in a statutory format. In the present time of electronic technology and digital records, the Government of Bihar has prescribed an electronically generated form called „Suvidha‟. The driver of the vehicle/carrier or the person in charge of the goods is required to file „Suvidha‟ at the point of entry in the state of Bihar. In all these cases it is not in dispute that at the relevant time the concerned driver had failed to produce the true and complete particulars as envisaged by Rule 40 of the Bihar Value Added Tax Rules, 2005 (hereinafter referred to as the „Rules‟) and the Notifications issued thereunder. For the said failure the concerned officer - the Joint / Deputy / Assistant Commissioner of Commercial Taxes or the Commercial Taxes Officer present at the check post, in exercise of powers conferred by Section 60(4) read with Section 56(4) of the 2005 Act, seized the goods and the vehicle, lodged a criminal complaint against the owner of the goods and the vehicle and the driver of the concerned truck and imposed the penalty three times the amount of Value Added Tax assessed on the goods. Therefore, these writ petitions.
In CWJC No. 958 of 2013, the petitioner, a transport company, claims to be the owner of the truck bearing registration no. UP 82J-9521. On 23rd November 2012, the petitioner was carrying the goods (plastic granules) for the consigner in Visakhapattanam (Andhra Pradesh) to the consignee in New Delhi. On the way to New Delhi, the truck was required to pass through the State of Bihar. While entering the State of Bihar at Integrated Check Post, Dobhi, Gaya the truck driver was required to submit „Suvidha‟, the computer generated declaration. The Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 8/49 „Suvidha‟ submitted by the truck driver was found to be inaccurate/incomplete inasmuch as the particulars of the consignee were not furnished. For want of the complete information, in exercise of the power conferred by Section 60(4)(a) and Section 60(4)(b) read with Section 56(4) of the 2005 Act, the petitioner has been visited with penal consequences of seizure of the goods and the truck, and imposition of penalty. Under order dated 2nd December 2012, the tax on the goods was assessed at Rs.93,553.70; and the penalty in the sum of Rs.2,80,662.00, three times the tax assessed, has been imposed upon the petitioner. Pursuant to the said order, the demand notice for recovery of the sum of Rs.2,80,662/- has been issued on 2nd December 2012 by the Commercial Taxes Officer, Dobhi Check Post, Gaya. The F.I.R. was lodged for the alleged offence punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B IPC.
In CWJC No. 1630 of 2013, the vehicle involved is the truck bearing registration no. HR 38H-9238. It is the case of the petitioner-transporter that on the fateful day the petitioner was carrying the goods of the consigner in Delhi to Chas and Jharia in the State of Jharkhand. On the way to Jharkhand, the truck had to pass through the State of Bihar. On 23rd November 2012, while entering the State of Bihar at the Integrated Check Post, Karmanasha, Bhabua, Kaimur on the border between the State of Uttar Pradesh and the State of Bihar, the truck driver was required to submit „Suvidha‟, the computer generated declaration. The particulars entered in the „Suvidha‟ produced by the driver were not true and complete. For incorrect/incomplete information provided to the authorities the truck and the goods were seized by the authority at the check post on 26th November 2012. The F.I.R.
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 9/49was lodged for the alleged offence punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B IPC. The value added tax on the goods was assessed at Rs.49,313.94 and the penalty of Rs.1,47,942/-, three times the tax assessed, has been imposed by the Commercial Taxes Officer, Karamnasha Check Post. Pursuant to the said order, the Commercial Taxes Officer, Karamnasha Check Post, has on 1st December 2012 issued the demand notice for recovery of sum of Rs.1,47,942/-.
In CWJC No. 1804 of 2013, the vehicle involved is the truck bearing registration no. UP 23D-9632. The petitioner, the owner of the truck was transporting the goods of various consigners from its godown at Chikambarpur, U.P., to Ranchi in Jharkhand. On the way to Ranchi the truck had to pass through the State of Bihar. While entering the State of Bihar at Karamnasha Check Post on 26th November 2012, the truck driver was required to submit „Suvidha‟, the computer generated declaration. The particulars entered in the „Suvidha‟ submitted by the truck driver were found to be inaccurate/incomplete. In view of the failure of the truck driver to declare true and complete particulars of the consignment, consigners and the consignees, the authority at the Karamnasha Check Post has seized the truck and has lodged the F.I.R. for the offences punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B, IPC. Under order dated 30th November 2012, the respondent authority assessed the tax on the goods at Rs. 54,517.92 and has imposed penalty in the sum of Rs.1,63,554/-, three times the amount of tax assessed. Pursuant to the said order, a demand notice in the sum of Rs.1,63,554/- has been issued by the Commercial Taxes Officer, Karamnasha Check Post, Bhabua on 1st December 2012.
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 10/49In CWJC No. 1814 of 2013, the petitioner M/s Suraj Transport Private Limited claims to be the owner of the offending vehicle, the truck bearing registration no. HR 38J- 6121. On the day in question, the said truck was carrying the goods belonging to various consigners from its godown at Chikambarpur, U.P. to the consignees in Deoghar and Giridih in Jharkhand. On the way to Jharkhand, the truck had to pass through the State of Bihar. While entering the State of Bihar at Karamanasha Check Post on the border between the State of Uttar Pradesh and the State of Bihar, the truck driver was required to produce „Suvidha‟, the computer generated declaration. The particulars entered in the „Suvidha‟ produced by the driver were not true and complete. For incorrect/incomplete information provided to the authorities, on 26th November 2012 the truck and the goods were seized by the authority at the check post. The F.I.R. was lodged for the alleged offence punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B, IPC. Under order dated 1st December 2012, the tax on the goods was assessed at Rs. 61,618.55 and the penalty of Rs. 1,84,856/-, three times the amount of tax assessed, has been imposed. Pursuant to the said order a demand notice in the sum of Rs.1,84,856/- has been issued on 1st December 2012.
In CWJC No. 8427 of 2013, the petitioner-transporter M/s Naresh Roadlines Private Limited claims to be the owner of the truck bearing registration no. HR 6QA-1938. In February 2013 the petitioner was transporting the goods of the consigner in Kolkata for delivery to the consignee in the State of Gujarat. On the way, the truck had to pass through the State of Bihar. While entering the territory of the State of Bihar at Dobhi Check Post, Gaya, the driver of the truck was required to produce „Suvidha‟, Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 11/49 the computer generated declaration. The particulars entered into the „Suvidha‟ produced by the driver were not true and complete. For incorrect/incomplete information provided to the authorities, on 20th February 2013 the truck and the goods were seized by the authority at the check post. The F.I.R. was lodged for the alleged offence punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B, IPC. Under order dated 22nd February 2013, the Commercial Taxes Officer, Integrated Check Post, Dobhi assessed the tax on the goods at Rs.1,94,602/- and imposed the penalty of Rs.5,83,808/-, three times the amount of tax assessed.
In CWJC No. 13078 of 2013, the petitioner M/s Naviya Technologies, a partnership firm had agreed to send certain goods to a consignee in the State of Bihar. The consignment of the goods was transported from the State of Gujarat to the State of Bihar by the truck bearing registration no. GJ 08Z-8076. While entering the State of Bihar at Karamnasha Check Post, Kaimur, on the border between the State of Uttar Pradesh and the State of Bihar, the driver of the truck was required to produce „Suvidha‟, the computer generated declaration. The particulars entered in the „Suvidha‟ produced by the driver were not true and complete. For incomplete information provided to the authorities, on 14th January 2013 the truck and the goods were seized by the authority at the check post. The F.I.R. was lodged for the alleged offence punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B, IPC. The Commercial Taxes Officer, Integrated Check Post, Karamnasha, Bhabua, under his order dated 18th January 2013 assessed the tax on goods at Rs.1,09,175/- and imposed penalty in sum of Rs.3,27,525/-, three times of the assessed tax. Pursuant to the said Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 12/49 order a demand notice in the sum of Rs.3,27,525/- was issued on 18th January 2013. On payment of penalty the truck and the goods were released on 2nd February 2013.
In CWJC No. 13981 of 2013, the petitioner M/s NTO Logistic Private Limited claims to be the consigner of the goods. At the relevant time, the goods were transported through the truck bearing registration no. MP 09 HG-3507 from Kolkata in West Bengal to Madhya Pradesh. On the way, the truck had to pass through the State of Bihar. On 26th November 2012, the truck reached the Integrated Check Post, Dobhi, Gaya, on the border of the State of Bihar. At the Check Post, the truck driver was required to produce „Suvidha‟, the computer generated declaration. The particulars entered in the „Suvidha‟ produced by the driver were not true and complete. For incorrect/incomplete information provided to the authorities the truck and the goods were seized by the authority at the check post. The F.I.R. was lodged for the alleged offence punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B, IPC. Under his order dated 30th November 2012, the Commercial taxes Officer imposed the penalty in the sum of Rs.91,150/-, three times the assessed tax. Pursuant to the said order, demand notice in the sum of Rs.91,150/- was issued by the Commercial Taxes Officer, Integrated Check Post, Dobhi on 30th November 2012. On payment of penalty the truck and the goods were released on 11th January 2013.
