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Yogendra Singh v. State Of U.P. & Others - WRIT TAX No. 1372 of 2005 [2006] RD-AH 15206 (1 September 2006)


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Court No. 36

Civil Misc. Writ Petition No. 1372 of 2005

Yogendra Singh


State of U.P.  and others


Hon'ble Sushil Harkauli, J.

Hon'ble G.P. Srivastva, J.

We have heard learned counsel for the petitioner and the learned standing counsel. Counter and rejoinder affidavits have been exchanged.

The petitioner claims to be owner of the vehicle, which is a truck, bearing the No. HR-46A / 4692. This vehicle was being used to transport goods allegedly across the State of Uttar Pradesh.

The driver (or the person incharge) of the said vehicle is said to have obtained a transit pass (in Form XXXIV) alleging that the goods loaded in the vehicle which were coming from outside the State of U.P. and were intended to be transported through the State to a place outside the State of Uttar Pradesh. Having obtained this transit pass at the entry check post, the same was not surrendered at the exit check post, thereby raising a presumption under section 28-B of the U.P. Trade Tax Act, that the goods have been sold inside the territory of the State of Uttar Pradesh resulting in the liability to pay trade tax.

The petitioner's vehicle has been detained by the trade tax authorities for realization of the trade tax. The petitioner has filed this writ petition for release of the vehicle.

Admittedly assessment has been made against the petitioner under the U.P. Trade Tax Act, and the assessment order is appealable.

The first argument of the learned counsel for the petitioner is that the petitioner is ''merely' the owner of the vehicle and he is not liable if the goods have been sold in Uttar Pradesh. The argument is totally misconceived and we refuse to believe such total lack of knowledge of the U.P. Trade Tax Act on part of the learned counsel. We will therefore assume that the argument has been advanced merely for the sake of argument. The scheme of the Act and particularly of issuing transit passes basically is that where goods come from outside the State and are intended to be transported to another place outside the State and are therefore merely passing through the State of Uttar Pradesh, no trade tax is leviable. But in order to check evasion of trade tax, a transit pass (in the prescribed Form XXXIV) is to be got issued by the driver (or the person incharge) of the vehicle at the trade tax check post at the point of entry into the State of Uttar Pradesh. This form provides a time frame within which the vehicle has to pass out of the State of Uttar Pradesh. It also requires that the goods will not be unloaded anywhere inside the State. At the exit check post the transit pass (Form XXXIV) has to be surrendered to enable the trade tax authorities at the said exit check post to verify whether all the goods mentioned in the transit pass have passed out intact.

If the transit pass is not surrendered at the exit check post or the goods mentioned in the transit pass are not found intact in their entirety at the point of exit, a rebuttable presumption arises under section 28-B that the goods have been sold within the territory of Uttar Pradesh.

It is obvious that in such an event, the goods can not be got hold of and it is only the vehicle and its owner which can be caught by the department for realisation of the tax dues. Therefore, primary liability is on the vehicle and its owner. The person incharge of the vehicle being directly responsible for getting Form XXXIV issued and not surrendering the same will also be liable. Thus, under section 28-B of the U.P. Trade Tax Act, the transporter has also been deemed to be the owner of the vehicle for that purpose.

Thus, assessment can be made against the transporter, the driver or the person incharge of the vehicle and also against the owner of the vehicle.

The second argument from the petitioner's side is that a proper notice prior to the assessment has not been issued and has not been validly and properly served upon the petitioner. These are essentially factual questions, which could have been raised in an application for setting aside of the assessment, which is said to be ex parte or in an appeal against the assessment order. Factual  questions are normally not to be investigated in writ jurisdiction.

Besides nothing has been filed in this writ petition to rebut even prima facie the presumption raised under section 28-B against the owner or the transporter.

The third argument from the petitioner's side is based upon a decision of the Division Bench of this Court in the case of Devendra Kumar Versus Sales Tax Officer and others, 1990 U.P.T.C. 1162.  Having examined the decision, we find that it does not apply at all in the present case. In that decision the Court was dealing with the justification of refusing issue of Form XXXIV based on suspicion and instead of issue of the Form detention of the goods and the vehicle at the point of entry.

The decision cited from the petitioner's side cannot possibly be held to mean that if the petitioner has brought goods into the State of Uttar Pradesh against Form 34 and has not surrendered the Form 34, then unless an immediate apprehension of the goods or the vehicle is made, the petitioner would become entitled to get away with the tax evasion because subsequent detention for tax realization would stand barred. Such an interpretation would go contrary to the basic scheme of the Act.

We do not find any force in the legal argument and as already stated above, we decline to enter into the factual questions in view of the alternative remedy provided by the statute.

The writ petition is accordingly dismissed.

Dated: September 1, 2006



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