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2020 (5) TMI 496 - HC - VAT and Sales TaxDemand of tax and compounding/composition fee - Section 72 of TNVAT Act - detention of goods alongwith vehicle - It is the case of the petitioner that the exercise of power under section 72 of the Tamil Nadu Value Added Tax Act, 2006 for alleged violation of section 71 of the said Act was arbitrary and illegal and without jurisdiction - HELD THAT:- Mere entry of the goods from another state into Tamil Nadu ipso facto does not attract levy under the provisions of the Tamil Nadu Value Added Tax Act, 2006 unless there was a prior sale within the State of Tamil Nadu and no tax was paid or charged - Therefore 1strespondent as the “prescribed authority” under section 67 of the Tamil Nadu Value Added Tax Act, 2006 was competent to detain goods and vehicle and verify the records and documents which accompanied the goods. For the same reasons, the 1st respondent was also competent to demand tax at the check post, if the first respondent was of the view that the detained goods was liable to tax but no tax was paid or charged. 1st respondent as the “prescribed authority” under section 67 of the Tamil Nadu Value Added Tax Act, 2006 was competent to detain goods and vehicle and verify the records and documents which accompanied the goods. For the same reasons, the 1st respondent was also competent to demand tax at the check post, if the first respondent was of the view that the detained goods was liable to tax but no tax was paid or charged. The 1st respondent as an officer in charge of the Check Post is also the “prescribed authority” for the purpose of section 72 of the Tamil Nadu Value Added Tax Act, 2006. Therefore, 1strespondent was competent to issue impugned draft compounding notices dated 24.7.2013 for compounding of the of the offences specified in Section 71 of the Act. There are however several disputed questions of fact on several counts - while upholding the exercise of power by the 1st respondent, the impugned order is set aside in so far as it seeks to demand compounding/composition fee - case remitted back to the 2nd respondent to pass appropriate order on merits in accordance with law. Appeal allowed by way of remand.
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