In CWJC No. 14167 of 2013, the petitioner M/s Shiva Transport Company claims to be the owner of the truck bearing registration no. PB 10 CZ-6584. In November 2012, the petitioner transported goods of a consigner in the State of West Bengal to a consignee in the State of Himachal Pradesh through Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 13/49 the offending truck. On the way, the truck had to pass through the State of Bihar. The truck reached the State of Bihar at Dobhi Check Post in Gaya on 26th November 2012. At the Check Post, the truck driver was required to produce „Suvidha‟, the computer generated declaration. The particulars entered in the „Suvidha‟ produced by the driver were not true and complete. For incorrect/incomplete information provided to the authorities the truck and the goods were seized by the authority at the check post. The F.I.R. was lodged for the alleged offence punishable under the 2005 Act and under Sections 415, 420, 406, 407, 409 and 120B, IPC. Under his order dated 1st December 2012, the Commercial Taxes Officer, Dobhi Check Post assessed the value added tax on goods at Rs.68,513/- and imposed penalty in the sum of Rs.2,05,540/-, three times the amount of tax assessed. Pursuant to the said order, a demand notice in the sum of Rs.2,05,540/- was issued by the Commercial Taxes Officer, Integrated Check Post, Dobhi, Gaya on 1st December 2012. On payment of the amount of penalty, the truck and the goods were released on 7th December 2012.
Before we record the contentions raised by the learned Advocates, we would like to examine the scope and ambit of the relevant provisions of the 2005 Act and the Rules. Chapter VIII of the 2005 Act comprising Sections 56 to 59 provides, inter alia, for "Inspection, Search and Seizure". Sub-section (1) of Section 56 of the 2005 Act empowers any authority appointed under the 2005 Act to require any dealer , inter alia, to produce accounts, registers or documents or to furnish any information relating to the details of his purchases and sales and the stock of goods produced, raised, processed, manufactured, bought, sold or delivered by such dealer. The said sub-Section also enjoins the Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 14/49 dealer to comply with such requirement. Sub-section (3) thereof empowers the prescribed authority to enter into and search the premises including the place of business of the dealer or the person and also empowers to seize the accounts, registers or documents of the dealer or the person as may be necessary. Clause (a) of the sub-Section (4) of Section 56 of the 2005 Act empowers the authority, inter alia, to seize the goods not properly accounted for. Clause (b) of sub-Section (4) thereof empowers the concerned authority to impose penalty in the following words:-
"(b) The authority referred to in clause (a) shall, in a case where the dealer or the person-in-charge of goods as mentioned in clause (a) fails to produce any evidence or fails to satisfy the said authority regarding the proper accounting of goods, impose a penalty, after allowing an opportunity of hearing in the prescribed manner to the dealer or such person, which shall be equal to three times the amount of tax calculated on the value of such goods and the goods shall be released as soon as the penalty is paid."
Sub-section (5) of Section 56 thereof empowers the concerned authority, inter alia, to break open the lock or to seal any box or receptacle, godown or building etc. Chapter IX of the 2005 Act comprising Sections 60, 61 and 62 provides for "Check-Posts and Restrictions on Movement". Sub-section (1) of Section 60 of the 2005 Act empowers the State Government to set up check-posts and barriers at any place in the State. Sub-section (2) thereof enjoins every person transporting the goods to submit a correct and Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 15/49 complete declaration in the form and manner prescribed. Sub- section (3) thereof empowers the concerned authority to intercept, detain and search any goods carrier. Clause (a) of sub-section (4) thereof empowers such authority to seize the goods and the vehicle or carrier. Clause (b) thereof empowers such authority, inter alia, to impose penalty and to confiscate the goods in the same manner as under Section 56 of the 2005 Act. The aforesaid Section 60 of the 2005 Act reads as under:-
"60. Establishment of check-posts.- (1) The State Government may, by notification, set up and erect, in such manner as may be prescribed, check-posts and barriers at any place in the State with a view to preventing evasion of tax payable under this Act.
(2) Every person transporting goods, other than those specified in Schedule I and subject to such conditions as may be prescribed shall, at any check-post or barrier, referred to in sub-section (1) and before crossing such check-post or barrier, file before such authority or officer as may be authorized by the State Government in this behalf, a correct and complete declaration in such form and manner as may be prescribed.
(3) Any authority or officer who may be authorized by the State Government in this behalf, may, for the purpose of verifying, whether any goods are being transported in contravention of the provisions of sub-section (2) and in such manner as may be prescribed, intercept, detain and search any goods carrier; and the person, transporting goods or for the time being in-charge of goods, shall Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 16/49 render all possible assistance to such authority or officer in carrying out the search.
(4) (a) The authority or any officer referred to in sub-section (3) may seize any goods along with the vehicle or carrier, which he suspects, are being transported in contravention of the provisions of sub-section (2) together with any container or material for the packing of such goods;
Provided that a list of all the goods seized under this sub-section shall be prepared by such officer and be signed by the officer, the dealer or the person in-charge of goods and not less than two witnesses and a copy of the seizure list shall be made over to the dealer or the person in charge of the goods, as the case may be.
(b) The provisions of section 56 shall, mutatis mutandis, apply in matters relating to such seizure penalty, security, release and confiscation of goods."
Section 61 of the 2005 Act imposes restriction on movement of goods. Section 62 of the 2005 Act makes provision in respect of "Transportation of goods through State of Bihar". Sub-section (1) thereof provides for transit permission to be obtained by the driver or the person in-charge of the vehicle at the point of entry and the surrender of such transit permission at the point of exit within seventy-two hours of the entry. In case of failure to surrender the transit permission, the goods would be deemed to have been sold within the State of Bihar entailing the penalty. Section 93 of the 2005 Act empowers the State Government to make rules to carry out the purposes of the 2005 Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 17/49 Act.
In exercise of the power to make rules conferred by Section 93 of the 2005 Act, the State Government has framed the Bihar Value Added Tax Rules, 2005. Rule 40 of the Rules provides for „check posts‟ and prior to its amendment by Notification dated 4th July 2012 read as under:-
"40. Check Posts.- (1) Where the State Government decides to set up a check-post, under section 60 at any place in this State, the location of such check- post shall be notified in the official Gazette. When a check-post is set up on a thoroughfare or road, barrier may be erected, across the road or thoroughfare, in the Form of a contrivance to enable traffic being intercepted, detained and searched.
(2) No person shall transport across or beyond a check-post to any place outside the State of Bihar any goods notified under section 60 exceeding such quantity or value as may be specified in the notification, except after applying for grant of permission in Form D-VII in triplicate, before the officer incharge of the check post.
(3) Upon receipt of such application, the said authority or officer, on being satisfied about the particulars furnished, shall grant his permission by countersigning the declarations and seal them with his official seal; two copies of the permission shall be returned to the person filing it after endorsing on one of these copies the particulars of the authority or officer to whom it Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 18/49 shall be surrendered.
(4) The driver of the vehicle carrying the goods or the person in charge of the goods shall produce the countersigned permission, for inspection and checking at any other check post, which may fall in the route, and shall surrender one copy thereof to the authority or officer to whom he has been directed under sub-rule (3) to surrender it."
Since its amendment under Notification dated 4th July 2012 Sub-rule (2) of the above Rule 40 reads as under :
"(2)(a) No person shall transport across or beyond a check-post to any place outside the State of Bihar any goods other than those specified in Schedule-1 exceeding such quantity or value as the Commissioner may, by notification specify except after applying for grant of an obtaining an electronic transaction identification number on the official website of the Commercial Taxes Department.
(b) Every applicant referred to in clause (a) shall, in respect of consignments proposed to be transported as aforesaid, upload such details as the Commissioner may, by notification issued in this behalf, specify.
(c) Every application under clause (a) shall be processed, and the electronic transaction identification number generated and communicated to the applicant, in such manner as may be specified in the notification issued under Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 19/49 clause (b).
(d) The driver of the vehicle carrying the goods or the person incharge of the goods shall, upon demand, communicate the electronic transaction identification number granted in respect of the goods to the monitoring authority for verification who shall deal with the same in such manner as may be specified in the notification issued under clause (b).
