AI Structured Summary
Not yet generated for this judgment
Judgment
V. Dhanapalan, J.—Heard Mr. D. Veerasekaran, learned counsel for the petitioner and Mr. Manoharan Sundaram, learned Government
Advocate appearing for the respondent. The petitioner-Company challenges two proceedings of the respondent, one relating to Goods Detention
Notice No. 100/2012-2013, dated 1.2.2013 and the other is the consequential notice in GDN. No. 100/2012-2013, dated 1.2.2013, in respect
of the offence stated to have been committed by the petitioner under Sections 70(1)(c), 71(3)(d), 71(3)(e) and 71(5)(a) of the Tamil Nadu Value
Added Tax Act (for short, ''the TNVAT Act''), calling upon the petitioner to pay the compounding fee for release of the goods vehicle detained at
Kandamangalam Check Post @ Lingareddi Palayam, Villupuram District, failing which, it was observed therein that appropriate action will be
initiated as per the Rules in force, seeking to quash both the said proceedings as illegal, arbitrary and against the procedure contemplated in law.
The case of the petitioner is briefly stated as follows:
(a) The petitioner-Company is engaged in the business in IMFL at Pondicherry and an assessee on the file of the Deputy Commissioner of Excise,
Government of Puducherry and is a licensed importer having Licence Import Permit No. 001704/7402/DCE/2012-13. The petitioner is a
registered dealer under the Pondicherry Value Added Tax Act and having a Registration in ST TIN No. 34540000942 and CST Registration No.
CST 11050/PRC, dated 1.4.1997.
(b) The petitioner purchased Macdowel Genuine Grape Brandy for a sum of Rs. 9,69,151/- from United Spirits Limited, Chertala, Varanadu
Post, Alapula District, Kerala and the consignment was accompanied by Invoice No. 90038074, dated 29.1.2013 and the transit permit issued by
the Deputy Commissioner of Excise, Puducherry and the goods were consigned through lorry bearing Registration No. TN-31-H-6581 with
Vehicle Permit No. NP/TN/31/032012/76698. The invoice and the Consignment Declaration Form No. 8 F contain all particulars required u/s 67
of the TNVAT Act.
(c) As the goods were crossing the State of Tamil Nadu from Kerala to Pondicherry, there was no jurisdiction for the respondent to demand tax
and compounding fee, as the present sale is a sale outside the State of Tamil Nadu and merely because the vehicle crosses Tamil Nadu, the
respondent cannot usurp their jurisdiction. The respondent misconstrued in invoking Section 70(1)(a) of the TNVAT Act and detained the goods
without considering the documents accompanied with the vehicle, namely (i) invoice, which consists of the Registration Number of the vendor and
the purchaser and also the proof of Central Sales Tax, (ii) excise permit for import of intoxicants issued by the Deputy Commissioner of
Puducherry, (iii) ''E'' Consignment Declaration Form No. 8-F, (iv) Carrier''s Insurance copy (goods consignment note) and (v) Certificate issued
by the DCTO Check Post Officer, K.G. Chavadi (incoming), Coimbatore.
(d) It is for the Check Post Officer, Coimbatore to issue a transit pass, however, he issued only a certificate which satisfies the genuineness of
goods from Kerala to Pondicherry. As there was no sale or purchase taken place within Tamil Nadu, the levy of tax is illegal, arbitrary and against
law. Once the certificate is produced, the petitioner satisfied Section 70(1)(a) of the TNVAT Act and as the goods did not move from State of
Tamil Nadu to any other State, there is no violation of Section 70 of the TNVAT Act. The transporter gave a detailed explanation to the
respondent, which was not considered by them. Since the consignment was covered by all the abovesaid documents, it is not for the respondent to
arbitrarily detain the goods. The petitioner is not a registered dealer in the State of Tamil Nadu and there is no sale or purchase in the State of
Tamil Nadu, and hence, for want of jurisdiction, the impugned detention notice and demand of compounding fee are liable to be quashed.
The respondent has filed counter affidavit, inter-alia stating as follows:
(a) The petitioner is carrying on business in IMFL at Pondicherry and an assessee on the file of the Deputy Commissioner of Excise, Government
of Puducherry and is a registered dealer under the Pondicherry Value Added Tax Act and also having CST registration number. The petitioner
purchased Macdowel Genuine Grape Brandy for a sum of Rs. 9,69,151/- under the invoice dated 29.1.2013 from United Spirits Limited,
Chertala, Varanadu Post, Alapula District, Kerala and the consignment was accompanied by the invoice and transit pass issued by the Deputy
Commissioner of Excise, Puducherry in a lorry with vehicle permit.
(b) As per Clause (a) of Sub-section (1) of Section 70 of the TNVAT Act, the owner or other person in-charge of such goods vehicle, shall
obtain transit pass in Form LL and in the prescribed manner from the Officer-in-charge of the first Check Post, after its entry into the State and
according to Clause (b) of sub-section (1) of Section 70, the owner or other person in-charge of the goods vehicle, shall deliver within the
prescribed period, the transit pass to the Officer-in-charge of the last Check Post, before the exit of the goods vehicle from the State. As per
Clause (c) of sub-section (1) of Section 70, if such person fails to comply with Clause (b), it shall be deemed that the goods carried thereby have
been sold within the State by such person, and he shall be liable to pay tax in accordance with the provisions of the TNVAT Act, irrespective of
the turnover and also penalty which shall be 150% of such tax.
