Skip to content


K.S. Papanna and anr. Vs. Deputy Commercial Tax Officer and ors. - Court Judgment

LegalCrystal Citation
SubjectSales Tax;Constitution
CourtAndhra Pradesh High Court
Decided On
Case Number Writ Petition Nos. 971 and 1044 of 1962
Judge
Reported in[1967]19STC506(AP)
AppellantK.S. Papanna and anr.
RespondentDeputy Commercial Tax Officer and ors.
Appellant Advocate N. Rammohan Rao, Adv. in W.P. No. 971 of 1962 and A.V.S. Ramakrishnaiah, Adv. in W.P. No. 1044 of 1962; D. Venkatappaiah Sastry, Adv. for ;Third Government Pleader
Respondent Advocate D. Satyanarayana, Adv. for respondent No. 2 in W.P. No. 971 of 1962
Excerpt:
- all india services act, 1951. sections 32(c) (as amended by section 3 of amendment act, 2005] & 10 & general clauses act, 1897, section 6: [g.s. singhvi, cj, dr.g. yethirajulu, ramesh ranganathan, g.bhavani prasad, c.v. nagarjuna reddy, jj] exemption of building from applicability of provisions of act held, (per majority) section 32(c) of the act provides that the provisions of the act shall not apply to any building the rent of which as on the date of the commencement of the a.p. buildings ( lease, rent and eviction) control (amendment) act 2005 exceeds rs.3,500/- per month in the areas covered by the municipal corporations in the state and rs.2,000/- per month in other areas. there is nothing in the provisions of the amendment act which either expressly or by necessary implication.....krishna rao, j.1. w. p. no. 971 of 1962.-this is an application under article 226 of the constitution of india for the issue of a writ in the nature of mandamus directing the deputy commercial tax officer, guntakal, to deliver back the goods seized by him from lorry a.p.a. 1599 on 13th september, 1962, under the following circumstances.2. the petitioner grows sugar-cane and converts the same into jaggery and sells it through commission agents. on one occasion, the petitioner entrusted 120 bags of jaggery, out of which 115 belonged to him and 5 to a relation of his, for the purpose of sale. the said bags of jaggery were sought to be transported to kurnool under a way-bill covering only 115 bags as belonging to the petitioner. during transit the lorry was checked and as some of the goods.....
Judgment:

Krishna Rao, J.

1. W. P. No. 971 of 1962.-This is an application under Article 226 of the Constitution of India for the issue of a writ in the nature of mandamus directing the Deputy Commercial Tax Officer, Guntakal, to deliver back the goods seized by him from lorry A.P.A. 1599 on 13th September, 1962, under the following circumstances.

2. The petitioner grows sugar-cane and converts the same into jaggery and sells it through commission agents. On one occasion, the petitioner entrusted 120 bags of jaggery, out of which 115 belonged to him and 5 to a relation of his, for the purpose of sale. The said bags of jaggery were sought to be transported to Kurnool under a way-bill covering only 115 bags as belonging to the petitioner. During transit the lorry was checked and as some of the goods were not covered by the way-bill, the Deputy Commercial Tax Officer, Guntakal, seized the entire stocks of 120 bags. On receipt of information, the petitioner filed his objections and in spite of repeated requests pointing out the urgency for the disposal of the goods, the petitioner did not get any reply from the authority, but came to know that his commission agent at Kodikonda received a notice that the jaggery would be sold on 25th October, 1962. Without even passing an order of confiscation of the goods, the Deputy Commercial Tax Officer gave notice to sell the goods in public auction as they were of a perishable nature. Before the order of confiscation could be passed, the petitioner filed this application challenging the action of the Commercial Tax Officer on two grounds : firstly that Section 29 of the Andhra Pradesh General Sales Tax Act, 1957, in so far as it provides for confiscation of goods, is ultra vires of the Legislature and secondly, that, in any event, the said power of confiscation is invalid as it violates the fundamental right of the petitioner guaranteed to him under Article 19(1) of the Constitution of India being an unreasonable restriction on the holding of property.

