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2017 (6) TMI 432 - HC - VAT and Sales TaxLegality of assessment order - release of seized goods on deposit of security - Revisionist is not a dealer registered under U.P. Value Added Tax Act, 2008 - A show cause notice was issued on 24.11.2016, fixing 29.11.2016 as the date. Notice also indicated that physical verification of goods is required. The notice was allegedly pasted on the vehicle. None appeared on 29.11.2016. Applicant denies receiving of this notice - case of appellant is that since a valid TDF form was shown alongwith relevant documents, required to be possessed with the transport vehicle, the ex-parte proceedings of seizure and direction to deposit 40% of value of such goods towards security is wholly unjustified. Held that: - State legislature enacted Uttar Pradesh Value Added Tax Act, 2008, introducing value added system of taxation to levy tax on sale and purchase of goods in the State of U.P. Liability to pay tax under the Act arise only upon sale or purchase of goods within the State. No tax is leviable when goods enter the State from any place outside the State and is bound to any other place outside the State of U.P. - The transport vehicle crossing the State has to possess a transit declaration form as well as other documents required to be possessed as per the circular issued by the Commissioner in terms of Section 50 of the Act. The authorities are entitled to verify whether such declaration/documents are available with the vehicle and disclosure made is true, and if it be so, no further scrutiny is warranted. The authorities would be entitled to verify correctness of declarations/documents. For such purposes, the authorities can verify as to whether the goods actually transported are as disclosed in the TDF, and physical verification can be made to ascertain that declaration made is true. The object of enquiry is merely to satisfy that goods declared to be transported are coming from outside the State, and is actually bound to a place beyond the State. If for part of the goods no reference is made in TDF or relevant supporting documents are missing, a rebuttable presumption might arise that such goods are not intended to cross the State, and are likely to be offloaded within the State. After considering the relevant circulars, this Court while answering question no.2 rejected the contention that Delhi-U.P. Border Area of District Ghaziabad is a 'no man's land' - seizure of goods were held valid. The details of consignor and consignee need not be investigated, at the first instance, if the description of goods mentioned in TDF as well as other details are found correct, nor the authorities would not be justified in detaining or seizing goods merely for the reason that consignor and consignee details are allegedly incorrect. However, where declaration/documents supporting transport of goods are found bogus/fraudulant etc., the authorities may examine details of consignor and consignee with an intent to ascertain whether goods are intended to pass through State or not. - Coming to the facts of the present case, it is to be found that the description of goods mentioned in TDF was found to be at variance with the goods actually transported. Under the circular, authorities have jurisdiction to make physical verification. The authorities have detained only such goods, which are found to be in excess of what was disclosed in the TDF. The valuation of goods transported was also found wrong. To that extent, goods transported are found to be at variance with the declaration made in TDF and the authorities would clearly be justified in detaining goods so as to proceed lawfully against it. Although, it is settled that service of notice has to be in accordance with the Rules of 1972, but on facts, it is found that notices were served upon transporter by the registered post as well. In view of the finding that letters have been sent by registered post on 30th November, 2016, and 10th December, 2016, the argument that proceedings drawn were violative of principles of natural justice cannot be sustained. The order of seizure of goods, therefore, in so far as it is not backed by disclosure made in TDF is upheld. In the facts and circumstances of the present case, it would be appropriate to modify the order of Tribunal, dated 3.3.2017, and to permit release of goods upon depositing 15% of the value of goods, and furnishing of indemnity bond for the balance 85% amount - revision allowed.
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