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2009 (2) TMI 764 - KERALA HIGH COURTWhether section 47(16A) under which circular Nos. 50 and 53 of 2006 are issued, does not authorise collection of advance tax before sale? Whether section 47(16A) authorises declaration of evasion-prone goods and collection of tax in advance, i.e., prior to sale of goods, then such provision is unconstitutional? Held that:- What is contemplated in the section is collection of tax for the commodities covered by the notification which are declared evasion-prone, at the earliest opportunity possible, which is on arrival of goods in the State itself, thereby making evasion of tax for the goods impossible. Therefore, we reject the contention of the appellants that section 47(16A) does not authorise collection of tax before sale. Consequently we hold that the impugned circulars authorising collection of tax in advance prior to sale of the commodities referred to therein are in accordance with the statutory provisions. We are not impressed with the argument of the appellants that their rights under article 19(1)(g) are violated inasmuch as before the incidence of tax falls, they are made to pay the tax because for sale of commodity from the beginning to the end of a month, the dealers are allowed to keep the tax until the 10th of the succeeding month when they are required to remit the monthly tax. Since the statute authorises dealers to retain collected tax for up to 40 days, we see no reason why dealers cannot be called upon to pay tax in advance for the commodity brought for sale in the State. Further, the system of payment of advance tax is working very smoothly for the last three years which only shows that the traders have accepted the same. Appeal dismissed
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