W. P. No. 1044 of 1962.

3. This is an application under Article 226 of the Constitution of India for the issue of an order in the nature of mandamus directing the Assistant Commercial Tax Officer, Rajampet, to return the goods confiscated by him from the petitioner under the following circumstances : The petitioner is a firm of merchants doing business in various commodities including fertilizers. On one occasion, the Assistant Commercial Tax Officer, Rajampet, made a surprise inspection of its godowns and discovered that certain quantities of goods in the petitioner's possession have not been accounted for in its books of account. After taking the necessary statements from the petitioner, the Assistant Commercial Tax Officer confiscated the goods which were not accounted for and passed an order to the said effect on 16th October, 1962. Without filing an appeal against the order of confiscation, the petitioner filed the present writ petition to this Court raising two questions: firstly, that Section 28(6) of the Andhra Pradesh General Sales Tax Act, 1957, is ultra vires of the State Legislature and, secondly, that in any event, the said provision of law offends Articles 14 and 19(1)(f) and (g) of the Constitution of India.

4. We would have been extremely reluctant to entertain these writ petitions at the instance of the parties who have failed to pursue the remedies provided under the Act, except for the fact that the cases were posted before a Division Bench by a learned Judge of this Court on the ground that they raised questions challenging the vires of the statute and also questions of constitutional validity. As these two writ petitions involve common questions they are being disposed of by a common judgment.

Point No. 1.-The first point raised before us is that Section 28(6) and Section 29(3) of Andhra Pradesh General Sales Tax Act in so far as they provide for confiscation of goods, are ultra vires of the State Legislature and that they should therefore be struck down.

5. The relevant provisions of the Act may be summed up as follows : Section 28(1) authorises any officer of the State Government to require any dealer to produce before him the accounts, registers and other documents and to furnish any other information relating to his business. Sub-section (2) of Section 28 says that all such accounts, registers and other documents maintained by a dealer in the course of his business shall be open to inspection at all reasonable times. Sub-section (3) authorises the concerned officer to seize such accounts, registers or other documents of the dealer if the officer has reason to suspect that, the dealer is attempting to evade the payment of the tax due from him under the Act and various other provisions are made regulating the retention of the books by the officer. Sub-section (4) confers the power to enter and search at all reasonable times, any office, shop, godown, vessel, vehicle or any other place of business or any building or place where such officer has reason to believe that the dealer has been keeping the goods, accounts, etc. Sub-section (5) gives the power to the officer to break open any box in which any accounts or documents are kept or to break open the door of any premises where such documents may be kept. Sub-section (6) of Section 28 which is impugned before us runs as follows :

Any such officer shall have power to seize and confiscate any goods which are found in any office, shop, godown, vehicle, vessel or any other place of business or any building or place of the dealer, but not accounted for by the dealer in his accounts, registers and other documents maintained in the course of his business :

Provided that before taking action for the confiscation, of goods under this sub-section, the officer shall give the person affected an opportunity of being heard and make an inquiry in the prescribed manner.

Explanation.-It shall be open to the State Government to authorise different classes of officers for the purpose of taking action under Sub-sections (1), (2) and (3).

6. Section 29 lays down the procedure for the establishment of check post or barrier and for inspection of goods while in transit. Sub-section (1) of Section 29 provides for the setting up of a check post or a barrier at a place to be notified with a view to prevent or check the evasion of tax under the Act. Sub-section (2) authorises an officer of the State Government to inspect all records relating to the goods carried at the check post and requires the person in charge of the transit to give the name and address of the owner of the vehicle or boat if required so to do. Sub-section (3) which prescribes for confiscation reads as follows :

The officer in charge of the check post or barrier, or the officer empowered as aforesaid shall have power to seize and confiscate any goods which are under transport by a goods vehicle or a boat and are not covered by a way-bill issued by the person who consigns the goods in such form and containing such particulars as may be prescribed :

Provided that before taking action for the confiscation of the goods under this sub-section, the officer shall give the person affected an opportunity of being heard and make an inquiry in the manner prescribed.