(e) The manner in which the electronic transaction identification number is to be communicated for verification to the monitoring authority and the period for which the said number shall be valid may be specified in the notification issued under clause (b).
Explanation.1 - For the purposes of this sub-rule the expression "monitoring authority" shall mean -
(i) The Deputy Commissioner of Commercial Taxes, the Assistant Commissioner of Commercial Taxes, the Commercial Taxes Officer or the Assistant Commercial Taxes Officer exercising jurisdiction in respect of the concerned checkposts or any checkposts en route; or
(ii) The Deputy Commissioner or Commercial Taxes, the Assistant Commissioner of Commercial Taxes, the Commercial Taxes Officer or the Assistant Commercial Taxes Officer exercising jurisdiction in respect of any of the Circles en route; or Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 20/49
(iii) Any of the authorities exercising jurisdiction under section 86 in respect of any Bureau of Investigation en route.
Explanation 2. - The electronic transaction identification number generated under this sub- rule shall be deemed to be declaration for the purposes of section 60 and section 62."
(2) Sub-rule (3) and sub-rule (4) of rule 40 of the Bihar Value Added Tax Rules, 2005 shall be deleted."
Learned Advocates Mr. R K Agrawal and Mr. Purnendu Singh have appeared for the writ petitioners. The challenge to the impugned action of seizure of the vehicles and the goods and the imposition of the penalty are common. According to the learned Advocates, the goods in question were carried from one State to the other amounting to inter-State transfer. The goods in question were, therefore, exigible to tax under the Central Sales Tax Act, 1956 and were not liable to tax in the State of Bihar. If the goods were not liable to tax in the State of Bihar, the State of Bihar cannot have the authority to seize the goods or the carriers or to impose penalty under the guise of the evasion of tax. The action of the State of Bihar is thus illegal and unconstitutional. The learned Advocates have also made submission on merits of each case to convince the Court that in any view of the matter it cannot be the duty of the truck driver to submit the particulars of the consignment, consigner/s and the consignee/s. For failure of the truck driver to submit such particulars, no action can be taken in respect of the goods carried through the State of Bihar or the carrier. Moreover, if at all there were discrepancy in the information submitted at the check post, Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 21/49 it can be the goods alone which can be subjected to the penal action and not the carriers. In the submission of the learned Advocates, Section 60 of the 2005 Act which empowers the State Government to impose penalty on the goods carried through the State of Bihar is violative of Articles 301 and 304(b) of the Constitution. The learned Advocates have also challenged the validity of rule 40 of the Rules. The learned Advocates have submitted that Section 93 of the 2005 Act empowers the State Government to make rules but the State Government is not empowered to delegate any of its functions to any other authority. Under rule 40 of the Rules the State Government has delegated certain powers to the Commissioner of Commercial Taxes. The action of the delegation of powers to the Commissioner of Commercial Taxes is ultra vires Sections 93(1) and 93(2)(zzo) of the 2005 Act. It is further submitted that in exercise of power conferred by rule 40 of the Rules, the Commissioner of Commercial Taxes has issued Notifications dated 11th July 2012, 12th July 2012 and 30th October 2012. The said Notifications having been issued by the Commissioner of Commercial Taxes are violative of Section 93 of the 2005 Act and are null and void. It is also submitted that the Notifications dated 12th July 2012 and 30th October 2012 have not been notified in the Official Gazette as envisaged by Section 2(u) of the 2005 Act. The said two Notifications are, therefore, non est in the eye of law. No action, therefore, could have been taken against the goods and the carriers in question for violation of the said Notifications.
In support of his submissions, Mr. R K Agrawal has relied upon the judgments of the Hon‟ble Supreme Court and the High Courts in the matters of Ganpati Singhji vs. State of Ajmer (AIR 1955 SC 188); of Atiabari Tea Co. Ltd. vs. State of Assam Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 22/49 (AIR 1961 SC 232); of Deputy Commercial Tax Officer, Madras vs. Sha Sukraj Peerajee (AIR 1968 SC 67); of Sodhi Transport Co. vs. State of U.P. [(1986) 2 SCC 486]; of State of Haryana v. Sant Lal [(1993) 4 SCC 380]; of Agricultural Market Committee vs. Shalimar Chemical Works Ltd.[(1997) 5 SCC 516]; of Pramod K Pankaj vs. State of Bihar [(2004) 3 SCC 723]; of Rajendra Agricultural University vs. Ashok Kumar Prasad [(2010) 1 SCC 730]; of Surinder Singh Brar vs. Union of India [(2013) 1 SCC 403]; of The Check Post Officer, Coimbatore vs. K P Abdulla & Bros.[(1971) 27 STC-1 (SC)]; of M/s Sree Bahariji Mills Lrd. vs. State of Bihar & Others [AIR 1983 (Patna) 311]; and of Ram Naresh Singh vs. Chairman, Bihar State Agriculture Produce Market Board [1985 BRLJ-92].
In support of his submissions, Mr. Purnendu Singh has relied upon the judgments of the Hon‟ble Supreme Court in the matters of Commissioner of Commercial Taxes, Board of Revenue, Madras vs. R S Jhaver (AIR 1968 SC 59); of The Check Post Officer, Coimbatore vs. K P Abdulla & Brothers (AIR 1971 SC 792); of M/s Sodhi Transport Co. vs. State of U.P. (AIR 1986 SC 1099); of T Narasimhulu vs. State of Andhra Pradesh [(2010) 6 SCC 545], of State of Haryana vs. Sant Lal [(1993) 91 STC 321 (SC)]; and of Hindustan Steel Ltd. vs. State of Orissa [(1970) 25 STC 211 (SC)] .
The Petitions are contested by the State Government. Learned Principal Additional Advocate General Mr. Lalit Kishore has appeared for the State of Bihar. At the outset we may note that Mr. Lalit Kishore has conceded that till the date of the writ petitions the above-referred Notifications dated 12th July 2012 and 30th October 2012 issued by the Commissioner of Commercial Taxes were not notified in the Official Gazette. He Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 23/49 has submitted that in course of hearing of the writ petitions the said Notifications have been published in the Official Gazette dated 11th July 2013. He has further submitted that it is not mandatory to publish the Notification issued by the Commissioner of Commercial Taxes in exercise of power conferred by rule 40 of the Rules in the Official Gazette. It is a mere directory provision. He has relied on various provisions, viz. Section 9(4) of the 2005 Act to buttress his submission that publication of the Notification in the Official Gazette is not mandatory. He has submitted that wherever the requirement of publication in Official Gazette is mandatory, the State legislature has expressly provided for "notification published in the Official Gazette". He has further submitted that the definition of the word "notification" occurring in Section 2(u) of the 2005 Act will not govern the legislative intention. In support thereof, he has relied upon the judgments in the matters of Harla v. The State of Rajasthan (AIR 1951 SC 467); of Bangalore Woollen, Cotton and Silk Mills Co. v. Bangalore Corporation (AIR 1962 SC
562); and of Rai Vimal Krishna v. State of Bihar [(2003) 6 SCC 401]. Mr. Lalit Kishore has also relied upon the judgments in the matters of Guljag Industries v. Commercial Taxes Officer [(2007) 7 SCC 269] and of Assistant Commercial Taxes Officer v. Bajaj Electricals Limited [(2009) 1 SCC 308].
At the outset, we must record that the impugned orders made in exercise of powers conferred by Section 60(4) of the 2005 Act are appealable under Section 72 of the 2005 Act. If aggrieved, the writ petitioners ought to have challenged the orders of seizure and penalty. The person aggrieved, that is, the owner of the goods or the owner of the vehicle, has an alternative statutory remedy of appeal before the higher forum. It is the Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 24/49 appellate authority alone which could have meticulously examined the facts of the case and made the order keeping in view the emerging facts. This Court exercising power of judicial review under Article 226 of the Constitution will not enter into the niceties of the factual matrix to find out whether or not the disclosure made by the truck driver was true and complete, whether there was any material discrepancy and, whether or not on facts, the impugned order of seizure and penalty are justified.
