Check-post detention for alleged undervaluation requires objective material; tax-endorsed transport documents cannot justify security demand.

Check-post detention of goods in transit cannot be sustained on alleged undervaluation alone when the delivery note and accompanying documents are in order and bear an endorsement showing tax payment by the assessing authority. The court reasoned that detention and insistence on security require cogent, objective material indicating illegality or tax evasion, and cannot rest on surmise, guess-work, or the officer's mere assertion. Where the record discloses no material supporting undervaluation and the transporter's objection is not properly considered, the detention notice and security-demand proceedings are illegal and unauthorised, and the goods must be released with refund of the security collected.

---

---

Issues: Whether the check-post authorities could detain the consignments and insist on security merely on the ground of alleged undervaluation, despite the delivery note carrying endorsement of tax payment by the assessing authority.

Analysis: The delivery note and accompanying documents showed the goods, the bill amount, the consignor and consignee, and an endorsement by the assessing authority acknowledging receipt of tax. In such circumstances, detention on the basis that the declared value was below the prevailing market rate could not rest on surmise or guess-work. The power under the check-post provisions had to be exercised on the basis of cogent material and not at the mere ipse dixit of the officer. The record did not disclose any material to justify the inference of undervaluation or suspected evasion, and the objection raised by the petitioner was not properly considered before demanding security.

Conclusion: The detention notice and the security-demand proceedings were illegal, unauthorised, and unfair, and the petitioner was entitled to release of the goods and refund of the security collected.

Final Conclusion: Check-post detention on alleged undervaluation cannot be sustained without objective material, particularly where tax payment is endorsed by the assessing authority and the transport documents are otherwise in order.

Ratio Decidendi: Check-post authorities may detain goods in transit only on the basis of objective material indicating illegality or tax evasion; alleged undervaluation, by itself and without cogent supporting material, cannot justify detention or demand of security when the transport documents and tax endorsement are in order.

---