JUDGMENT
B.K. Lala, Judicial Member
1. This is an application under Section 8 of the West Bengal Taxation Tribunal Act, 1987 for setting aside the seizure of the goods made by the respondent No. 1 on April 4, 2002 at G.R.G.’s warehouse and for setting aside the penalty proceeding. The petitioner is a manufacturer of sponge iron and set up an industrial unit at Dr. Zakir Hussain Avenue, Durgapur. On March 26, 2002 he contacted R.K. Goyal of M/s. Steel and Metal Trading Co. at Netaji Subash Road, Kolkata, for providing adequate space for unloading 5 wagon load of Joist. He also contacted G.R. Goyal of M/s. G.I. Corporation at Netaji Subash Road, Kolkata, for providing similar space for unloading 4 wagons load of Joist, on rent at Rs. 25 per MT per month from the date of delivery of such goods till those are removed. An agreement was also made on March 26, 2002 between G.R. Goyal and the petitioner.
2. On March 26, 2002/March 27, 2002 more or less 300 MT of joist were unloaded at R.K. Goyal’s warehouse and 240 MT of joist at G.R. Goyal’s warehouse on March 28, 2002. On April 4, 2002 the respondent No. 1 along with some other officials visited the warehouse and without verifying any documents, seized those goods arbitrarily which were purchased from the Indian Iron and Steel Co. Ltd. (in short, “IISCO Ltd.”) and were not brought from outside West Bengal. Though information of seizure was given by the R.K. Goyal and G.R. Goyal over telephone, the matter was placed on record in writing by them on April 5, 2002. Both R.K. Goyal and G.R. Goyal moved before this Tribunal against the order of seizure and the application was registered being number RN-160 of 2002 and 161 of 2002. The petitioner claimed the ownership of the goods and it was decided in favour of the petitioner by the respondent No. 2 as per direction of the Tribunal.
3. On July 13, 2002 a notice was served in form 44 upon the petitioner and he was asked to show cause as to why penalty should not be imposed on him. Thus his ownership in respect of the goods was admitted by the respondents. The order of the seizure and the notice of imposition of penalty are illegal and liable to be set aside.
4. The respondent Nos. 1 and 2 denied all the allegations made out by the petitioner and alleged that seizure was rightly made for violation of the provisions of Section 97 and 88 of the West Bengal Sales Tax Act, 1994 read with Rule 17 of the Sales Tax Rules, 1995 (in short “Act, 1994”, “Rules, 1995”). The alleged agreement for rent is false and fabricated documents. The ownership of joist was denied by G.R. Goyal by letter dated April 11, 2002. The joist, as admitted by a letter dated March 12, 2002 are not required by the petitioner for the purpose of manufacturing sponge iron. The offer to deliver the goods actually was given by IISCO to K.K. Enterprise, though petitioner sent a cheque for Rs. 1,60,000 with declaration that no sales tax to be charged. The seized goods actually were not the identical goods sent by the IISCO, since no marking of IISCO has been found there to identify that the goods were delivered by IISCO. The goods actually delivered by IISCO might have been unloaded at some other godown. The seizure, therefore, rightly was made. RN-221 of 2002 was also heard since identical question of law is involved.
5. On behalf of the petitioner, it is submitted that search was held illegally without compliance of pre-seizure report as required under Section 67 of the Act, 1994. Before conducting search reasons for holding search must be recorded which was not done in the present case. The provisions of Section 68 of the Act, 1994 were never contravened as alleged. The goods since bore the mark of manufacturer, there was no scope to presume that the goods were imported by the petitioner from outside West Bengal illegally. The petitioner produced all the relevant documents before the respondent No. 2 but he failed to consider all the documents. The notice in form 44 was served upon the petitioner on July 13, 2002. The penalty proceeding is illegal and perverse and is liable to be set aside.
6. On behalf of the respondents, it is submitted that without compliance of the provisions of Section 97 and 88, the goods were stored in the godown which was not disclosed in the registration certificate. The agreement of tenancy was fabricated for the purpose of this case subsequent to seizure. The petitioner did not take steps immediate after the seizure of the goods. The joist purchased by the petitioner are not required for the manufacturing sponge iron. The goods were diverted to Howdah though the petitioner has an industry at Durgapur. The advance payment was made by the petitioner through cheque to IISCO requesting not to charge sales tax, with an undertaking that required form would be furnished by the petitioner. The goods actually delivered by the IISCO were taken to some other places, since the goods found in the godown do not bear any marking of IISCO. The petitioner kept the goods in other undisclosed godowns with an intention to evade payment of tax.
