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M/S Hina Traders v. State Of U.P. & Others - WRIT TAX No. 1392 of 2006  RD-AH 15477 (6 September 2006)
Civil Misc. Writ Petition No. 1392 of 2006
Hon'ble Sushil Harkauli, J.
Hon'ble G.P. Srivastva, J.
We have heard Sri S.D. Singh learned counsel for the petitioner and the learned standing counsel for the respondents.
The Commissioner of Trade Tax has issued a circular dated 20.1.2006, copy of which has been enclosed as Annexure 2 to this writ petition. The circular provides that as a precondition for issue of import declaration forms (i.e. Form XXXI) under the U.P. Trade Tax Act, cash deposit of security under section 8-C (3-A) should be got deposited on the commodities mentioned in the said circular. The commodities mentioned in the first of the four items of the said circular are various items of iron and "various kinds of iron scrap". Various items of steel are also mentioned in the other three items but "steel scrap" or "stainless steel scrap" is not mentioned.
This situation can lead to only two possible interpretations as follows : (1) first, that the circular dated 20-1-2006 does not apply to steel scrap or stainless steel scrap and therefore no security is payable for issue of Form XXXI for importing ''steel scrap'; or (2) second, that ''steel scrap' or ''stainless steel scrap' would be covered by the term "iron scrap" and accordingly security would be liable to be deposited under the circular for getting Form XXXI.
The case of the petitioner is that after depositing security he got certain Form XXXI issued, against which the petitioner tried to import ''stainless steel scrap'. The trade tax authorities at the entry check post detained four consignments out of which one consignment has been seized. Against the seizure, a representation of the petitioner has been rejected, relying upon the decision of a learned Single Judge of this Court in the case of Commissioner of Sales Tax Versus S/s Manish Metal Works, 2004 NTN (Vol. 24) 388. The appeal by the petitioner against the seizure is pending.
It is contended by the petitioner that the decision of the learned Single Judge relied upon by the trade tax authorities has no application in this case. We examined the said decision, copy of which has been annexed as Annexure 9 to this writ petition. The decision was given in a different context and does not even purport to interpret the phrase "iron scrap" as used in the Commissioner's circular dated 20.1.2006 or the effect of non-inclusion of a separate item of ''steel scrap' or ''stainless steel scrap' in the said circular.
In respect of three other consignments i.e. other than the consignment which has been seized, detention notice has been issued to the petitioner.
As already stated above, of the two interpretations given above in this order, the first interpretation is more to the disadvantage to the trade tax department. The second interpretation given above requires security, which has already been deposited by the petitioner. Prima facie no third interpretation is possible.
In the circumstances, we are prima facie of the opinion that the detention or the seizure of the consignments only on the above ground is not justified. If there is no other ground of detention, the respondents No. 3 to 6 are directed to release the consignments of the petitioner after examining the consignments and preparing an inventory of the consignments by describing each consignment in detail and, if necessary, after retaining a small sample of each consignment, provided the petitioner is prepared to counter sign the inventory. No other or further security will be demanded for such release.
A counter affidavit may be filed by the respondents represented by the standing counsel within a month. List thereafter.
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