S.K. Mal Lodha, J.
1. The Asstt. Commercial Taxes Officer, Ward A-l, Bhilwara (ACTO) filed an application under Section 15(2)(b) of the Rajasthan Sales Tax Act, 1954 (No. XXIX of 1954) ('the Act' here in), for directing the Board of Revenue for Rajasthan ('the Board') to state the case and refer the following question of law which is said to arise out of the appellate order dated April 16, 1979 to this Court which it has refused to do vide its . order dated October 16, 1979:
Whether in the facts and circumstances of the case penalty amounting to Rs. 1270/- Under Section 22(2) of the Rajasthan Sales Tax Act was not leviable as the unaccounted for goods were not seized?
2. On April 30, 1974 the Assessing Authority made an inspection and survey of the business premises of the dealer-respondent and found that goods of the value of Rs. 6,350/- were in possession of the dealer, which were not accounted for in his books of accounts. The Assessing Authority, therefore, gave a notice to the dealer-respondent to show cause why the unaccounted for goods be not seized under Section 22(6)(1) and why penalty at rate of 20% of the value of the goods which were not accounted for and which were found in his possession be not imposed upon him. In response to this notice an application was presented by the partner of the dealer-respondent that the unaccounted for goods of the value of Rs. 6,350/- may not be seized and that he was prepared to pay the penalty at rate of 20% of the value of unaccounted for goods found in his possession. The Assessing Authority (Commercial Taxes Officer) after hearing the dealer-respondent imposed a penalty of Rs. 1,270/-under Section 22(6) of the Act.
3. An appeal was filed before the Deputy Commissioner (Appeals) Commercial Taxes, Ajmer and he by his order dated February 3, 1977 set aside the penalty. Aggrieved by the aforesaid order the Assessing Authority filed a revision petition. A Single Member of the Board by his order dated August 4, 1978 relying on Bhonrilal Gopal Dass v. CTO 1974 KS 262: 1974 RRD 568 and CTO 'A' Circle v. M/s Thakurdas Khatri & Sons 1976 RRD 247 dismissed the revision petition holding that as the goods were not seized the penalty imposed by the Assessing Authority cannot be restored. A special appeal was filed against the aforesaid order dated August 4, 1978 passed by the Single Member of the Board. The Division Bench of the Board dismissed the special appeal holding that the imposition of penalty was not justified without actual seizure of the goods alleged to be unaccounted for in the books of accounts.
4. An application Under Section 15(1) of the Act was filed. That application was dismissed on October 16, 1979 observing that it is not necessary to make a reference to this Court on the point of law decided by it as it is covered by earlier decisions of the Board and that there is no ambiguity in the provisions of Section 22(6) of the Act what so ever. The Assessing Authority has filed this application Under Section 15(2)(b) of the Act as aforesaid.
5. This reference application Under Section 15(2)(b) of the Act is to be disposed of as a revision Under Section 15 of the Act as substituted by the Rajasthan Sales Tax (Amendment) Act, 1984 (No. XX of 1984) ('the Amendment Act') has come into force on May 1, 1985, for, Section 13(10) of the Amendment Act provides that every application for making reference to the High Court Under Section 15(2)(b) of the Act as it existed immediately before May 1, 1985 pending before the High Court on that date shall be deemed to be an application for revision Under Section 15 of the Act as substituted by the Amendment Act, and disposed of accordingly.
6. We have, therefore, heard it as a revision. The material part of Section 22(6) of the Act as it existed then is as follows:
22. Power of entry, inspection of records and seizure of books of accounts of a dealer
(1) xxxx xxxx xxxx(2) xxxx xxxx xxxx(3) xxxx xxxx xxxx(4) xxxx xxxx xxxx(5) xxxx xxxx xxxx(6) (a) Any such authority or persons shall have power to seize goods, the sale or purchase of which is liable to tax and which are found in the possession of a dealer in any office, shop, godown, vehicle, vessel or any other place of business, or building of the dealer, but not accounted for by the dealer in his accounts, registers, and other documents maintained in the course of his business, or in any other satisfactory manner.
Provided that a list of goods seized under this sub-section shall be prepared by such authority or person and signed by two respectable witnesses
(b) An officer not below the rank of an Assistant Commercial Taxes Officer, authorised under Sub-section (1), or the assessing authority may, after giving the dealer an opportunity of being heard and holding such further enquiry as he may consider fit, impose on him, for the possession of goods not accounted for (whether seized or not) (under) Clause (a), a penalty not exceeding 20% of the value of such goods, as may be determined by such officer or authority.
(c) Such officer or authority may release any goods seized under Clause (a) on payment of the penalty under Clause (b) or on furnishing such security for the payment there of as he may consider necessary.