7. Rule 45 of the Andhra Pradesh General Sales Tax Rules of 1957 prescribes an elaborate procedure as to how dealers liable to pay tax under the Act should maintain accounts, vouchers, registers etc. Rule 46 lays down the machinery for the establishment of check posts or barriers for the inspection, seizure and for confiscation of goods. Rule 46(8) reads as follows :

46. (8) Where a confiscation was ordered for the reason that the owner was not ascertainable, such person or any person on his behalf may appear before the officer ordering the confiscation, and satisfy him with relevant record regarding the bona fides of the transport of the goods in question. If the officer is satisfied that there has been no evasion of tax he may, for reasons to be recorded in writing, order the release of the confiscated goods. The officer shall also specify in his orders the amount due to be paid towards the charges, if any, incurred by the State for the safe custody of the goods and other incidental charges. If the officer is not so satisfied, he may after recording the reasons therefor, order that the sale under Sub-rule (5) may be proceeded with.

8. Rule 48(1) runs as follows:-

If any officer authorised under Section 28 of the Act, finds any goods in any office, shop, godown, vehicle, vessel or any other place of business or any other building, or place of a dealer which have not been accounted for in his accounts, registers or other documents maintained in the course of his business, he may seize and confiscate such goods after following the procedure prescribed in Rule 46...

9. The order of confiscation is open to appeal under Section 19 of the Act.

10. As already stated, the contention of the learned counsel for the petitioners is that the power to confiscate the goods does not fall within the ambit and scope of the legislative power conferred on the State under Entry 54 of List II of Schedule VII appended to the Constitution of India. The said Entry 54 reads as follows :

Taxes on the sale or purchase of goods other than newspapers...

11. It is now well-settled by more than one decision of the Supreme Court that the power to levy a tax includes all incidental powers to prevent the evasion of such tax. In Chaturbhai v. Union of India A.I.R. 1960 S.C. 424, it was observed that in the interpretation of the scope of items in the Legislative Lists in Schedule VII the widest possible amplitude must be given to the words used and each general word must be held to extend to ancillary or subsidiary matters which can fairly be said to be comprehended in it. In Baldev Singh v. Income-tax Commissioner A.I.R. 1961 S.C. 736, considering the validity of Section 23A of the Indian Income-tax Act, 1922, their Lordships of the Supreme Court pointed out:

As is well known the legislative entries have to be read in a very wide manner and so as to include all subsidiary and ancillary matters. So Entry 54 should be read not only as authorising the imposition of a tax but also as authorising an enactment which prevents the tax imposed being evaded. If it were not to be so read, then the admitted power to tax a person on his own income might often be made infructuous by ingenious contrivances. Experience has shown that attempts to evade the tax are often made...

12. Similarly in Balaji v. Income-tax Officer A.I.R. 1961 S.C. 736, it was stated as follows :

It is well-settled that the entries in the lists are not powers but are only fields of legislation, and that widest import and significance must be given to the language used by Parliament in the various entries.

13. Again, in the latest case of Abdul Quader and Co. v. Sales Tax Officer [1964] 15 S.T.C. 403, considering the validity of Section 11(2) of the Hyderabad General Sales Tax Act, 1950, the Supreme Court observed as follows :

Now there is no dispute that the heads of legislation in the various lists in the Seventh Schedule should be interpreted widely so as to take in all matters which are of a character incidental to the topics mentioned therein. Even so, there is a limit to such incidental or ancillary power flowing from the legislative entries in the various lists in the Seventh Schedule. These incidental and ancillary powers have to be exercised in aid of the main topic of legislation, which in the present case, is a tax on sale or purchase of goods. All powers necessary for the levy and collection of the tax concerned and for seeing that the tax is not evaded are comprised within the ambit of the legislative entry as ancillary or incidental...'

14. Hence, the question that falls for decision is whether confiscation of the goods is a power ancillary or subsidiary to the object of preventing evasion of tax under the Act.

