Seizure of tax records upheld where written reasons showed suspected evasion, though failure to issue a receipt breached the statute.

Seizure of account books and documents under section 37(3) of the Bihar Sales Tax Act, 1959 is sustainable when the authority records written reasons showing a real suspicion of tax evasion and limits seizure to documents necessary for inspection or investigation. The recorded reasons must reflect application of mind, and a receipt for seized materials is a statutory safeguard that should be issued at the time of seizure. On the stated facts, the seizure was upheld because the reasons and basis for action were valid, but the failure to grant a receipt was treated as a breach warranting only limited relief, namely direction to issue the formal receipt.

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Issues: Whether seizure of account books and documents under section 37(3) of the Bihar Sales Tax Act, 1959 was valid when the authority had recorded reasons to suspect evasion of tax, and whether failure to grant a receipt vitiated the seizure.

Analysis: The power under section 37(3) requires the authority to have reason to suspect that a dealer is attempting to evade tax and to record the reasons in writing. Those reasons must disclose application of mind and must be sufficient to justify seizure of only such accounts, registers or documents as are necessary for inspection or investigation. The receipt contemplated by the provision is also a statutory safeguard and ought to be granted when the seizure is made. On the facts, the recorded reasons and the seizure were held to be validly supported, but the authority failed to grant the required receipt.

Conclusion: The seizure was not quashed for want of compliance with the first two requirements, but the omission to grant a receipt was a breach of section 37(3) requiring limited relief.

Final Conclusion: The writ petition succeeded only to the extent of directing issuance of a formal receipt for the seized documents, while the seizure itself otherwise stood.

Ratio Decidendi: Under section 37(3) of the Bihar Sales Tax Act, 1959, seizure is sustainable if the authority records reasons showing a real suspicion of tax evasion, and failure to grant a receipt does not in every case invalidate the entire seizure.

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