7. The only point for consideration is, if the seizure and penalty proceeding initiated are legal and valid.
8. The respondent Nos. 1 and 2 in their affidavit-in-opposition admits, “Hence I had no hesitation to admit the ownership of goods seized at undisclosed godown of the company located at the godown of G.I. Corporation Ltd. but the goods seized were not equated with the goods purchased from IISCO for the reasons stated above”. There is thus no dispute regarding the ownership of the goods in question. To be sure about identity of the goods, any authorised officer of IISCO should have been examined. But, no officer of the IISCO was examined to identify these goods in question. In such circumstances, it is difficult to come to presume that the seized goods were not at all sold by the IISCO. We, therefore, cannot support the reasons assigned by the respondents for coming to the findings that the goods were not purchased from IISCO by the petitioner.
9. Seizure can be made under Section 70, when the provisions of Section 68 or 73 were contravened with an intention to evade payment of tax. Intention cannot be proved by any tangible evidence. It has to be inferred from the facts and circumstances of each case. In the instant case, the seized goods were kept by the petitioner in the godown of others at Howdah without the knowledge and consent of the respondents. The Section 97 of the Act clearly states that a dealer shall give information regarding the change of his place of business or opening any new place of business within the prescribed time and manner. It is the contention of the learned lawyer for the petitioner that no time-limit has been prescribed under law for giving the information regarding the change of place of business. The Rule 16A was inserted only with the effect from June 1, 2003, whereas the facts of the case relate to the year 2002. Therefore, the dealer had no obligation to inform the change of address within a fixed time-limit under Rules. Hence, no offence was committed for keeping the goods in the others godown even without the knowledge of the respondents. We cannot accept such contention of the learned lawyer for the petitioner, inasmuch as, when no time limit has been prescribed information has to be given regarding any change without any delay or at least before any action is taken by the Revenue for non-compliance of the provision of Section 97 and such action can never be anticipated. It was, therefore, the duty of the petitioner to keep the Revenue informed about the place of unloading of the seized goods in question immediate before unloading to prove bona fide intention. Under Section 88(h) it is an offence not to furnish any information as required under Section 97. It is punishable under law even by confiscation of any seized goods under Section 70.
10. It further transpires that the telephonic talk regarding the settlement of rent of the godown was held finalized on March 26, 2002 whereas the order was placed for purchasing the joist from IISCO on March 12, 2002 (annexure “C” to the affidavit-in-opposition). Thus before searching for a suitable accommodation for storing the goods, any order can be placed to the IISCO, though it is admitted in a letter dated June 28, 2002, that joist is not required by the petitioner for its conversion to sponge iron for which he holds eligibility certificate. The tenancy agreement is also not a registered document so as to hold that it was not fabricated after the seizure of the goods. To prove bona fide, the documents ought to have been registered though registration is compulsory under law or revenue could have been informed. There is sufficient scope in the background of this case to take presumption that the alleged agreement of tenancy was created for the purpose of this case.
11. The petitioner, for purchasing the joist made advance of Rs. 1,60,000 as it transpires from the letter dated March 19, 2002 addressed to IISCO Ltd. claiming exemption of sales tax for which declaration form would be submitted afterwards. In course of such transaction, all on a sudden K.K. Enterprises appeared and wrote to AGM (Sales) IISCO Ltd., for issuing work order referring advance payment of Rs. 1,60,000 made by the petitioner without levying any tax as requested. However, the sales tax was voluntarily paid on April 12, 2002 whereas the seizure by this time was made on April 4, 2002. The petitioner on March 22, 2002 (annexure “H” to A.O.) wrote to AGM (Sales) for sending the goods to Durgapur forwarding of a cheque for Rs. 2,00,000 though according to petitioner, he had no sufficient space there, whereas previous to that by letter dated March 19, 2002 direction was given to IISCO to dispatch goods at Shalimar. Therefore, story of finalising the terms of the tenancy of the godown on rental basis in the last part of March, 2002 is baseless. We, therefore, hold that the petitioner had mala fide intention to keep the Revenue in dark regarding his new place for unloading the goods. This is clear violation of Section 97 of the Act and is an offence under Section 88(h) of the Act, 1994.
12. We, therefore, find no reason to set aside the order of seizure. The seizure is held to be legal and valid.
13. The application is, therefore, dismissed without costs. The RN-221 of 2002 for the same reason is dismissed without costs.
A. Deb, Technical Member
14. I agree.
