M/s. Jeyyam Global Foods (P) Ltd., Versus Union of India, Through its Secretary (Revenue), Ministry of Finance, and Others
GST
2019 (2) TMI 124 – MADRAS HIGH COURT – 2019 (21) G. S. T. L. 465 (Mad.) , [2019] 64 G S.T.R. 129 (Mad)
MADRAS HIGH COURT – HC
Dated:- 23-1-2019
WP(MD)No. 937 of 2019 and WMP(MD)Nos. 764 & 765 of 2019
GST
MR. G.R. SWAMINATHAN J.
For Petitioner: Mr. S. Jaikumar
For Respondents: Mr. P. Dharmaraj for R1 Mr. Vijayakarthikeyan for R2 &R3 Mr. Aayiram K. Selvakumar Additional Government Pleader for R4
ORDER
The petitioner is a manufacturer of dried chick peas, gram flour, pulses and grams. The petitioner's claim is that they purchase chick peas, dry them by heating them to a certain degree and the resultant product is known as “Dried Chick Peas”.
According to the petitioner, this would have to be classified only under Chapter 0713 of HSN. The petitioner had transported the dried chick peas from Salem to Dindigul. The petitioner had not fi
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as not open to the Squad Officer to have done so.
3. Heard the learned counsel on either side. The contesting respondent is only the fourth respondent. The fourth respondent official appeared in person and assisted this Court. He also filed a detailed counter affidavit.
4. According to the fourth respondent, he is statutorily empowered under Section 68 r/w Section 129 of the Tamil Nadu Goods and Services Tax Act, 2017. Section 68 of the said Act reads as under :
“Section 68 (1) : The Government may require the person in charge of a conveyance carrying any consignment of goods of value exceeding such amount as may be specified to carry with him such documents and such devices as may be prescribed.
(2) The details of documents required to be carried under sub-section (1) shall be validated in such manner as may be prescribed.
(3) Where any conveyance referred to in sub-section (1) is intercepted by the proper officer at any place, he may require the person in charge of the sa
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goods comes forward for payment of such tax and penalty;
(b) on payment of the applicable tax and penalty equal to the fifty per cent. of the value of the goods reduced by the tax amount paid thereon and, in case of exempted goods, on payment of an amount equal to five per cent. of the value of goods or twenty five thousand rupees, whichever is less, where the owner of the goods does not come forward for payment of such tax and penalty;
(c) upon furnishing a security equivalent to the amount payable under clause (a) or clause (b) in such form and manner as may be prescribed: Provided that no such goods or conveyance shall be detained or seized without serving an order of detention or seizure on the person transporting the goods.”
5. The stand of the fourth respondent is that he is entitled to call upon the person in charge of the conveyance to produce the documents in question for verification. In the present case, there is no dispute as to the goods that were actually transporte
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for consideration before the Hon'ble Kerala High Court in the decision reported in 2018 (11) TMI 1503 (N.V.K. Mohammed Sulthan Rawther and Sons and Willson Vs. Union of India). The Hon'ble Kerala High Court held that in such cases at best the inspecting authority can alert the assessing authority to initiate the proceedings “for assessment of any alleged sale, at which the petitioner will have all his opportunities to put forward his pleas on law and on fact.” The process of detention of the goods cannot be resorted to when the dispute is bona fide, especially, concerning the exigibility of tax and, more particularly, the rate of tax.
8. I am in full agreement with the aforesaid enunciation of law laid down by the Hon'ble Kerala High Court. Here, a bonafide dispute with regard to the classification has arisen between the transporter of goods and the squad officer. I am of the view that the squad officer can intercept the goods, detain them for the purpose of prepar
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e matter cannot rest there. The learned counsel for the writ petitioner would strongly press that this Court will have to direct the Commissioner of Commercial Taxes, Chennai to issue appropriate directives in this regard. I find force in the said request. This Court therefore suo motu impleads the Commissioner of Commercial Taxes, Chennai as the fifth respondent in this writ petition and directs Shri.Aayiram K.Selvakumar, the learned Additional Government Pleader to take notice for him also.
11. The Commissioner of Commercial Taxes, Chennai is directed to issue a circular to all the inspecting squad officers in Tamil Nadu not to detain goods or vehicles where there is a bonafide dispute as regards the exigibility of tax or rate of tax.
The circular shall embody the essence of the decision reported in 2018 (11) TMI 1503 (N.V.K. Mohammed Sulthan Rawther and Sons and Willson Vs. Union of India). Such a circular shall be issued within a period of eight weeks from the date of receipt of
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