(c) In this case, the person in-charge of the goods vehicle failed to get transit pass in Form LL from the entry Check Post at Kanthe Gowndan
Chavadi (KG Chavadi) and it reached the Kandamangalam Check Post at Lingareddi Palayam and as no transit pass was obtained, the goods
vehicle was detained and the goods carried in the vehicle were deemed to have been sold within the State, as per Section 70(1)(c) of the TNVAT
Act, as per which, it is not necessary that the petitioner should have been a registered dealer in the State of Tamil Nadu. It is not correct to say that
there is no sale in the State of Tamil Nadu. There is no arbitrary detention of the goods with vehicle and the action of the respondent is within the
jurisdiction. The goods along with the vehicle were released as per the interim direction of this Court, dated 11.2.2013 on payment of tax at 58%
at Rs. 6,31,078/-.
(d) The petitioner is having alternative remedy of revision u/s 54 of the TNVAT Act and the respondent prayed for dismissal of the Writ Petition.
On the above background of pleadings, I have heard the learned counsel appearing for the parties and perused the material documents available
on record.
Learned counsel for the petitioner contended that even though the goods vehicle in question was accompanied by various documents like
invoice, excise permit for import of intoxicants issued by the Deputy Commissioner of Puducherry, ''E'' Consignment Declaration Form No. 8-F,
Carrier''s Insurance copy (goods consignment note) and the Certificate issued by the DCTO Check Post Officer, K.G. Chavadi (incoming),
Coimbatore, the respondent invoked the provisions of Section 70(1)(c) and detained the goods with the vehicle in question and demanded
payment of compounding fee by issuing the impugned goods detention notice, which is without jurisdiction. He made a consistent plea that the
petitioner is prepared to file their objections to the impugned goods detention notice and prayed that the respondent may be directed to consider
the same and only thereafter, the liability of the petitioner to pay the amount may be decided and the petitioner may proceed thereafter in the
matter.
On the other hand, the learned Government Advocate appearing for the respondent contended that there is non-compliance of the provisions of
Section 70(1)(a) and (b) of the TNVAT Act, and therefore, the impugned goods detention notice is issued for the offence committed u/s 70(1)(c).
In this regard, it is worthwhile to notice Section 70(1)(a), (b) and (c) of the TNVAT Act, dealing with issuance of transit pass, which reads as
follows:
Section 70: Issue of transit pass: (1) (a) When a goods vehicle carrying any goods mentioned in the Sixth Schedule, coming from any place outside
the State and bound for any other place outside the State, passes through the State, the owner or other person in-charge of such goods vehicle
shall obtain a transit pass in the prescribed form and in the prescribed manner from the officer in-charge of the first check post or barrier, after its
entry into the State.
(b) The owner or other person in-charge of the goods vehicle shall deliver within the prescribed period, the transit pass to the officer in-charge of
the last check post or barrier, before the exit of the goods vehicle from the State.
(c) If the owner or other person in-charge of the goods vehicle fails to comply with clause (b), it shall be deemed that the goods carried thereby
have been sold within the State by the owner or person in-charge of the goods vehicle, and such owner or person in-charge of the goods vehicle
shall, notwithstanding anything contained in Section 3, be jointly and severally liable to pay tax in accordance with the provisions of this Act,
irrespective of the quantum of turnover and also penalty which shall be one hundred and fifty per cent of such tax:
Provided that where the goods carried by such goods vehicle are, after their entry into the State, transported outside the State by any other vehicle
or conveyance, the onus of proving that the goods have actually moved out of the State, shall be on the owner or person in-charge of the goods
vehicle who originally brought the goods into the State.
Thus, it is clear that as per Clause (a) to sub-section (1) of Section 70 of the TNVAT Act, when a goods vehicle carrying any goods mentioned
in the Sixth Schedule, coming from any place outside the State and bound for any other place outside the State, passes through the State, the
owner or other person in-charge of such goods vehicle shall obtain a transit pass in the prescribed form and in the prescribed manner from the
officer in-charge of the first check post or barrier, after its entry into the State. It is stated in the impugned goods detention notice that the seller,
consignor or transferor, in all, failed to comply with the provisions of the TNVAT Act for transport of 6th Schedule goods and hence, the
compounding fee was ordered to be paid as per Section 70(1)(c) of the TNVAT Act, for having committed an offence under Sections 70(1)(c),
71(3)(d), 71(3)(e) and 71(5)(a) of the TNVAT Act, and the petitioner-dealer was given an opportunity to compound the offence u/s 72(1)(a) of
the TNVAT Act by payment of the amount of compounding fee as per Section 70(1)(c) and accordingly, the respondent issued the impugned
goods detention notice demanding payment of compounding fee. As the learned counsel for the petitioner now pleaded before this Court that the
petitioner has valid objections to be filed as against the impugned goods detention notice and notice demanding compounding fee, this Writ Petition
is disposed of, with a direction to the petitioner to file their objections to the impugned notices, dated 1.2.2013 respectively, within a period of two
weeks from the date of receipt of a copy of this order, and on filing such objections, the respondent shall consider the same, afford an opportunity
of hearing to the petitioner and pass appropriate orders, on merits and in accordance with law, within a period of four weeks from the date of
receipt of such objections. It is always open for the petitioner to act further in accordance with law, in case any adverse decision is taken against
them. No costs. The Miscellaneous Petition is closed.