It is not in dispute in any of the writ petitions that the disclosure made by the driver was not true / complete. Section 60 of the 2005 Act, inter alia, empowers the State Government to establish the check posts and barriers with a view to preventing evasion of tax payable under the 2005 Act. Sub-section (2) of Section 60 enjoins the person transporting the goods (subject to exception) to submit the particulars in the required form and manner before he crosses the barrier. The submission made by Mr. Purnendu Singh that the truck concerned had not entered the territory of the Bihar State and that it was waiting outside the check post is of no avail. True and complete disclosure is required to be made before the truck crosses the barrier at the check post. In case where the driver or the person in-charge of the goods fails to make true and complete disclosure, such failure gives rise to a presumption of intention to avoid tax. The failure to make true and complete disclosure thus gives rise to statutory presumption of intention to avoid payment of tax under the 2005 Act. In such case, the authorities concerned are enjoined to seize the goods and the vehicle or the carrier and to impose penalty, three times the tax assessed on the goods. The authorities at the check posts have no discretion to act in any manner other than the one provided under Section 60(4) read with Section 56(4) of the Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 25/49 2005 Act.
In the present set of facts, in absence of the challenge to the factum of failure of the driver or the person in-charge of the goods to make true and complete disclosure at the barrier, the challenge to the action of the respondent authorities in seizing the goods and the carriers and of imposing the penalty, three times the tax assessed on the goods, has to be rejected. The respondent authorities have acted in discharge of their official duty. The action of the respondents, therefore, cannot be said to be arbitrary or illegal.
As to the release of the offending vehicles, we must note that with respect to the incident in question the authorities have filed a police complaint. The matters have thus become police case, and the goods and the trucks are in the police custody. The only remedy to the writ petitioners for release of the trucks would be before the concerned Magistrate under Section 451 Cr.P.C.
Now we shall examine the constitutional validity of Section 60(4) of the 2005 Act and the Notifications dated 4th July 2012 and 12th July 2012.
Article 301 of the Constitution deals with the "freedom of trade, commerce and intercourse" and reads, "subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free". Learned Advocates Mr. R K Agrawal and Mr. Purnendu Singh have vehemently submitted that it is the constitutional mandate that the transport of goods throughout the country shall be free. In other words, no tax or fee is chargeable for transport of goods through the territory of a State. Article 303 of the Constitution imposes bar upon the legislative power of the Union and the Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 26/49 States from making any legislation with regard to trade and commerce. Thus the goods carried by the writ petitioners from one State to the other are not exigible to a tax or charges at the hands of the States through which the goods are carried. Nevertheless, the State of Bihar has enacted Section 60(4) of the 2005 Act so as to levy tax on such goods in the guise of imposition of penalty. Mr. Purnendu Singh has submitted that in case such a law were required to be made in public interest, the State could not have made such law without the previous sanction of the President. Admittedly, before enacting Section 60(4) of the 2005 Act sanction of the President is not obtained. Section 60(4) of the 2005 Act is violative of Article 304(b) of the Constitution.
We are afraid we are unable to agree with the learned Advocates. It is evident that it is not the goods which are carried through the State of Bihar which are subjected to the penal action under Section 60(4) of the 2005 Act. Section 60 of the 2005 Act applies not only to the goods in transit through the State of Bihar, it applies to all goods which are brought in the State of Bihar. The goods may have been brought for sale or use in the State of Bihar or the goods may have been brought for passing through the State of Bihar. All that it requires is a true disclosure. Failure to make true disclosure gives rise to a presumption of intention of evasion of tax. The Section also provides for a machinery to compel the transporters to make the true disclosure. Under Section 60(2) of the 2005 Act, a duty has been cast upon the driver or the person in charge of the goods brought in the State of Bihar to declare the true and complete particulars as may be prescribed. In case of failure to disclose the true and complete particulars, the intention to avoid the tax under the 2005 Act is presumed. The moment the aforesaid statutory presumption is raised, the bar imposed by Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 27/49 Articles 301 and 303 of the Constitution in respect of the goods transported through the State will have to make room for State Legislature. Evidently, Sections 60(3) and 60(4) of the 2005 Act come into play only when the goods are presumed to be brought for sale or use in the State of Bihar and that the request for transit pass for out to out transit is not genuine. Clearly the provision is deterrent. We see no illegality or violation of Articles 301 and 303 of the Constitution in Section 60(4) of the 2005 Act. Since the said provision is invoked in case of the goods which are believed to have been brought in the State for sale or use in the State, Article 304(b) of the Constitution is not attracted, the question of previous sanction of the President does not arise. We, therefore, reject the challenge to the constitutional validity of Section 60(4) of the 2005 Act. Section 60(4) of the 2005 Act is not ultra vires Articles 301, 303 or 304(b) of the Constitution of India.
It is not for the first time that such a provision is made in the 2005 Act. Similar provisions are found in other taxing statutes with a view to counteracting evasion of tax. As early as in 1961, in the matter of Baldeo Singh (AIR 1961 SC
736) a similar issue arose in respect of the Indian Income Tax Act, 1922. The challenge was to the validity of Section 23A of the said Act as it stood on 11th June 1947 on the ground of legislative competence vis-a-vis Entry 54 of List-I in the Seventh Schedule to the Government of India Act, 1935. Under the said Section, the undistributed income of a company was, "deemed to have been distributed as dividend amongst the shareholders as at the date of the general meeting", being the meeting at which the accounts for the year concerned were passed, and "thereupon, the proportionate share of each shareholder shall Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 28/49 be included in the total income of such shareholder for the purposes of assessing his total income." The Constitution Bench of the Hon‟ble Supreme Court headed by Hon‟ble Chief Justice B P Sinha held that Section 23A was enacted for preventing evasion of tax and that the Section was within Entry
54. This judgment was followed in the matter of Gursahai Saigal (AIR 1963 SC 1062). The matter of Gursahai Saigal arose from an order of assessment under the Indian Income-Tax Act, 1922. A similar challenge to Section 18A of the 1922 Act was the subject matter of consideration by the Hon‟ble Supreme Court. The Hon‟ble Court distinguished the provisions of a taxing statute those which are charging provisions, those which are procedural or which provide machinery and those which are enacted with a view to making substantive provisions workable. The Hon‟ble Court upheld the validity.
In the matter of Ramkishan Srikishan Jhaver (AIR 1968 SC 59) a Constitution Bench of the Hon‟ble Supreme Court had occasion to examine the constitutional validity of the power to seize and confiscate goods conferred upon the authority under sub-section (4) of Section 41 of the Madras General Sales Tax Act (1 of 1959). The Madras High Court had struck off the relevant sub-section (4) of Section 41 of the Madras Act for want of legislative competence. According to the Madras High Court, the power to seize and confiscate the goods was not incidental or ancillary to "Tax on sale and purchase of goods" in Item 54 List II of the Seventh Schedule to the Constitution. Although the Hon‟ble Court affirmed the order of the Madras High Court on other grounds, the Hon‟ble Court held that Entry 54 in List II of Schedule VII of the Constitution must be given widest possible Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 29/49 interpretation.
These judgments were followed in the matter of Sodhi Transport Company (AIR 1986 SC 1099). In the matter of Sodhi Transport Company, the Hon‟ble Supreme Court was called upon to examine the constitutional validity of a similar provision in Section 28B of the U.P. Sales Tax Act, 1948. Section 28B of the said Act read with Rule 87 of the Rules made under the said Act enjoined the driver or the person in-charge of the vehicle to surrender the copy of the transit pass at the exit check post. The failure to surrender the transit pass would give rise to the presumption that the goods had been sold within the State of U.P. The said presumption would entail liability to pay tax under the said Act. The constitutional validity of the aforesaid Section 28B and Rule 87 was the subject matter of challenge. The Hon‟ble Court followed the judgments of the Supreme Court in the matters of Baldeo Singh (AIR 1961 SC 736) and of Gursahai Saigal (AIR 1963 SC 1062) to hold the said provisions intra vires. The Hon‟ble Court held that the provisions contained in the aforesaid Section 28B of the Act and Rule 87 of the Rules were the machinery provisions. They were enacted to ensure that a person who had brought the goods inside the State and who had made a declaration that the goods were brought into the State for the purpose of carrying them outside the State should actually take them outside the State. The Hon‟ble Court also held that the words "it shall be presumed" was rebuttable presumption and that the dealer or the person in-charge of the goods may rebut the said presumption by producing the evidence. The Hon‟ble Court held that the law made to prevent evasion of tax was ancillary or incidental within the purview of Entry 54 of List II of Schedule VII to the Constitution and that the said provisions were within Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 30/49 the competence of State Legislature. The Hon‟ble Court further held, "The levy of sales tax on goods which are held to have been sold inside the State cannot be considered as contravening Art. 301 of the Constitution. The restrictions imposed are not also shown to be unreasonable. They do not unduly hamper trade. On the other hand they are imposed in the public interest. The contentions based on Art. 301 and Art. 19(1)(g) of the Constitution are, therefore, without substance."
