Bansal Sales Corp vs State Of J&K And Others

Rajesh Bindal, J

This order will dispose of a bunch of writ petitions and the appeals bearing OWP No. 9900002/1991, OWP Nos. 82, 525, 526 & 527/1992, LPAOW Nos. 214/1992 and 3/1993.

In OWP No. 9900002/1991 and OWP No. 82/1992, the petitioners have challenged the validity of Section 15-A of the Jammu and Kashmir General Sales Tax Act, 1962 besides detention of goods. Whereas in OWP Nos. 525, 526 & 527 of 1992 merely detention of goods is under challenge. In LPAOW No. 214/1992 filed by the appellant/writ petitioner, interim order passed in OWP No. 9900002/1991 is under challenge. In LPAOW No. 3/1993, the same interim order was challenged by the State.

At the time of hearing, learned counsel for the petitioners expressed their inability to address arguments on account of non-availability of the paper books. The plea cannot be accepted for the reason that the matter is pending consideration for the last about 30 years and has been shown in the cause list on number of occasions. Learned Advocate General was not certain about the status of the proceedings initiated against the petitioners.

A perusal of the interim order passed in OWP No. 9900002/1991 shows vires of Section 15-A of the J&K General Sales Tax Act, 1962 (for short, „the Act‟) is under challenge besides detention of goods. Notice in the petition was issued on January 01, 1992 and the seized goods were directed to be released on furnishing of bonds. Thereafter, vide detailed order passed on November 02, 1992, interim order passed earlier was modified. Considering the legal issue involved the matter was directed to be heard by the Division Bench. It is so recorded in the aforesaid order that the interim arrangement directed by this Court was in peculiar facts of the case in hand.

On November 07, 1992 this court passed the following order : "The matter in issue in present case is pending consideration in M/s Malik and Co. vs. State, which has been referred to and decided by a Full Bench. List this case also along with that writ petition". (sic)

None of the counsels present at the time of hearing apprised the Court about the details and the status of case, which has been referred to in the aforesaid order. The same is not even shown in the cause list. Nothing could be found out from Registry as well.

To some extent with similar facts, in OWP No. 82/1992, vires of Section 15-A of the Act is under challenge besides detention of goods. In this case as well vide order dated 19.02.1992, seized goods were directed to be released on furnishing of bonds and the case was directed to be heard along with aforesaid matter.

In OWP Nos. 525, 526 & 527/1992, vires of Section 15-A of the Act as such is not under challenge. Detention of goods is in dispute. The same were ordered to be released on deposit of the amount as directed in the order as a security with Additional Registrar of this Court.

It is also relevant to mention here that the Jammu and Kashmir General Sales Tax Act 1962 was replaced by the Jammu and Kashmir Value Added Tax Ordinance, 2005 (Ordinance No. 3 of 2005). Later on the Jammu and Kashmir Value Added Tax Act, 2005 was enacted (for short, „the 2005 Act‟). Still further with the enactment of the Jammu and Kashmir Goods and Services Tax Act, 2017, even the 2005 Act was also repealed. Meaning thereby the 1962 Act ceased to operate way back in the year 2005.

Section 15-A of the 1962 Act, the validity of which is under challenge in two petitions provides for establishment of check posts and inspection of goods in transit. The idea of establishment of such check posts is to check evasion of tax. It is settled law that enactment of provisions to check evasion of tax are within the legislative competence of the States under Entry 54 of List II of the Constitution of India. This being so, the provisions to make imposition of tax efficacious or to prevent evasion of tax, are within the legislative competence.

Further it may be added that validity of similar provisions, providing for establishment of check posts, inspection of goods in transit, under various taxing statutes, and levy of penalty have been upheld by Hon‟ble the Supreme Court. Reference can be made to AIR 1986 SC 1099 titled as M/s Sodhi Transport Corporation and others vs. State of U.P., (1990) 77 STC 170 (SC) titled as Delite Carriers (Regd.) vs. State of Haryana and others and (2002)1 SCC 279 titled as State of Rajasthan vs. D. P. Metals.

In view of the aforesaid developments, which have taken place during the pendency of the present petitions for the last about three decades and the settled position of law, nothing survives to adjudicate upon in present bunch of appeals and the writ petitions.

For the reasons mentioned above, nothing survives in the present bunch of appeals and the writ petitions. The same are accordingly dismissed. The proceedings, if pending before any authorities may be taken to their logical conclusion.