PETITIONER:
CALCUTTA IRON MERCHANTS ASSOCIATION AND ANOTHER
Vs.
RESPONDENT:
COMMISSIONER OF COMMERCIAL TAXES AND ANOTHER
DATE OF JUDGMENT: 23/02/1996
BENCH:
JEEVAN REDDY, B.P. (J)
PARIPOORNAN, K.S.(J)
CITATION:
JT 1996 (5) 563 1996 SCALE (2)726
ACT
HEADNOTE
JUDGMENT
ORDER
Leave granted.
Heard counsel for the parties.
Section 4B of the Bengal Finance (Sales lax) Act, 1941 says:
"No person shall transport from any
railway stations steamer station,
airport, post office, or any other
place whether of similar nature or
otherwise, notified in this behalf
by the State Government, any
consignment of any notified goods
exceeding such quantities and
except in accordance with such
conditions as may be prescribed.
Such conditions shall be made with
a view to ensuring that there is no
evasion of tax by this Act." Sub-section (2) empowers the State Government to prescribe the conditions for regulating transport of notified goods from any places other than those referred to in sub-section (1) with a view to ensuring that there is no evasion of tax imposed by this Act.
Pursuant to the above provisions, rules have been made by the State Government. Rule 89A and in particular sub-rule (2) thereof is relevant for our purpose It reads:
"(2) Where such contingent is
despatched from any place within
West Bengal and the value whereof
exceeds rupees twenty five
thousand--
(a) any person transporting such
consignment shall carry with him a
consignment note or delivery notes
sale bill or cash memo or similar
document and a written declaration
in duplicate duly signed by the
consignor or his authorized agent
in the form mentioned in the
Schedule appended to this sub-rule
in respect of such consignments and
shall, on demand by the officer
referred to in the proviso to sub-
rule (1) of Rule 70A, produce the
said documents and declaration and
the said officers on being
satisfied about the correctness of
the documents and the declaration,
shall only allow the movement of
such quantity of notified goods
mentioned in that declaration and
conforming to the description give
therein and to other documents
produced He shall retain one copy
of the declaration and return the
second copy on which he shall
endorse the date on which the
consignment is transported and
shall sign, seal and date such
endorsement;
(b) If the declaration referred to
in clause (a) in respect of any
consignment has already been
submitted to an officer referred to
in the proviso sub-rule (1) of rule
70A any person transporting such
consignment shall, on demand by
such officer at any subsequent
place, produce the countersigned
and sealed copy of the aforesaid
declaration.
SCHEDULE
- - - - - - - -
Declaration
-----------
Declaration Na.......
Date.................
I/We declare that the
following consignment of notified
goods is despatched from a place
within West Bengal:-
1. Name and address of the
consignor
2. (a) Name and address of the
consignee.
(b) Registration Certificate
No. of the consignee (if
registered or certified
under any of the Sales
Tax Acts).
3. Place of despatch.
4. Destination.
5. Description of consignment
6. Quantity
7. Weight
8. Value
9. Consignor’s Bill/Cash Memo/other
document (specify) No. and
date
10. Consignment or Delivery Note
No. and date.
I/We declare that I/We hold/do
not hold Registration
Certificate/Certificate No........
under the Bengal Finance (Sales
Tax) Act, 1941/West Bengal Sales
TAX. Act, 1954.
I/We have/have not
manufactured the goods in West
Bengal/not transported the goods
from outside West Bengal.
The above statements are true
to the best of my/our Knowledge and
belief.
status of the declarant
Signature
N.B. (1) This declaration should
bear a consecutive issue
number of the office of
the consignor giving the
declaration and a true
copy of the same should
be retained by him.
(2) Strike out words or phrase
not applicable.
[Inserted by Notification No.1863
F.T dated 25.4.1985 w.e.f.
1.5.1985]"
According to clause (a) of sub-rule (2), a person transporting goods shall carry with him three sets of documents, viz.,(i) consignment note or delivery note (ii) sale bill or cash memo or similar document and (iii) a written declaration in duplicate duly signed by the consignor or his authorized agent in the form mentioned in the Schedule to the sub-rule in respect of such consignment. These documents are required to be produced by such transporter on demand by any appropriate officer. The declaration form contained in the sub-rule says that the declaration has to be signed by the consignor or his authorized agent and shall contain the specified particulars. It is this declaration which along with other prescribed documents, a person transporting such goods has to produce as and when demanded by the appropriate officer.
We are concerned herein with persons who are dealers in iron and steel. Their case is this: Iron and steel is taxable at the first point of sale. Iron and steel is manufactured by major manufacturing units. When they sell the same, they pay tax thereon. The appellants are only purchasers and they transport goods purchased by them in the course of their business. They complain that under the rules, an obligation is placed only upon the purchasers/transporters to be in possession of the aforementioned three sets of documents and to produce them whenever demanded by the appropriate officer but no such obligation is placed upon the sellers/consignors. Consequently, the sellers are not issuing the declarations as contemplated by Rule 89A(2). The appellants ares therefore, not in a position to produce the declaration when demanded by the authorities, on which account they are being to harassment and financial loss.
Sri A.Subba Rao, learned counsel for the appellants, reiterates the grievance that the rule which does not place an obligation upon the soller/consignor of the goods to issue the aforesaid written declaration in the prescribed form but places an obligation upon the consignee/purchaser to carry it, is unreasonable and oppressive. We do not think this grievance is well-founded. The Rule squarely places an obligation upon the consignor to issue a written declaration in duplicate in the prescribed forms signed by him or by his authorized agent. The rule places a statutory obligation upon the consignor/vendor to issue and the consignee/purchasers to carry the declaration Form. All this is meant to check and prevent evasion of Sale Tax and no dealer can make any legitimate grievance against it.
We, therefore, dispose of this appeal with the above directions/clarifications.
We may also clarify that the direction made by the Tribunal in Paragraph 16 of its judgment to the effect "We, however, like to direct that where a transporter or consignee fails to produce a written declaration as required by rule 89A(2), he should be allowed to establish that he had demanded such a declaration from the selling dealer or the consignor, but the latter did not issue or refused to issue the same. If the appropriate authority is satisfied that the transporter or consignee had, in fact, not negligent in the matter, and the consignor or selling dealer had not issued or refused to issue the declaration, inspite of request for the same, there should be neither any seizure of Iron and Steel declared goods nor imposition of penalty on the sole ground that the declaration has not been produced in terms of rule 89A(2)" - is not only impractical but is also likely to lead to several complications. In any event, in the light of the clarification made by us with respect to the meaning and purport of rule 89A(2), the above direction becomes unnecessary and is accordingly deleted.
The appeal is disposed of accordingly. No costs.