15. A similar question was raised before the Mysore High Court in Venkatachalapathi v. Commercial Tax Inspector [1965] 16 S.T.C. 894, in which the validity of Section 28-A of the Mysore Sales Tax Act, 1957, relating to confiscation of goods was considered. It was held in the above decision of the Mysore High Court, (i) that the power to legislate on a topic of legislation carries with it the power to legislate on an ancillary matter which can be said to be reasonably included in the power given and that the power to provide for the taking of steps to prevent evasion of tax is reasonably related to the legislative power itself of imposing such tax ; (ii) that persons who are not directly liable to pay the tax may also have their activities reasonably restricted with a view to prevent the principal persons liable to tax from evading payment of tax ; (iii) that Section 28-A of the Mysore Sales Tax Act, 1957, does not purport to levy any tax and, therefore, there is no possibility of either exempted goods or inter-State transactions being exposed to levy of tax not lawfully exigible; and (iv) that the section does not say that the payment demanded by it, though not a tax, shall be paid as if it were a tax and that what it does is to make certain provisions with a view to prevent evasion of tax and to impose penalty for contravention of those provisions. Penalty is intended to make the machinery against evasion effective. Referring to Sub-section (6) of Section 28-A of the Mysore Sales Tax Act which provides for confiscation or payment of certain sum of money in lieu thereof, the learned Judges observed that the said amount or the confiscation is not intended to be collected as a tax but

obviously it is in the nature of a punishment for contravention of the section rendering the goods liable for confiscation. Whether one looks upon confiscation itself as the primary punishment or the payment as the primary punishment and confiscation only an effective way of enforcing the said payment, there can be ho doubt that what the section purports to do is to punish a person for failure to obey it and not to impose on him a tax in respect of his turnover... A more appropriate analogy for it is to be found in statutes like the Central Excises and Salt Act, Sea Customs Act, etc., in which the authorities functioning under the said statutes are themselves authorised in certain circumstances to confiscate goods answering a particular description and also levy penalty on a person for contravention of certain provisions of the Act or rules made thereunder, irrespective of or in addition to whatever liability there may be for payment of excise duties or customs duties... the information sought under the impugned section is only for identifying the nature of the transaction and tracing the dealer only with a view to see that a person or a transaction legitimately liable to sales tax under the State Act does not escape payment of such tax.

16. Distinguishing the decision of the Supreme Court in Abdul Quader and Co. v. Sales Tax Officer [1964] 15 S.T.C. 403, the learned Judges stated that Section 28-A of the Mysore Act 'does not say that the payment demanded by it, though not a tax, shall be paid as if it were a tax. What it does is to make certain provisions with a view to prevent evasion of tax and to impose penalty for contravention of those provisions. Penalty is obviously intended to make the machinery against evasion effective.' It was accordingly held on the above reasoning that the impugned provision being intended as a step for preventing evasion, it was within the ambit of ancillary powers of legislation under Entry 54 of List II in the Seventh Schedule of the Constitution. While upholding the legislative vires of the section, the Mysore High Court no doubt struck down the section as the procedure laid down thereunder offends Article 19 of the Constitution. We will refer to this point at the appropriate stage.

17. The same question came up for consideration before the Madras High Court in R. S. Jhaver v. Commissioner of Commercial Taxes [1965] 16 S.T.C. 708 in which, while upholding the power of seizure of the goods, the learned Judges held that the power to confiscate the goods under Section 14(4) of the Madras General Sales Tax Act, 1959, does not come within the ambit of Entry 54 of List II of the Seventh Schedule of the Constitution as it is neither ancillary nor incidental thereto and that therefore invalid. While stating that the entries in the legislative lists prescribed only the field of legislation including all incidental and ancillary powers, the learned Judges following the case in Abdul Quader and Co. v. Sales Tax Officer [1964] 15 S.T.C. 403 held that the power to confiscate the goods is not an ancillary power. It was observed as follows (referring to the above Supreme Court decision):

Though there is no analogy to the present context, the principle of this decision is clear that what has been properly a subject within the ambit of a legislative head of power including ancillary and incidental powers flowing therefrom, cannot be indirectly legislated upon under the guise of making a law which might otherwise be within the limits of legislative head of power. We are of the view that the provision for seizure and confiscation of goods offends that principle.

