Confiscation under sales tax law must follow lawful seizure by the seizing officer; substitution by another officer is invalid.
Section 28(6) of the Andhra Pradesh General Sales Tax Act required confiscation to be pursued by the officer who lawfully seized the goods after hearing and enquiry; a Deputy Commissioner could not substitute himself for the seizing officer without express authority, so the confiscation order was without jurisdiction. The completed assessments, which accepted the disputed transaction and did not levy tax on that basis, also undermined the basis for confiscation proceedings founded on alleged clandestine trade. The writ petition was allowed, the confiscation order was quashed, and the security furnished was directed to be returned.
Issues: (i) Whether an order of confiscation under section 28(6) of the Andhra Pradesh General Sales Tax Act could be passed by the Deputy Commissioner when the goods had been seized by another officer. (ii) Whether the completed assessments, accepting the disputed transaction and not levying tax on that basis, affected the propriety of confiscation proceedings.
Issue (i): Whether an order of confiscation under section 28(6) of the Andhra Pradesh General Sales Tax Act could be passed by the Deputy Commissioner when the goods had been seized by another officer.
Analysis: The provision empowered the officer who seized the goods to proceed with confiscation after giving the affected person an opportunity of being heard and making the prescribed enquiry. The statutory scheme did not authorise one officer to take over seizure proceedings initiated by another and to pass the confiscation order in substitution of the seizing officer. In the absence of an express enabling provision, the Deputy Commissioner lacked competence to make the confiscation order.
Conclusion: The confiscation order was without jurisdiction and could not stand.
Issue (ii): Whether the completed assessments, accepting the disputed transaction and not levying tax on that basis, affected the propriety of confiscation proceedings.
Analysis: The assessments for the relevant years had been finalised on the footing that the disputed purchase was duly accounted for and that tax had already been paid at the first purchase point. In that setting, the attempt to proceed with confiscation on the footing of clandestine trade was inconsistent with the accepted assessment position and lacked proper basis.
Conclusion: The confiscation proceedings were not proper in view of the completed assessments.
Final Conclusion: The writ petition succeeded, the confiscation order was quashed, and the security furnished by the petitioner was directed to be returned.
Ratio Decidendi: Under section 28(6) of the Andhra Pradesh General Sales Tax Act, confiscation must be undertaken by the officer who lawfully initiated the seizure proceedings, and an order passed by an lacking such statutory competence is invalid.
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