In the matter of Harihar Prasad Debuka (AIR 1989 SC 1119) the challenge was against the prescription of forms under the Bihar Finance Act for declaration of particulars of goods carried on goods carrier for transporting of goods through the State of Bihar as violative of Articles 301, 304(b) and 19(1)(g) of the Constitution. The Patna High Court held that the notification imposed unwarranted restrictions on inter-State trade and commerce. The Hon‟ble Supreme Court set aside the judgment of the High Court. The Hon‟ble Court held that the declaration forms did not prohibit transportation of the goods. The Hon‟ble Court upheld the legislative competence of the State of Bihar as well as the constitutional validity on the touchstone of Articles 301, 304(b) and 19(1)(g) of the Constitution.
In the matter of Hindustan Steel Ltd. [(1970) 25 STC 211] the challenge was against the penalty imposed under the Orissa Sales Tax Act, 1947. The appellant was visited with penal consequences for its failure to get registration under the Orissa Sales Tax Act. The Hon‟ble Court held that the failure on the part of the appellant-company to register the company as a dealer was under honest and genuine belief that the company was not a dealer. In view of the bona fide error, the Court held no case Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 31/49 for imposing penalty was made out. Under the Act penalty may be imposed for failure to register as a dealer. The Court held, "the liability to pay penalty does not arise merely upon proof of default in registering as a dealer. An order imposing penalty for failure to carry out a statutory obligation is the result of a quasi-criminal proceeding, and penalty will not ordinarily be imposed unless the party obliged either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not also be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act or where the breach flows from a bona fide belief that the offender is not liable to act in the manner prescribed by the statute." This judgment is clearly distinguishable. This decision will apply with all force where the authority has discretion to impose penalty. In the present case, Section 60(4) of the 2005 Act is mandatory and leaves no discretion to the authorities.
In the matter of The Check Post Officer, Coimbatore (AIR 1971 SC 792) the Constitution Bench of the Hon‟ble Court was called upon to examine the constitutional validity of power to seize and confiscate the goods and to levy penalty conferred by Section 42(3) of the Madras General Sales Tax Act (1 of 1959). The Hon‟ble Court upheld the view of the Madras High Court Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 32/49 and held that such power was not incidental or ancillary to Entry 54 of List II of the Seventh Schedule to the Constitution. The State Legislature was, therefore, not competent to make such rules.
In the matter of Sant Lal [1993(4) SCC 380] the subject matter of challenge was the power to impose penalty. The Haryana General Sales Tax Act, 1973 and the Rules made thereunder, enjoined the clearing or forwarding agent of the dealers to disclose certain information in respect of the goods and the consigner and the consignee and empowered the authorities to impose penalty in case of failure. The Hon‟ble Court set aside the concerned provisions and held that the clearing or forwarding agents were not the dealers. They were not liable to pay sales tax nor were they responsible for the evasion nor was there any reasonable and proximate connection between the transaction of sale and the clearing or forwarding agent. In respect of the competence of the State Legislature, the Court observed, "there can, therefore, be no doubt that the State Legislature had by reason of Entry 54 of List II in the Seventh Schedule to the Constitution the power to legislate in respect of taxes on the sale or purchase of goods, and it had, therefore, the power to legislate with respect to the imposition of a sales tax, to prescribe the machinery for the collection of such tax, to designate officers by whom such liability could be enforced and in respect of all matters ancillary or subsidiary thereto which could fairly and reasonably be said to be comprehended within the legislative entry. Having regard to the analysis of the said Section 38 and the relevant rules and forms made hereinabove, the question is whether the same can be said to be ancillary or subsidiary matters which are Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 33/49 fairly and reasonably comprehended within the power to levy sales tax."
In the matter of Sha Sukraj Peerajee (AIR 1968 SC
67) the constitutional validity of the Madras General Sales Tax Act (9 of 1939) and the rules made thereunder was the subject matter of consideration before the Hon‟ble Supreme Court. The Hon‟ble Court held that the effective date of the relevant provision was the date on which it was sent for assent by the President. The Hon‟ble Court held that the impugned rule 21A framed under the rule making power had the effect of enlarging the scope of Section 10 recovering the tax from a person other than dealer and thus was ultra vires the Act. This judgment is in peculiar facts of the case. It is not an authority in the subject matter on our hand.
True, in the matter of Atiabari Tea Company Limited (AIR 1961 SC 232) the Hon‟ble Supreme Court has taken a contrary view. The challenge was against the Assam Taxation (on Goods carried by Roads or Inland Waterways) Act on the ground of lack of legislative competence of the State of Assam and being violative of Article 301 and Article 304(b) of the Constitution. The Constitutional Bench of the Hon‟ble Supreme Court held, "when Article 301 provides that trade shall be free throughout the territory of India primarily it is the movement part of the trade that it has in mind and the movement or the transport part of trade must be free subject of course to the limitations and exceptions provided by the other Articles of Part XIII. That we think is the result of Article 301 read with the other Articles in Part XIII." The Hon‟ble Court further analyzed the requirements under Articles 302 and 304(b) of the Constitution. The Hon‟ble Court held that Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 34/49 Article 304(b) requires not only that the law should be in the public interest and should have received previous sanction of the President but that the restrictions imposed by it should also be reasonable. The relevant provision was held to be "a restriction in the form of taxation on the carriage or movement of goods, and we hold that such a restriction can be imposed by the State Legislature only if the relevant Act is passed in the manner prescribed by Article 304(b)." The relevant provision was declared void as having been made in contravention of Article 304(b) of the Constitution. It is indeed a view expressed by the Constitutional Bench. We may however note that in the said judgment the Hon‟ble Supreme Court did not take notice of the judgment of the Constitutional Bench in the matter of Baldeo Singh (AIR 1961 SC 736) and in the matter of Gursahai Saigal (AIR 1963 SC 1062). The said judgment is, therefore, per incurium the judgment in the matter of Baldeo Singh. Even after the judgment in the matter of Atiabari Tea Company Ltd., the Hon‟ble Supreme Court has consistently followed the judgment in the matter of Baldeo Singh (AIR 1961 SC 736).
In the matter of Guljag Industries [(2007) 7 SCC 269] a similar question of imposition of penalty under Section 78(5) of the Rajasthan Sales Tax Act, 1994 came up for consideration before the Hon‟ble Supreme Court. The Hon‟ble Court held that Section 78(2) of the Rajasthan Act is a mandatory provision and non-compliance therewith would entail penalty under Section 78(5) of the Rajasthan Act. Section 78 of the Rajasthan Act is in pari materia identical to Section 60 of the 2005 Act. Section 78(2) of the Rajasthan Act enjoins the driver or the person in-charge of a vehicle or carrier of goods in movement, inter alia, to carry with him goods vehicle record.
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 35/49Sub-section (5) thereof enjoins, inter alia, the officer in-charge of the check post to impose penalty for violation of Section 78(2)(a) of the Rajasthan Act. The Hon‟ble Court held that there is no scope for waiver of penalty for contravention of Section 78(2). The Hon‟ble Court rejected the contention that it was open to the assessee to establish absence of intention to evade tax from documentary evidence like invoice, books of accounts, etc. The Hon‟ble Court also rejected the contention that in certain cases of inter-State transaction, the assessees were not liable for being taxed under the Rajasthan Act and, therefore, the penalty for contravention of Section 78(2) could not be imposed. The Hon‟ble Court held, "It is for contravention of Section 78(2) that penalty is attracted under Section 78(5). Whether the goods are put in movement under local sales, imports, exports or inter-State transactions, they are goods in movement, therefore, they have to be supported by the requisite declaration. It is not open to the assessee to contravene and say that the goods were exempt. Without disclosing the nature of transaction it cannot be said that the transaction was exempt. The Hon‟ble Court further held, "we are of the view that mens rea is not an essential element in the matter of imposition of penalty under Section 78(5)." Mr. Purnendu Singh has submitted that this judgment has not noticed the earlier judgment in the matter of Atiabari Tea Company Limited (AIR 1961 SC 232), the judgment is, therefore, per incurium.
In the matter of Bajaj Electricals Ltd. [(2009) 1 SCC 308], a somewhat similar matter of imposition of penalty for violation of the requirements under Section 78 of the Rajasthan Sales Tax Act, 1994 came up for consideration before the Hon‟ble Supreme Court. The High Court had held the action of Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 36/49 imposition of penalty under Section 78(5) of the Rajasthan Act to be bad on the grounds that the presumption of intention to evade tax arising under Section 78(2) of the Rajasthan Act was rebuttable and any disclosure in the required form the authorities below were duty bound to examine the other materials to ascertain the intention to evade tax or the absence of such intention. In absence of mens rea no penalty under Section 78(5) of the Act could be imposed. The Hon‟ble Supreme Court did not approve the said judgment. The Court held that mens rea is not an essential ingredient for offence under Section 78(2) of the Rajasthan Act; the fact that the required form was duly signed without entering the particulars in the form, had established mens rea (intention to evade tax).
