Sri N.C. Gupta, Advocate, has filed his Vakalatnama on behalf of the opposite party. The same may be placed on record.
This is a revision filed by the Commissioner of Trade Tax against the order of the Commercial Tax Tribunal, Kanpur dated 22.1.2011 arising from the seizure proceeding. The Tribunal by the impugned order directed release of the goods without any security.
The opposite party is a registered dealer and has purchased wooden beadings from M/s. A.K. Lambers Limited 92/4 W.H.S. Block-2, Kirti Nagar New Delhi against invoice no.16/790 dated 29.12.2010 for Rs.1,54,093/-. In the invoice, the quantity mentioned was 16.2618 cubic meters. The vehicle no. UP83P/9590 in which the goods were loaded was intercepted by the Joint Commissioner (SIB) Commercial Tax, Mathura. The driver of the vehicle produced the copies of the invoice and a declaration Form 38 no.BB-1659387. A show cause notice has been issued on the ground that the beadings are never being sold in cubic meters and always sold in running feet. Even the volume in cubic meter was also shown less than the goods available in the vehicle. The authority concerned has taken the quotation from various parties and has determined the value at Rs.13,06,453/-. The dealer filed reply to the show cause notice stating therein that the purchases were made on cubic meters and the goods were supported by invoice and declaration form. Vide order dated 9.1.2011, the goods were seized and a cash security to the extent of 40% of the value of the goods at Rs.4,60,944/- has been demanded. The opposite party filed an application before the Joint Commissioner (SIB) Commercial Tax, Mathura, which has been allowed in part and vide order dated 13.1.2011 he has directed release of the goods on furnishing of 30% of security in cash and 10% in the form of bank guarantee.
Being aggrieved by the order, the opposite party filed an appeal before the Tribunal. The Tribunal by the impugned order directed release of the goods without any security. The Tribunal held that under Section 50 of the U.P. Value Added Tax Act (hereinafter referred to as "VAT Act") the goods cannot be seized on the ground of under valuation. The Tribunal further held that the goods were covered by the invoices and a declaration form and therefore, it cannot be seized. The Tribunal has further observed that these beadings are sold in cubic meters and whenever the goods will be sold by the opposite party the exact sale price would be disclosed and it is a matter of assessment where sale price will be examined.
Heard Sri B.K. Pandey, learned Standing Counsel and Sri N.C. Gupta, learned counsel appearing on behalf of opposite party.
Learned Standing Counsel states that the Tribunal is wrong in saying that under Section 50 of the VAT Act, the goods cannot be seized on the ground of under valuation. He submitted that Section 48 (1) of the VAT Act applies for seizure of the goods. He further submitted that under Section 50 (4) of the VAT Act the goods can be seized if the documents are not found genuine and proper and there is attempt to evade the tax. He further submitted that in the present case, invoice is not found to be genuine and proper as the value of the beadings has been mentioned in cubic meters in stead of running feet and on the valuation of the goods in the market, as against the disclosed value at Rs.1,54,093/-, the value has been estimated at Rs.13,06,453/-. Therefore, it is a patent case of under valuation, improper and non-genuine documents and an attempt to evade the tax.
Sri N.C. Gupta, learned counsel appearing on behalf of the opposite party submitted that under Section 50 of the VAT Act the goods can only be seized when the documents, namely, invoice or declaration form is shown non-genuine and improper. On the ground of under valuation the goods are not seized and it cannot be looked into at this stage. He further submitted that the Tribunal has rightly held that the matter of under valuation can be looked into at the stage of assessment and not at this stage.
In my view, the question whether the goods can be seized on the ground of under valuation is the matter which requires consideration by this Court.
Admit.
However on the facts and circumstances of the case, as the assessee is the registered dealer, the goods may be released on furnishing of cash security to the extent of tax on the value determined by the Joint Commissioner (SIB) Commercial Tax, Mathura in the seizure order.
Order Date :- 10.2.2011 OP