Check-post detention power is limited to defective way-bill or actual tax evasion, not speculative future liability.

A check-post officer's power under Section 16-A of the Orissa Sales Tax Act, 1947 read with rule 94 is confined to the specified contingencies of no way-bill, a defective or incomplete way-bill, or actual evasion of tax. Where the way-bill was in order, with the consignor's signature and registration details present, detention of goods and demand for payment were not authorised. A speculative possibility of future tax liability did not amount to evasion at the point of interception, especially before any taxable sale had occurred in the State. The amount collected at the check-post was therefore without authority of law and refundable.

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Issues: Whether the officer-in-charge of a check-post could lawfully detain goods and demand payment when the way-bill was not in fact defective or incomplete and there was, at that stage, no tax evasion.

Analysis: Section 16-A of the Orissa Sales Tax Act, 1947, read with rule 94 of the Orissa Sales Tax Rules, 1947, confers power on the check-post officer to act in specified contingencies. The record showed that the defects mentioned in the notice did not actually exist, since the consignor's signature was present and the relevant registration numbers were available. The Court further held that the officer's power under rule 94(4)(a) is confined to cases where the goods are not covered by a way-bill, the way-bill is defective or incomplete, or there is actual evasion of tax in respect of the goods carried. Mere likelihood of future tax liability or a speculative apprehension that tax may later become payable does not amount to evasion at the point of interception. As the goods had only reached the check-post and no taxable sale had yet taken place in the State, there was no authority to demand the sums collected.

Conclusion: The demand and collection at the check-post were authority of law and had to be refunded.

Final Conclusion: The power of a check-post officer is limited to the contingencies expressly provided by the rules, and it cannot be used to exact tax-related payments merely on a conjecture of future evasion before any taxable event has occurred.

Ratio Decidendi: A check-post officer can detain goods or demand payment only when the goods are uncovered by a way-bill, the way-bill is defective or incomplete, or there is actual evasion of tax; a mere possibility of future evasion or future tax liability is insufficient.

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