Earlier, in the matter of State of Rajasthan v. D P Metals [(2002) 1 SCC 279] also the Hon‟ble Supreme Court had occasion to consider the very provision of the Rajasthan Act. The Hon‟ble Court held that if the declaration submitted were false or forged, the penalty under Section 78(5) of the Rajasthan Act was leviable. The Hon‟ble Court further held that there was no discretion with the officer to reduce the amount of penalty or to waive the penalty. Although the Hon‟ble Supreme Court in the later judgment in Guljag Industries (supra) and Bajaj Electricals Ltd. (supra) did not agree with the proposition that the presumption raised for contravention of Section 78(2)(a) of the Rajasthan Act was rebuttable.
We have now before us three judgments of the Constitution Bench of the Hon‟ble Supreme Court in the subject matter. The Constitution Bench in the matters of Baldeo Singh (supra) and Atiabari Tea Company Ltd. (supra) were headed by Hon‟ble Chief Justice B P Sinha; two Judges (the Chief Justice Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 37/49 and Mr. J C Shah, J.) being common. In the matter of Baldeo Singh, the Hon‟ble Court upheld the law which imposed penalty. The Court held that the provision enacted to make the substantive provision workable is ancillary and incidental to the relevant Entry and that it was valid. However, the similar provision to levy penalty in the Assam Taxation (on Goods carried by Road or Inland Waterways) Act was held to be beyond legislative competence by majority. (Hon‟ble B P Sinha, CJ, dissented). The said judgment has been followed by the Constitution Bench headed by Hon‟ble Mr. Justice J C Shah in the matter of The Check Post Officer, Coimbatore (supra). The power to seize and confiscate the goods and levy penalty under the Madras General Sales Tax Act (1 of 1959) was held to be not ancillary or incidental to "Taxes on sale or purchase of goods."
Yet another Constitution Bench of the Supreme Court in the matter of R S Jhaver (AIR 1968 SC 59) headed by the then Chief Justice K N Wanchoo considered similar provisions of search and seizure under Section 41 of the Madras General Sales Tax Act (1 of 1959). The Hon‟ble Bench kept the question "whether a power to confiscate goods which are found on search and which are not entered in account books of the dealer is an ancillary power necessary for the purpose of stopping evasion of tax" open.
We may note that apart from the aforesaid two judgments all along prior to 1971 and after 1971 till the date the judgment in the matter of Baldeo Singh has been followed by the various Benches of the Hon‟ble Supreme Court. The said judgment has, with aforesaid exception, ruled the country for more than fifty years. We will prefer to follow suit.
In a nutshell, once a statutory presumption of Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 38/49 intention to sale or use of goods within the State and of intention to avoid tax is raised, the machinery prescribed for collection of tax is ancillary and incidental to the "Taxes on the sale or purchase of goods" under Entry 54 of List II of Schedule VII to the Constitution.
Considering the above judgments we have no doubt that the State Legislature is competent to raise legal presumption of intention to avoid tax and to legislate a machinery to prevent tax evasion.
Section 93 of the 2005 Act empowers the State Government to make rules to carry out the purposes of the Act. It is true that the said Section does not empower the State Government to delegate its rule making power to the authority below. In other words, the rule making power has to be exercised by the State Government and the said power vests exclusively in the State Government. But the State Government is not debarred from delegating its executive powers under the 2005 Act by making appropriate provisions in the rules. In our view, the submission that under the rules framed by the State Government, State Government cannot delegate power to any authority below is fallacious, misconceived and requires to be rejected outright. We may note that Section 10 of the 2005 Act specifically provides for appointment of certain authorities for carrying out the purposes of the Act. Thus it is the authorities appointed under Section 10 of the Act who are required to carry out the purposes of the Act. To enable / facilitate the said authorities to carry out the purposes of the Act, if the said authorities are vested with certain powers to carry out the provisions of the Act and the rules made thereunder, the same would not offend the Constitution of India or the 2005 Act.
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 39/49Rule 40 of the Rules, before its amendment on 4th July 2012 provided, inter alia, for the manner in which the check posts may be set up by the State Government. Sub-rule (3) thereof enjoined certain authority or officer, on being satisfied about the particulars furnished, to grant permission. Sub-rule (4) thereof enjoined the driver of the vehicle to submit a copy of the transit permission at the exit check post. The said Rule 40 has now been amended under the Government Notification dated 4th July 2012. Under the amended Rule 40, a revised procedure has been prescribed for disclosure of the particulars and for issue of the transit pass. It is evident that the said amendment is necessitated on account of the modern technology. Instead of manual intervention, now under the revised rule, the required declaration is auto generated by employing the electronic technology. Under the amended Rule 40 the driver or the person in-charge of the goods is required to feed the particulars in the required digital form and the digital data fed to the system automatically generates the declaration required to be filed under Section 60(2) of the 2005 Act. Under the amended Rule 40 the Commissioner of Commercial Taxes has been empowered, inter alia, to notify the date from which the said amendment would become effective; to notify the quantity or the value of the goods that can be transported across a check post without the Transaction, Identification Number (TIN). The Commissioner of Commercial Taxes has been empowered to notify the particulars which would be required to be entered into the system, etc. In exercise of power conferred by Rule 40(2) of the Rules, the Commissioner of Commercial Taxes has issued notification dated 11th July 2012 to make the said Sub-rule (2) of Rule 40 effective from 16th July 2012. We see no substance in the challenge to the Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 40/49 said Rule 40 or the Notification dated 11th July 2012. The powers conferred upon the Commissioner or the other authorities appointed under the 2005 Act cannot be said to be the delegation of power without the authority, nor does it amount to excessive delegation. The contention that sub-rule (2) of Rule 40 of the Rules offends Section 93(zzo) is not tenable. Clause (zzo) of Sub- section (2) thereof provides for "the manner of obtaining transit permission under Sub-section (11) of Section 62." The power conferred upon the Commissioner of Commercial Taxes is not that of rule making power of the State Government under Section 93(2) (zzo) of the 2005 Act.
In the matter of Agricultural Market Committee [(1997) 5 SCC 516] one of the issues was the validity of the rules and the bye-rules under the Andhra Pradesh (Agricultural Produce and Livestock) Markets Act, 1966. The Hon‟ble Court held that the delegate who is empowered to make subsidiary rules and regulations has to work within the scope of its authority and cannot widen or restrict the scope of the Act or the policy or principle laid down therein.
In the matter of Ganpati Singhji (supra) challenge was against the action of the District Magistrate in respect of grant of permission to hold a fair. The Hon‟ble Supreme Court noticed that under the relevant Regulations the Chief Commissioner was empowered to make rules for the establishment of a system of conservancy and sanitation. The Hon‟ble Court set aside the rule which empowered the District Magistrate to make order.
The judgments in the matter of Pramod K Pankaj [(2004) 3 SCC 723] and in the matter of Surinder Singh Brar [(2013) 1 SCC 403] are distinguishable on their own facts.
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 41/49Now we shall come to the Notifications dated 12th July 2012 and 30th October 2012 issued by the Commissioner of Commercial Taxes-cum-Chief Secretary in exercise of power conferred by sub-rule (2) of Rule 40 of the Rules. At the outset, we must say that we do not agree with Mr. Lalit Kishore that requirement of publication in the Official Gazette is directory and not mandatory. The said sub-rule is specific in so far as it provides, "Commissioner may, by notification". The word "notify" is defined in clause (u) of Section 2 of the 2005 Act to mean "a notification published in the Official Gazette". In our opinion, no Notification would be complete / effective without its publication in the Official Gazette.
Section 28 of the Bihar & Orissa General Clauses Act, 1917 also provides for publication of orders or notifications in the Official Gazette. It reads -
"28. Publication of orders and notifications in the Official Gazette. - Where in any Bihar and Orissa Act (or Bihar Act) or in any rule made under any such Act, it is directed that any order, notification or other matter shall be notified, or published, such notification or publication shall, unless the Act otherwise provides, be deemed to be duly made if it is published in the Official Gazette."
As we have recorded hereinabove, wherever the 2005 Act requires notifying rule or notification, it necessarily means notification in the Official Gazette. Even in absence of a specific provision in the Act or the Rules, the aforesaid Section 28 requires publication of the notification in the Official Gazette.