18. It was further observed that the power of confiscation cannot be ancillary or incidental to the power to tax a sale or a purchase even from the standpoint of checking evasion or making evasion unprofitable, that the Act is not a law on goods and that no such law can be made in the guise of Entry 54. With great respect to the learned Judges, we are unable to accept this view for the following reasons:

The principle underlying the decision in Abdul Quader and Co. v. Sales Tax Officer [1964] 15 S.T.C. 403 is that 'the Legislature cannot under Entry 54 relating to taxation make a provision to the effect that even though a certain amount collected is not a tax on the sale or purchase of goods, it will still be collected as if it were such a tax.' The Supreme Court, in the said ruling, was considering the validity of Section 11 of the Hyderabad General Sales Tax Act (14 of 1950) which is to the following effect: Sub-clause (1) of Section 11 lays down that no unregistered dealer shall collect any amount by way of tax under the Act. Sub-clause (2) of that section provided that every person who has collected any amount by way of tax otherwise than in accordance with the provisions of that Act shall pay over to the Government the amount so collected by him and in default the amount shall be recovered as if it were arrears of land revenue. Referring to the language of this section, the Supreme Court pointed out that it is not open to the Government to collect from the dealers what they have unlawfully collected from their customers. In other words, the State Government has no power to collect money which is not a tax as if it were a tax. Under these circumstances, it was held that in the guise of ancillary legislation, such a power to collect monies cannot be justified. We do not see that the principle of the said case has any analogy to the present case. In this connection, we are inclined to agree with the view of the learned Judges of the Mysore High Court that the power to seize and confiscate the goods is only by way of punishment or penalty which is intended to operate as the most effective deterrent against tax-evaders, and that it is, therefore, ancillary in the sense that it seeks to achieve the object of preventing evasion of tax. It is contended by Shri N. Rammohanrao, the learned counsel for the petitioner that though confiscation of goods may be one of the modes of checking evasion of tax, it is not an ancillary power because it may not be necessary to impose such a drastic step and that a mere inspection of the accounts or the goods and documents, etc. is sufficient to gather the material or data to levy tax or penalty from the dealer. It is not for us to say what particular measure would carry with it the required deterrent effect. So long as the steps or the measures taken by the State Legislature are directed towards the achievement of the object of prevention of evasion of tax, they come within the scope of ancillary powers irrespective of the question whether it may be necessary or not for the Legislature to impose a drastic provision or only a lenient punishment. The other objection stated by the learned Judges of the Madras High Court is that the Act is not a law on goods and that the power to confiscate does not really come within the ambit of the power to tax. No doubt, as pointed out by the Supreme Court in In re Sea Customs Act, A.I.R. 1963 S.C. 1760, sales tax, like the excise duty, is not a direct tax on the goods such as the direct taxes on property or income. It is only in the nature of an indirect tax, as the taxable event in either case is either the manufacture of the goods or the sale of the goods, respectively. Similarly, even in the case of Sea Customs Act, while the duties are levied on the movement of the goods across the customs barrier, the confiscation of the goods or even a vessel which does not conform to the customs rules is justified on the ground of preventing evasion of customs duties, though it is not a direct tax on the goods. Hence, for all the above reasons, we are inclined to accept the Mysore view in preference to the Madras view and hold that the impugned sections of the Andhra Pradesh General Sales Tax Act, in so far as they relate to confiscation of goods under Sections 28 and 29 are within the powers of the State Legislature and hence valid.

