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2015 (11) TMI 939 - GUJARAT HIGH COURT

2015 (11) TMI 939 - GUJARAT HIGH COURT - [2016] 88 VST 171 (Guj) - Detension of truck and seizure of goods - transporter was not carrying any transit pass issued by the entry check-post - the officer at the check-post informed the carrier that since there was no exit check-post in Diu, it would not be possible for him to issue transit pass even on the basis of the manual application - Thus, though the transporter had given application for transit pass in Form 404, no transit pass was issued to t .....

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hat it is the officer in-charge of a check-post who is empowered to take action under sub-sections (4) and (5) of section 68 of the VAT Act. Sub-section (1) of section 68 of the VAT Act provides that if the State Government considers that with a view to preventing evasion of tax in any place or places in the State, it is necessary to do so; it may by notification in the Official Gazette, direct that such number of check-posts shall be set up or such number of barriers shall be erected at such pl .....

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espondents. - Even if such letter had granted such permission, the same would be without jurisdiction, inasmuch as, the jurisdiction under section 68(1) of the VAT Act has to be exercised in the manner provided therein by the State Government by issuing a notification specifying the places where such check-post is to be set up or barrier is to be erected. Under the circumstances, the second respondent had no jurisdiction to take any action in exercise of powers under section 68(4) or (5) of .....

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ssee. - SPECIAL CIVIL APPLICATION NO. 18476 of 2015 - Dated:- 5-11-2015 - MS. HARSHA DEVANI AND MR. A.G.URAIZEE, JJ. FOR THE PETITIONER : UCHIT N SHETH, ADVOCATE FOR THE RESPONDENT : MS MAITHILI MEHTA, ASSTT. GOVT. PLEADER ORAL ORDER (PER : HONOURABLE MS.JUSTICE HARSHA DEVANI) 1. This petition under Article 226 of the Constitution of India is directed against the seizure memo dated 24.10.2015 issued by the Commercial Tax Officer as well as the show cause notice dated 24.10.2015 issued by the sai .....

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titioner in Diu. For the purpose of reaching Diu from Mangalore, the goods were to pass through the State of Gujarat. It is the case of the petitioner that section 69 of the Gujarat Value Added Tax Act, 2003 (hereinafter referred to as the VAT Act ) requires the transporter to get a transit pass issued at the entry check-post if the goods are to pass through the State of Gujarat for onward journey outside the State. For the purpose of issuance of transit pass, the transporter is required to subm .....

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hence, it gave a manual application in the prescribed Form 404 to the driver of the vehicle for issuance of transit pass. It was specifically mentioned in the application that since the online system was not showing exit check-post for Diu, he could not generate online Form 404/405 and hence, he had given manual application in Form 404/405. 4. It is further the case of the petitioner that when the goods reached the entry check-post at Songadh in the State of Gujarat, the transporter showed the d .....

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sis of the manual application. Thus, though the transporter had given application for transit pass in Form 404, no transit pass was issued to the transporter, and the truck with the goods, was allowed to enter into the State of Gujarat. However, when the truck carrying the goods was approaching Karjan in Vadodara district, it was stopped by the second respondent of the Enforcement Division of the Commercial Tax Department. It is the case of the petitioner that the truck was simply detained on th .....

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r, detained the truck and seized the goods by the impugned memo on the ground that the transporter was not carrying any transit pass issued by the entry check-post. The second respondent further issued the impugned show cause notice to the petitioner calling upon it to show cause as to why tax, interest and penalty should not be imposed under section 68 of the VAT Act. The petitioner initially made representation before the second respondent, however, since the truck and the goods were not relea .....

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ined at a place where there was no check-post or barrier as contemplated under section 68(1) of the VAT Act. Reference was made to the provisions of section 68(4) thereof to point out that it is an officer in-charge of the check-post or barrier who is empowered to take action under the said provision. It was submitted that in the facts of the present case, the officer who has issued the memo under section 68(4) as well as the show cause notice under section 68(5) of the VAT Act had no authority .....

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respondents placed reliance upon the contents of the affidavit-in-reply filed on behalf of the respondents. As regards the powers of the second respondent to detain the vehicle in question together with the goods, it was submitted that the Additional Commissioner Enforcement, Ahmedabad, Gujarat State has, by a letter dated 06.07.2015, directed the Deputy Commissioner of Commercial Tax to have mobile check-posts in the areas near Karjan Toll Naka, Dhumad Chokadi, Express Highway, Godhra - Limdi r .....

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ther submitted that under the provisions of section 67(6)(b) of the Act, if the Commissioner has reason to believe that the tax on goods given to a carrier who is delivering such goods in any vehicle or vessel, is likely to be evaded, then the Commissioner may stop the vehicle or vessel carrying such goods and enter and search the vehicle and inspect the goods and records relating to the same and elicit such information from the carrier as is relevant. It was, accordingly, urged that the truck w .....

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cause notice issued by the second respondent reveals that the seizure memo has been issued in exercise of powers under section 68(4) of the VAT Act and the show cause notice has been issued in exercise of powers under section 68(5) thereof. Sub-sections (4) and (5) of section 68 of the VAT Act, which are relevant for the present purpose, read as under : 68. Inspection of goods in transit, etc.: (4) (a) If the officer-in-charge of the check-post or barrier is of the opinion that - (i) goods unde .....

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e driver or other person in charge of a vehicle, boat or animal carrying goods does not make a declaration or if he makes a declaration, he does not keep a copy thereof with him as required by clause (c) of sub-section (3), he may, after recording the reasons, seize such goods and vehicle and give receipt thereof to the person from whose possession or control, the goods or vehicles are seized. (5) (a) The officer-in-charge of the check-post or barrier may, after giving the owner, driver or perso .....

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rm as may be prescribed. 9. Thus, on a plain reading of the above provision, it is evident that it is the officer in-charge of a check-post who is empowered to take action under sub-sections (4) and (5) of section 68 of the VAT Act. Sub-section (1) of section 68 of the VAT Act provides that if the State Government considers that with a view to preventing evasion of tax in any place or places in the State, it is necessary to do so; it may by notification in the Official Gazette, direct that such .....

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r Enforcement, Gujarat State by virtue of a letter, as has been submitted on behalf of the respondents. Moreover, a perusal of the letter dated 06.07.2015 issued by the Additional Commercial Tax Commissioner reveals that by virtue of the said letter, he has granted permission to the Deputy Commercial Tax Commissioner to carry out surprise mobile checking in relation to sensitive/prohibited goods in the areas mentioned therein. The said letter nowhere grants permission to the concerned officers t .....

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