TMI Blog1995 (11) TMI 395X X X X Extracts X X X X X X X X Extracts X X X X ..... affidavit in support of the present writ petition, its director, Mr. Khailashchand Agarwal, states that in the recent past the authorities in the first respondent's office collected sales tax from the petitioner on incoming consignment of oils, though there were no irregularities in the transport documents, on the ground that there was shortfall of revenue in the Nalgonda Division and that these taxes were collected under threat of detention of vehicles by merely issuing cash receipts, even though no irregularities were there, and no proceedings were issued in support of the collection. It is further stated that to avoid undue expenditure on detention of vehicles, the petitioner had paid the tax to the first respondent on earlier occasions and it was being assured that this practice would end shortly. The immediate action for filing the present writ petition is that on November 8, 1995, the first respondent issued notice demanding "tax" of Rs. 6,150 on the consignment of sunflower oil being transported to the petitioner from Raichur in lorry No. KA. 36-1880. In the said notice it is mentioned that the first respondent was instructed to collect tax on oil and oil-seeds by the Deput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment. The learned Government Pleader is unable to explain what tax was due from the petitioner to be paid in respect of the consignment of sunflower oil in question at the inspection and detention point. No tax could be collected merely on the goods that were being transported under proper papers. In paragraph 3 of the counteraffidavit, filed by the first respondent, it is stated as follows: "The Deputy Commissioner (C.T.), Nalgonda during her camp at Mahaboobnagar visited the observation point on October 26, 1995 and after perusal of the registers maintained at the observation point has asked to collect the sales tax on the edible oils coming into the State from other States to safeguard the revenue, which is being complied with." As regards the "tax" that is sought to be collected, it is further explained as follows: "In this case, there is no detention of the vehicles carrying the goods, and the sales tax collected on such consignment is nothing but an advance collection and cash receipt issued contains all the details about the consignment. The intention of such collection of tax is that the consignment is sure to be accounted for by the dealer. Further, if the consignme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ular dealer. Instructions are to collect sales tax on all such consignments. In this particular case the driver of lorry No. KA.36/1880 has been asked to pay sales tax on the sunflower oil being consigned from Raichur to Hyderabad." (Emphasis* supplied). He has not stated how sales tax is leviable on such consignments. He however describes the impugned notice as "nothing but an appeal asking to pay tax of Rs. 6,150". The impugned notice itself reads as follows: "Please take notice that during the course of check of the vehicular traffic at observation point Bandameedipally, Mahbubnagar on November 7, 1995, at 11.50 P.M. a vehicle bearing No. KA.36/1880 is found carrying sunflower oil from Raichur to Hyderabad. The consignee of the oil is M/s. Goodhealth Agro Tech. Ltd., Hyderabad and consignor M/s. Jagadish Industries, Raichur. There was lot of evasion in oil trade. The Deputy Commissioner (C.T.), Nalgonda Division, Nalgonda, during the visit at Mahbubnagar on October 26, 1995, has instructed to collect sales tax on oils and oil-seeds to safeguard the revenue legitimately due to the Government. Hence you are requested to pay tax of Rs. 6,150 at 2 per cent on the value of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... city limits would not attract the levy of octroi unless goods were brought in for use or consumption or sale, and that on the facts of that case octroi was wrongly collected. The Supreme Court further held as follows in that context: "........Realisation of tax or money without the authority of law is bad under article 265 of the Constitution. Octroi cannot be levied or collected in respect of goods which are not used or consumed or sold within the municipal limits. So these amounts become collection without the authority of law. The respondent is a statutory authority in the present case. It has no right to retain the amount....." The law as to when and how sales tax could be collected is clearly stated by the Supreme Court in Khazan Chand v. State of Jammu and Kashmir [1984] 56 STC 214; AIR 1984 SC 762 as follows, dealing with the provisions in the Jammu and Kashmir General Sales Tax Act, 1962: ".......Collection of tax by the State may be either after the liability is quantified by assessment or may be prior to actual assessment by requiring the assessee to pay before any assessment is made the amount of tax admitted to be due and payable by him. This is done by making pr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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