Point 2.--The second point raised by the learned Advocates for the petitioners is that the provision of law relating to the confiscation of goods, clothes the concerned authority with excessive and arbitrary power and that it, therefore, offends Articles 14 and 19(1)(f) and (g) of the Constitution of India, on the ground that the said powers cannot be regarded as reasonable restrictions on the holding or enjoyment of property or the carrying on of business by the dealer. On this aspect of the case, the Mysore High Court in the case referred to already, i.e., Venkatachalapathi v. Commercial Tax Inspector [1965] 16 S.T.C. 894, held that

section 28-A of the Mysore Sales Tax Act while providing for an enquiry, has totally failed to indicate what the purpose of enquiry is and the so-called enquiry provided in the section must be regarded as a pretence, and that the procedure offends Article 19.

19. With great respect, we are unable to accept this conclusion. In Chaturbhai v. Union of India A.I.R. 1960 S.C. 424, dealing with the contention that certain Central Excise Rules laying down restrictions on warehousing and penalties providing for confiscation etc. are unreasonable and not saved by Article 19 of the Constitution of India, the Supreme Court observed as follows:

The basis of this argument was that there is no procedure laid down in the provisions for levying penalties nor any provision made for notice or taking of evidence and power of confiscation was given to persons who could not be termed unbiassed. If the tribunal is to act judicially it must conform to the principles of natural justice of audi alterant partem and there is no dispute that in the instant case there was no breach of this rule. Not only this, there is a right of appeal and a revision is also provided and both these remedies the petitioner availed himself of. The argument of unreasonable restrictions because of this ground must also fail.

20. Again in Collector of Customs v. Sampathu Chetty A.I.R. 1962 S.C. 316, in dealing with an argument that Section 178A of the Sea Customs Act which operates to cast the burden of proof on the person from whose possession gold is seized to establish that the goods are not smuggled, has over-stepped the limits of reasonableness, in imposing restraint on the freedom guaranteed under Article 19(1)(f) and (g), the Supreme Court observed to the following effect: The test for ascertaining the reasonableness postulated by clauses (2) to (6) of Article 19

should be applied to each individual statute impugned, and no abstract standard or general pattern of reasonableness can be laid down as applicable to all cases. The nature of the right alleged to have been infringed, the underlying purpose of the restrictions imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, should all enter into the judicial verdict. It would be apparent that this is in line with the great principle underlying the structure of the rights guaranteed by Article 19, viz., a balancing of the need for individual liberty in the matter, inter alia, of the right to hold property or of the right to carry on trade, with the need for social control in order that the freedoms guaranteed to the individual subserve the larger needs-moral, social, economic and polictical-of the community and thus ensure orderly progress towards the goal indicated by the preamble. It would follow that the reasonableness of the restraint would have to be judged by the magnitude of the evil which it is the purpose of the restraint to curb or eliminate.

21. It was also observed with reference to the contention that the procedure indicated in the rules for confiscation and adjudication does not provide for sufficient safeguards to prevent abuse of power on the part of ths concerned officials, as follows :

The possibility of abuse of a statute otherwise valid does not impart to it any element of invalidity...The constitutional validity of the statute would have to be determined on the basis of its provisions and on the ambit of its operation as reasonably construed.

22. Referring to the argument under Article 14 of the Constitution it was again observed in the said ruling as follows :

No doubt, there are situations when the points regarding a violation of Article 14 and an objection that a restriction is not reasonable so as to conform to the requirements of Article 19(5) or (6) may converge and appear merely as presenting the same question viewed from different angles. Such, for instance, are cases when the denial of equality before the law is based on the ground that the power vested, say, in an administrative authority to affect rights guaranteed to a citizen is arbitrary, being ungraded or uncanalised. The vesting of such a power would also amount to the imposition of an unreasonable restriction on the exercise of the guaranteed right to trade or carry on a business etc. Where, however, there is guidance and the legislation is challenged on the ground that the law with the definite guidance for which it provides has outstepped the limits of the Constitution by imposing a restraint which is either uncalled for or unreasonable in the circumstances, the scope and content of the enquiry is far removed from the tests of conformity to rational classification adopted for judging whether the law has contravened the requirement of equal protection under Article 14.