We, therefore, hold that the Notification issued by the Commissioner of Commercial Taxes in exercise of power Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 42/49 conferred by sub-rule (2) of Rule 40 of the Rules is required to be compulsorily published in the Official Gazette. Such Notification cannot be made effective unless and until it is published in the Official Gazette. The said Notifications read as under:
^^ vf/klwpuk la[;k&5441 fnukad& 12 tqykbZ] 2012 & fcgkj eqY; of)Zr dj fu;ekoyh] 2005 ds fu;e 40 ds mi&fu;e ¼2½ }kjk iznRr "kfDr;ksa dk iz;ksx djrs gq, vf/kfu;e ds v/khu fdlh ifjogudRrkZ@ O;olk;h }kjk vFkok mudh vksj ls jkT; ls gksdj xqtjus okys eky ds ifjogu ds fy, fuEu izfdz;k fufnZ'V djrs gSa %& 2- jkT; ls gksdj xqtjusokys eky dk ifjogu & bl gsrq ifjogudRrkZ dks foHkkxh; osclkbZV www.biharcommercialtax. gov.in ij V~zkathV ikl ds fy, ^^lqfo/kk** vkbZdkWu esa T-TAN (Transporter Transaction Access Number) ls lacaf/kr vkbZdkWu ij fDyd djuk gksxk A fDyd djrs gh ifjogudRrkZ dks vius uke] irk] izkf/kd`r O;fDr] iSu vFkok cSad ,dkmUV uEcj] VsfyQksu uEcj vkfn fooj.k dks Hkj dj mDr gsrq vius vkidks fucaf/kr djuk gksxk rFkk mls viuk ikloMZ ,oa security question and answer ls fpfUgr djuk gksxk A 2-1 blds i"pkr~ ifjogudRrkZ dks T-TAN la[;k vkoafVr gks tk,xh ,oa blds ckn Hkfo'; esa mUgsa osc&lkbV ij mlh ykWx&bu vkbZ0 Mh0 ,oa ikloMZ dk iz;ksx dj lqfo/kk tfur dj ldsaxs A 2-2 ifjogudRrkZ }kjk foHkkxh; osclkbZV ij ekyksa ds vk;kr lacaf/kr Icon dks Click djrs gq, [kqyusokys Qkje dks Hkjk tkuk gksxk ,oa bl Qkje esa oSlh lwpuk,Wa gh fofgr gS tks orZeku ds Qkje D-VII esa Hkjh tkrh gS A bu lwpukvksa ds Hkjs tkus ds mijkar Submit Button Click djus ij mDr Qkje Lor% foHkkxh; osclkbZV@ MkVkcsl esa viyksM gks tk;sxh A KkrO; gS fd ;g lwpuk jkT; esa izos"k ds iwoZ dHkh Hkh ,oa dgha ls Hkh viyksM dh tk ldrh gS] 2-3 lwpuk viyksM gksrs gh ,d ikorh jlhn flLVe }kjk tsusjsV gksxh ftl ij 16 vadksa dh fof"k'V la[;k vafdr gksxh A bl ikorh dk fizaV vkmV ifjogudRrkZ }kjk fy;k tk ldsxk ,oa fizaV vkmV ugha fy, tkus ds n"kk esa Hkh dksbZ dfBukbZ ugha gksxh] 2-4 jkT; esa izfof'V ds tkWap pkSdh ij V~zd esa ynsa lHkh lEizs'k.kksa ls Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 43/49 lacaf/kr 16 vadksa dh fof"k'V igpku la[;k pkyd }kjk tkWap pkSf d ij inkf/kdkjh@dehZ dks miyC/k djk;k tkuk gksxk ,oa bl la[;k dks inkf/kdkjh@dehZ }kjk flLVe esa izfo'V fd;k tk;sxk] 2-5 mDr la[;k ds izfo'V gksrs gh V~zd esa ynsa mDr lEizs'k.k ls lacaf/kr iwoZ esa viyksM dh xbZ lkjh lwpuk,Wa voyksdu gsrq Ldzhu ij miyC/k gksxh A tkWap pkSdh ij blds lR;kiu ds mijkar V~zd dks vkxs ifjogu dh vuqKk nh tk;sxh ,oa ;g rF; Hkh dEI;wVj esa izfo'V gksxk A tkWap dh bl izfdz;k esa lkekU;r% vksSlru 1 ls 2 feuV dk le; yxsxk] 2-6 tkWap pkSdh ds mijkar ekxZLFk fdlh tkWap ny }kjk Hkh bldh tkWap vkWu&ykbZu dh tk ldrh gS ,oa ml ifjfLFkrh esa pkyd }kjk iwoZ dh gh HkkWafr 16 vadksa dh fof"k'V igpku la[;k gh miyC/k djokbZ tkuh gS ,oa ,sls esa lEizs'k.k ds C;kSjs ds vfrfjDr tkWap ny dks Ldzhu ij ;g lwpuk Hkh miyC/k gksxh fd bl V~zd dk ijh{k.k tkWap pkSdh ij gks pqdh gS] 2-7 jkT; esa izfo'Vh tkWap pkSdh ls nkf[ky gksus ds 72 ?kaVksa ds vanj mDr lEizs'k.k dks jkT; ds fudklh tkWap pkSdh ls fudy tkuk gksxk ,oa fudklh tkWap pkSdh ij rSukr tkWap nyksa dks flLVe ls ;g lwpuk miyC/k gksxh fd mDr igpku la[;k ls lacaf/kr V~zd jkT; esa dc nkf[ky gqvk Fkk A 72 ?kaVksa ls vf/kd dh vof/k O;rhr gksus dh n"kk esa fu;ekuqlkj ;qfDr;qDr dkj.kksa ls mDr lEizs'k.k dks jkT; ls fudklh dh vuqKk nh tk ldsxh] 2-8 KkrC; gS fd dEI;wVj esa izfo'V gksus ds i"pkr~ mDr igpuk la[;k dk fooj.k flLVe esa vafdr gks tk;sxk rkfd bldk nq:Ik;ksx ugha gks lds] 3- bl i= esa fn, x, funs"kksa dk vuqikyu lqfuf"pr fd;s tk;sa A 4- ;g vkns"k fnukad 16 twykbZ] 2012 ds izHkko ls izo`Rr gksxk A** ^^ vf/klwpuk la[;k& 6888 fnukad 30 vDVwcj] 2012 & fcgkj ewY; of)Zr dj fu;ekoyh] 2005 ds fu;e 40 ds mi&fu;e ¼2½ }kjk iznRr "kfDr;ksa dk iz;ksx djrs gq, vf/kfu;e ds v/khu iwoZ esa fuxZr foHkkxh; vf/klwpuk la[;k 5441] fnukad 12 tqykbZ] 2012 esa fofufnZ'V izfdz;k esa fuEukafdr la"kks/ku djrs gSa %& 1- vkmV&Vq&vkmV V~zkaftV ikl ds fuxZeu gsrq fucaf/kr ifjogudRrkZvksa }kjk vius fuca/ku dks viMsV fd;k tkuk gksxk ,oa u;s ifjogudRrkZvksa dks u;k fuca/ku izkIr djus gsrq fuEufyf[kr lwpuk,Wa Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 44/49 foHkkxh; dEI;wVj iz.kkyh esa izfo'V fd;k tkuk vfuok;Z gksxk %& ¼d½ ifjogudRrkZ dk uke] ¼[k½ ifjogudRrkZ daiuh ds LoRo/kkjh@ funs"kd@ eq[;
dk;Zikyd inkf/kdkjh dk uke] ¼x½ ifjogudRrkZ ;k ifjogudRrkZ daiuh ds LoRo/kkjh@ funs"kd@ eq[; dk;Zikyd inkf/kdkjh dk iSu (PAN), ¼?k½ eksckbZy ;k nwjHkk'k la[;k ¼nksuksa esa ls dksbZ ,d½ A 2- Hkkjr ds fdlh jkT; ls fdlh nwljs jkT; esa eky ds ifjogu djus ds dze esa fcgkj ls gksdj xqtjus okys lHkh okguksa ij ifjofgr fd;s tk jgs ekyksa ds lanHkZ esa ifjogudRrkZ }kjk] dj eqDr ekyksas ds ifjogu dks NksM+ dj] consignor dk TIN ,oa consignee dk TIN Hkjk tkuk vfuok;Z gksxk A dj eqDr ekyksa ds ifjogu ds fufeRr p;u fd;s tkus ij flLVe }kjk consignor ,oa consignee dk TIN Lor% Hkjk tk;sxk A 3- Hkkjr ds ckgj ls vk;kr fd;s tk jgs ,sls eky ftudk ifjogu fcgkj jkT; ls gksdj fdlh vU; jkT; dks fd;k tk jgk gS ds lanHkZ esa consignor TIN nsus dh ck/;rk ugha gksxh A blh izdkj Hkkjr ds fdlh jkT; ls Hkkjr ds ckgj ekyksa ds fu;kZr ds dze esa ;fn ekyksa dk ifjogu fcgkj jkT; gksdj fd;k tkrk gks rks ,sls ekeys esa consignee TIN nsus dh ck/;rk ugha gksxh A ,sls ekeyksa esa ;fn ifjogudRrkZ }kjk Hkkjr ds ckgj ds fdlh ns"k dk p;u fd;k tkrk gS rks flLVe }kjk consignor ,oa consignee dk TIN Lor% Hkjk tk;sxk A 4- vkmV&Vq&vkmV dh lqfo/kk generate djrs le;
ifjogudRrkZ dks iwoZ esa gh laHkkfor Entry check-post ,oa Exit check-post dk uke M~zkWi Mkmu esU;w ls p;u dj vafdr djuk vfuok;Z gksxk A 5- flLVe }kjk izfrfnu ,sls ifjogudRrkZvksa ds V~zdksa dh lwph fudkyh tk;sxh tks fcgkj jkT; dh lhek esa izos"k djus ds 72 ?kaVs ls vf/kd vof/k rd fudklh check-post ls ugha fudyrs gSa rFkk bl lwph dks v/kksgLrk{kjh ,oa psd&iksLV izHkkjh inkf/kdkjh dks fu;fer :Ik ls miyC/k djk;k tk;sxk A Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 45/49 6- tks ifjogudRrkZ usiky ds fy, eky dk ifjogu dj jgs gSa vFkok usiky ls eky dks Hkkjr ds nwljs jkT;ksa esa ifjofgr dj jgs gSa }kjk dze"k% Exit check-post ,oa Entry check-post jDlkSy vFkok tksxcuh esa vofLFkr dLVe psd&iksLVksa esa ls fdlh ,d dLVe psd&iksLV ij izfo'V djk;k tkuk gksxk A bl fufeRr lacaf/kr dLVe psd&iksLV dks foHkkx ds }kjk user I.D. ,oa password miyC/k djk fn;k x;k gS A 7- ,sls ifjogudRrkZ tks ,d gh okgu esa ,d ls vf/kd consignee dk eky ifjofgr dj jgs gSa] dks ,d gh lqfo/kk flLVe ds }kjk generate fd;k tk;sxk A bl lqfo/kk esa vyx&vyx consignee ds fy, vyx&vyx sub-suvidha number fn, tk;saxs A bu sub-suvidha number dks generate djus ds fy, consignor ,oa consignee ds TIN ds lkFk&lkFk og lHkh lwpuk,Wa flLVe esa upload djuh gksxh tks lqfo/kk generate djus ds fy, vko";d gksrh gSa A ;s sub-suvidha number feydj flLVe }kjk ml okgu esa ifjofgr fd;s tk jgs ekyksa ds crkSj manifest ds :i esa jgsaxs A ** A close perusal of the aforesaid Notifications would disclose that the said Notifications are really the instructions in respect of generation of „Suvidha‟. In other words, they are operational instructions and are not substantive or procedural provisions. In all cases before us, the drivers/person in charge did generate „Suvidha‟ and filed before the authorities at the check- post. The question of effectiveness of the said Notifications, therefore, pales into insignificance. The said Notifications have no bearing upon the impugned actions of seizure of the goods and the vehicles/carriers and imposition of penalty by the respondent authorities.
