TMI Blog1994 (7) TMI 311X X X X Extracts X X X X X X X X Extracts X X X X ..... tember 30, 1988 on September 19, 1989 at 11 a.m. at his office in connection with the assessment, i.e., annexure 1, to the writ application. On the same date a notice was issued by the Superintendent of Taxes directing the petitioner to submit a report of turnover under the aforesaid Act and the Central Sales Tax Act, 1956 for the period ending March 31, 1989 and to make payment of taxes on or before September 19, 1989, i.e., annexure III, to the writ application. On September 18, 1989, the petitioner submitted a petition requesting the Superintendent of Taxes to refix the hearing after Puja holiday as it was difficult for the petitioner-firm to produce the books of account on September 19, 1989 due to the reason stated therein. Time was granted by the Superintendent of Taxes. This is annexure 11 to the writ application. On the same date, a reply was submitted to the notice dated September 8, 1989 requesting for grant of 3 (three) weeks time for submission of the return. The prayer was granted by the Superintendent of Taxes, this is annexure IV to the writ application. On September 19, 1989, the Assistant Commissioner of Taxes accompanied by the Superintendent of Taxes and 3 (thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued by the Inspector of Taxes is illegal and not tenable in law. (ii) That the respondent in reality and in effect conducted a search in the business premises of the petitioner-firm without production of search warrant as required by sub-section (1) of section 31 of the Act and, as such, the impugned notice issued under section 31(1) of the Act is in colourable exercise of powers and the same is not tenable in law. (iii) That section 31(3) of the Assam Finance (Sales Tax) Act confers uncontrolled, arbitrary and unreasonable powers on the taxing authority without any limitation in the matter of retention of the seized books of account, papers and documents and, as such, the same violates the right guaranteed under article 19(1)(g) of the Constitution of India and the same is ultra vires, illegal and void. (iv) That the assessment of the petitioner-firm up to the period ending September 30, 1986 having already been completed by the Superintendent of Taxes after due examination of the books of account and documents, the Inspector of Taxes was not justified in directing the petitioner to produce the books of account from April 1, 1985 to September 19, 1989, which results in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... axable goods or matters connected therewith. (2) All accounts, registers and other documents as referred to in subsection (1) the taxable goods in the possession of a dealer and his offices, shops, godowns, buildings, vessels and vehicles shall, at all reasonable times, be open to inspection by the Commissioner. (3) If the Commissioner has reason to suspect that any dealer is attempting to evade payment of any tax under this Act, he may, for reasons to be recorded in writing, seize such accounts, registers or documents of the dealer as may be necessary, and shall grant a receipt for the same and shall retain the same only for so long as may be necessary for the purposes of this Act. (4) The Commissioner may, for the purposes of sub-section (2) or subsection (3), enter and search any place where he has reason to believe that the dealer keeps or is for the time being keeping any accounts, registers, vouchers or other documents referred to in sub-section (1), on the authority of a search warrant issued by a Magistrate. (5) The provisions of section 102 and section 103 of the Code of Criminal Procedure, 1898 (Act V, 1898), shall so far as may be, apply to searches under sub-s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a long list of the documents seized from the petitioner-company. The power under section 31(1) is not arbitrary and uncanalised. Before issuing a notice the officer must apply his mind to the facts of the case and must give due regards to the necessity of not disturbing the business of the dealer or work of his staff any more than is necessary for the purpose of ascertaining the required information. This section does not contemplate issuance of a notice of general nature requiring a dealer to produce the books of account from any date which the officer concerned desires. In the instant case, the assessment of the petitioner up to September 30, 1986, had already been completed and the Inspector cannot exercise the power under section 31(1) as it would amount to reopening of the completed assessment which is not permissible without fulfilment of the requirements of section 11 of the Act. Section 31(1) cannot override and cannot overstep the mandatory provision of section 11 of the Act. Such omnibus notice is not contemplated under the law and it may amount to fishing and roving enquiries in the business affairs of the petitioner-company which is not permissible under the law. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibed in the proviso to section 28(2) of the Act did not apply: Held, that, assuming that the respondent was the competent officer to make the inspection including search and there was a distinction between inspection and search, as the allegations made by the petitioner remained uncontroverted by the respondent, the action of the respondent was a search and seizure and was therefore illegal." The section 28(1) and (2) of the Karnataka Sales Tax Act is in pari materia with the Assam Act. (ii) [1971] 27 STC 434 (Harikisandas Gulabdas Sons v. State of Mysore) where the Mysore High Court pointed out as follows: "The provisions contained in the Code of Criminal Procedure, 1898, relating to searches and seizures would be applicable mutatis mutandis to searches and seizures made under section 28(2) of the Mysore Sales Tax Act, 1957. It is highly unbecoming of the officers of the department to conduct illegal search, and seize documents or accounts and make it appear that they are voluntarily handed over to them. The parties against whom search is to be conducted are entitled to the protection given under the provisions contained in Chapter VII and in particular of those in sec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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