23. Similarly in Balaji v. Income-tax Officer A.I.R. 1962 S.C. 123, in dealing with the question of reasonableness of restrictions it was stated that the object sought to be achieved by Section 16(3) of the Income-tax Act is to prevent the prevalent abuse, namely, evasion of tax by an individual doing business under a partnership nominally entered with his wife or minor children.

24. In view of the above principles laid down by the Supreme Court, it is not possible to say that the procedure laid down by the rules under the Andhra Pradesh General Sales Tax Rules of 1957 for seizure and confiscation of goods imposes any unreasonable restrictions or confers any unreasonable or unguided power in the hands of the concerned officer. As already pointed out, the rules lay down an elaborate procedure and contemplate various stages before the order of confiscation is passed. The party is heard and given an opportunity to submit his explanation. If the officer is satisfied with the explanations, he is required to release the goods and if he is not so satisfied he has to pass an order of confiscation and the said order is open to appeal and revision etc. We cannot assume that the officers entrusted with the said duties are bound to be arbitrary and not amenable to reason. It was further argued by the learned Advocate for the petitioners that the moment goods are seized there is no more opportunity for the party to state his case. This argument is based upon a fallacy because the learned counsel has failed to appreciate the distinction between the two stages of seizure and confiscation. The whole process of confiscation consists of three stages; firstly, inspection and checking on the basis of the way-bills or accounts ; secondly, seizure of the goods if the same are not disclosed in the accounts or by the way-bills. At this stage, the party is given an opportunity to show cause why the goods should not be confiscated. It is only when the explanation is found unsatisfactory that the officer has to pass the order of confiscation and until he passes such order of confiscation, he merely retains the goods in his custody. Hence, it cannot be said that confiscation of the goods provided for under the Act is not preceded by any enquiry giving opportunity to the party to show cause against the same. The fact that the officers in charge of the duty of seizure and confiscation are likely to abuse their powers is not a ground as pointed out by the Supreme Court for invalidating the statute. We have not been shown how the rules under the Mysore Act stand in comparison with the rules under the Andhra Pradesh Act. Regarding the provisions for confiscation of goods as the extreme deterrent punishment intended to achieve the object of evasion of taxes, we are not prepared to hold that confiscation of the goods would be an unreasonable restriction on the holding of property or the carrying on of business by a dealer. As already stated, the reasonableness of a restriction or a provision of law has to be judged with reference to various factors enunciated above. We are, therefore, convinced that the procedure laid down under the rules cannot be said to be violative of Article 14 or 19(1)(f) or (g) of the Indian Constitution.

25. In the view we have taken above, it is not necessary to deal with the alternative argument advanced by Sri D. Venkatappaiah Sastry, on behalf of the Government, that even if the provisions of Sections 28 and 29 of the Act do not fall within the scope and ambit of Entry 54 relating to taxation of sale or purchase of goods, it may be brought in under Entry 26 of List II which relates to ''trade and commerce'.

26. In Writ Petition No. 971 of 1962, we are told that no order of confiscation has at all been passed. If the said statement is correct, an order of confiscation has to be passed in which case, the petitioner will have a right of appeal to show cause against the same. Even otherwise, it was argued by Sri N. Rammohanrao, the learned counsel for the petitioner that the Commercial Tax Officer is not justified in seizing 115 bags of jaggery which are admittedly covered by the way-bill. The learned Government Pleader has not been able to justify the action of the Commercial Tax Officer in having seized the goods which are covered by the way-bill. Hence, the seizure of 115 bags is not justified in law. The petitioner is stated to have taken delivery of 115 bags after furnishing security. Hence W.P. No. 971 of 1962 is allowed with respect to 115 bags and it is dismissed with regard to the remaining five bags in respect of which the Commercial Tax Officer may hold an enquiry as contemplated by law. The security taken from the petitioner will, therefore, be cancelled. The writ petition is, therefore, allowed in part; but there will be no order as to costs.

Writ Petition 1044 of 1962 is dismissed with costs. Advocate's fee Rs. 100.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //