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2014 (7) TMI 786 - HC - VAT and Sales TaxDetention of goods - respondent No. 4 appeared before the first respondent and requested to release the goods bringing to his notice that the petitioner is a registered dealer and that the transactions in question are duly recorded in the books of accounts and the goods were being carried accompanied by all necessary documents - first respondent insisted upon payment of tax at five per cent. of the value of goods together with two times penalty alleging that the consignments were not covered by proper documents. As the goods are subject to natural decay, the petitioner was constrained to pay the tax and penalty as demanded and got the goods released - Assessee seek a declaration that the action of respondents 1 to 3 in collecting the tax and penalty is arbitrary, illegal and without jurisdiction - whether the assessing authorities and the officers of the vigilance wing at the time of inspection of the vehicles have power to resort to spot collection of the tax and compounding fee without passing any order as to the tax liability. Held that:- it is not open to respondents 1 and 3 to arrive at a conclusion as to the petitioner's tax liability immediately after interception of the vehicles in question. The contention of respondents that the writ petitioner is a stranger to the transaction is untenable since the petitioner is the registered dealer and the burden is on the petitioner to prove that the transaction in question is not an inter-State sale and that the transaction is not liable to be taxed in terms of section 6A of the Central Sales Tax Act. Such liability can be determined only after complying the procedure prescribed under the Act and till such determination is made collection of tax and penalty is undisputedly without authority of law. Merely because respondent No. 4 paid the tax, it is not open to respondents Nos. 1 to 3 to contend that the petitioner is a stranger to the transaction, particularly in view of the admitted fact that respondent No. 4 is none other than the consignee. - The further contention advanced on behalf of the respondents that the tax and penalty was paid voluntarily by respondent No. 4 does not appear to be credible and is not at all convincing in the facts and circumstances noticed above and therefore we are unable to accept the said plea - respondents 1 to 3 and 5 are directed to refund to the petitioner the amounts collected while releasing the vehicles in question, together with interest at six per cent per annum within eight (8) weeks - Decided in favour of assessee.
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