1. This writ petition has been heard after a notice to show cause was issued. As a short point is involved, we issued rule DB and proceed to decide the petition.
In this case the first respondent has withheld grant of ST-1 forms to the petitioner, who is a registered dealer. We have been taken through the Delhi Sales Tax Rules and particularly rule 8 which deals with the procedure and powers of the Sales Tax Officer in relation to the issue of ST-1 forms. The learned counsel for the respondent has relied on rule 8(4)(c) which runs as under :
'(c) If the applicant for declaration form ST-1 has at the time of making the application -
(i) defaulted in furnishing any returns or return together with (a) such other documents and statements required to be furnished along with the return and (b) the receipted challan or challans showing payment of tax due from him according to such return or returns, for the furnishing of which the prescribed date or dates or the extended date or dates, if any, have already expired; and
(ii) some adverse material has been formed by an officer appointed under sub-section (2) of section 9 suggesting any concealment of sale or purchase or of furnishing inaccurate particulars in the returns;
the appropriate assessing authority shall withhold for reasons to be recorded in writing the issue of declaration form ST-1 to him and shall make a report to the Commissioner about such withholding within a period of three days :
Provided that in a case falling under this clause the appropriate assessing authority may, instead of withholding declaration form ST-1 issue with the previous approval of the Assistant Commissioner, such forms in such numbers and subject to such conditions, and restrictions as it may consider reasonable to an applicant, if in its opinion it is desirable in the interest of the collection of sales tax to grant time to the applicant to pay up the arrears in one lump sum or by Installments :
Provided further that notwithstanding the provisions of any other rule, the issue of declaration form ST-1 to a dealer to whom a certificate of registration under the Act has been granted for the first time shall be withheld by the appropriate assessing authority until such time as all the returns for the return period commencing from the date of validity of the certificate of registration are furnishing and all arrears of tax according to such returns are paid by him.'
2. This power to withheld ST-1 forms requires a written order to be passed and is in addition to several other powers which the assessing authority has to withhold the forms, for instance, by clause (a) of sub-rule (4), if the declaration forms have been not used bona fide by the applicant or are not required bona fide, the appropriate authority can reject the application by passing a written order. If the security is not furnished in accordance with section 18(1), then also the application can be rejected.
3. Under clause (c) of sub-rule (4), there are two requirements. There must be a default in furnishing return and other documents, etc., and there must be some adverse material suggesting concealment of sale or furnishing of inaccurate particulars. In the present case, it appears that the forms have been refused on the ground that some enquiry is pending. We had directed by an interim order that the enquiry should be completed and ST-1 forms should be issued in the meantime. It appears that neither the enquiry has been concluded nor has the assessment of the assessed taken place. At this stage, it cannot be said that there has been any loss in revenue or any other action taken by the petitioner which would justify the withholding of the ST-1 forms. We would accordingly allow the petition and direct the respondent to issue the ST-1 forms as per the procedure prescribed by sub-rule (4) of rule 8. This by no means will stop or prevent the Sales Tax Officer or other assessing authority from passing any order in accordance with sub-rule (4).