7. The contention raised on behalf of the Assessing Authority by Mr. K.C. Bhandari is that the expression used in Section 22(6)(a) is 'power to seize' and, therefore, the actual seizure terms of Section 22(6) is not necessary before imposing the penalty. On the other hand, Mr. Dinesh Maheshwari, learned Counsel for the dealer-respondent pressed for our consideration that having regard to the object and scheme of Section 22 in general and that of Section 22(6) in particular, actual seizure of the goods found in the possession of the dealer and not accounted for in his books of accounts etc. and which are liable to tax under the Act and is necessary and this was the consistent view that, has been taken by the Board in the various cases. It is correct that in Section 22(6)(a) of the Act the expression 'shall seize any goods' has not been used and only 'power to seize any goods' has been used. But this difference, in our considered opinion, is not material because Under Section 22(6)(a) before imposing penalty these goods must be found in possession of the dealer and that too in the office, shop, godown, vehicle, vessel or any other place of business, or building of the dealer and not accounted for by the dealer in his account-books, register etc. Power to seize any goods used in Section 22(6)(a) refers to the actual seizure of the goods. This intention is clearly borne out from the proviso to Section 22(6)(a) which says that after seizure of the goods under Sub-section (a) of Section 22(6), a list of goods shall be prepared by the authority and it shall be signed by two respectable witnesses. Sub-section (c) of Section 22(6) further empowers the officer or authority to release the goods seized under Clause (a) of Section 22(6) of the Act on payment of the penalty under Clause (2) or on furnishing security for the payment as it may think proper in the circumstances of the case. The words 'whether seized or not' in Clause (b) of Section 22(6) were inserted w.e.f. January 2, 1976 by Ordinance No. 1 of 1976 which was replaced by Act No. IX of 1976. It was ruled in Manikam and Co. v. The State of Tamil Nadu 39 STC 12 by the Supreme Court that if an amendment is made which is by way of clarification of an earlier ambiguous provision it can be useful aid in construing the earlier provision even though such an amendment is not given retrospective effect. The Board in its decisions has taken note of this authority and on its basis construed that under the provisions of Section 22(6)(a) actual seizure is necessary. A division Bench of the Board in M/s Bhonri Lal Gopaldass's case 1974 KS 262: 1974 RRD 568 took the view that penalty Under Section 22(6) of the Act could only be imposed if the un-accounted for goods are seized and not otherwise. In support of this view the Division Bench has referred to the proviso to Section 22(6)(a) and 22(6)(b) of the Act. In CTO, 'A' Circle, Jaipur's case 1976 RRD 247 held that the amendment by way of insertion of the words 'whether seized or not' in Section 22(6)(b) of the Act shows that penalty could not be imposed when the goods are not seized and so the amendment enables to find out the intention of the legislature. It inferred that no penalty can be imposed unless the goods had actually been seized. In this view of the matter, the order setting aside the penalty imposed Under Section 22(6) was maintained.
8. M/s Thakurdas Khatri's case 1976 RRD 247 was followed in CTO, Spl. Circle-I, Jaipur v. M/s Rallis India Ltd. 1978 RRD 644 The observations were made there in that the amendment by way of insertion of the words 'whether seized or not' makes it abundantly clear that the Legislature Under Section 22(6)(a) envisaged actual seizure of the unaccounted for goods by using the expression power to seize. The question arose in ACTO (AE) v. M/s Mohanlal Sohanlal 1979 RRD 415 whether penalty could be imposed without seizure of the unaccounted for goods. The Division Bench of the Board opined that seizure of goods is an essential pre-requisite condition for imposition of penalty Under Section 22(6) of the Act. In that case, there was a voluntary offer or admission by the dealer. The earlier view taken in M/s Bhonrilal Gopal Dass's case 1974 KS 262: 1974 RRD 568, M/s Thakurdas Khatri's 1976 RRD 247 was followed. In these circumstances, it is clear that Board has taken a consistent view that penalty cannot be imposed Under Section 22(6) without actual seizure of the goods.
9. We have considered the reasons given by the Board in the light of the provisions of Section 22(6) and also the fact of amendment made in Section 22(6) by insertion of the word 'whether seized or not' in Section 22(6) of the Act. The Legislature seems to have intended that no penalty is to be imposed unless the goods are actually seized. Clauses (b) and (c) of Section 22(6) of the Act also lend support to it. In our opinion, the expression 'power to seize' used in Section 22(6) of the Act refers to the 'actual seizure' of the unaccounted for goods by the authority. Admittedly in the present case actual seizure has not taken place. Therefore, the imposition of penalty by the Assessing Authority was not justified, and the Deputy Commissioner (Appeals) as well as the Board in revision and special appeal were right in holding that actual seizure is necessary Under Section 22(6)(b) of the Act before imposing penalty. The view taken by the Board in the aforesaid decisions referred to above appears to us to be correct and for that matter the order dated April 16, 1979 passed by the Board dismissing the appeal against the order dated August 4, 1978 passed by the learned Member of the Board is correct. The reference application which has been heard and treated as revision Under Section 15 of the Act as substituted by the Rajasthan Sales Tax (Amendment) Act, 1984 is, therefore, dismissed, as in our opinion the question of law involved in this case has been correctly decided by the Board in its appellate order dated April, 16, 1979 and calls for no interference by this Court.
10. It is accordingly dismissed.
11. There will be no order as to costs.