In the matter of T Narasimhulu & Others [(2010)6 SCC 545] the Hon‟ble Supreme Court has held that, "where the Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 46/49 law prescribes the mode of publication of the law to become operative, the law must be published in that mode only."
In the matter of Harla (AIR 1951 SC 467) the question was that of the offence punishable under the Jaipur Opium Act. The said Act was enacted by the Council of Ministers of the then State of Jaipur in 1923. However, the Act was never published in the Gazette. Fourteen years thereafter on 19th May 1938 it was made effective by publication in the Official Gazette. It was brought in force from 1st September 1924. The question arose was that of the efficacy of that Act. The Hon‟ble Court held that in absence of any law or custom of giving public notice also the Act could not be made effective without publication in the Official Gazette. Publication of a sub-section in the Official Gazette was not publication of the Act itself. The Hon‟ble Court held, "we do not know what laws were operative in Jaipur regarding the coming into force of an enactment in that State. We were not shown any, nor was our attention drawn to any custom which could be said to govern the matter. In the absence of any special law or custom, we are of opinion that it would be against the principles of natural justice to permit the subjects of a State to be punished or penalized by laws of which they had no knowledge and of which they could not even with the exercise of reasonable diligence have acquired any knowledge. Natural justice requires that before a law can become operative it must be promulgated or published. It must be broadcast in some recognizable way so that all men know what it is; or, at the very least, there must be some special rule or regulation or customary channel by or through which such knowledge can be acquired with the exercise of due and reasonable diligence. The thought that a decision Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 47/49 reached in the secret recesses of a chamber to which the public have no access and to which even their accredited representatives have no access and of which they can normally know nothing, can nevertheless affect their lives, liberty and property by the mere passing of a Resolution without anything more is abhorrent to civilized man. It shocks his conscience. In the absence therefore of any law, rule, regulation or custom, we hold that a law cannot come into being in this way. Promulgation or publication of some reasonable sort is essential."
In the matter of Bangalore Woollen, Cotton & Silk Mills Co. (AIR 1962 SC 562) the matter at issue was the levy of octroi under the Bangalore Municipal Corporation Act. Admittedly, the resolution of intention to impose tax (octroi) was published in the local newspapers but not in the Official Gazette. The Hon‟ble Court relied on a saving clause under Section 38 of the Act which provided :
"S. 38(1). No act done, or proceeding taken under this Act shall be questioned merely on the ground -
(a) ........ .............
(b) of any defect or irregularity in such act or proceeding, not affecting the merits of the case."
The Court held that the language of Section 38(1)(b) was clear and unambiguous. It validated any defect in any act or proceeding and made it immune if it did not affect the merits of the case. The resolution in question having been given wide publicity in the newspapers and having been communicated to those who are affected, the Court held that it was well known, the failure to publish it in the Official Gazette did not affect the merit of its imposition. Mere failure to notify the final resolution of the Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 48/49 imposition of the tax in the Official Gazette was not fatal to the legality of the imposition.
In the present case, in absence of similar validating provision, failure to publish the Notification in the Official Gazette will render the Notification ineffective. But as we held the impugned Notifications being operational and having been operated, its validity or otherwise is of no consequence.
In the matter of Rai Vimal Krishna [(2003) 6 SCC 401] the matter at issue was the assessment of property tax under the Patna Municipal Corporation Act, 1951. The Act enjoined the Chief Executive Officer, inter alia, to give public notice, by beat of drum and by placards posted throughout Patna. The Hon‟ble Court held that giving of public notice was mandatory but the requirement of publication by beat of drum and by posting the placards was directory. The Hon‟ble Court was of the view that publication by beat of drum was anachronism and was inappropriate in the present day and age in a large city like Patna.
In the matter of M/s Sree Bahariji Mills Ltd. (AIR 1983 Patna 311) a Bench of this Court was concerned with the notification issued by the State Government. The Bench invoked Section 28 of the Bihar & Orissa General Clauses Act, 1917 to hold that the notification would not become operative until it is published in the Official Gazette.
In the matter of Ram Sagar Prasad [(1985 BRLJ 92(Order)], this Court held that the nomination of a member of the Market Committee would become effective only when the order was notified in the Official Gazette.
The aforesaid principle is reiterated by the Hon‟ble Supreme Court in the matter of Rajendra Agricultural University [(2010) 1 SCC 730].
Patna High Court CWJC No.958 of 2013 (12) dt. 15 -07-2014 49/49In view of the above discussion, the Writ Petitions are dismissed. We reject the challenge to Section 60(4) of the Bihar Value Added Tax Act, 2005 and the Notification dated 4th July 2012 issued in exercise of powers conferred by Sub-Section (1) of Section 93 of the Bihar Value Added Tax Act, 2005 and the Notifications dated 11th July 2012, 12th July 2012 and 30th October 2012 issued by the Commissioner of Commercial Taxes in exercise of powers conferred by Rule 40(2) of the Bihar Value Added Tax Rules, 2005.
We clarify that we have not examined the individual action of seizure and penalty on merits.
(R.M. Doshit, CJ)
Ashwani Kumar Singh, J I agree.
mrl (Ashwani Kumar Singh, J)