Check-post detention requires tangible basis; disputed classification issues must be left to the assessing authority.

The HC stated that a check-post officer's power to detain goods is limited to preventing clandestine tax evasion and cannot be exercised on mere presumption or surmise. Where the transporter is a registered dealer and the registration particulars are disclosed, detention requires tangible material supporting a belief that tax is likely to be evaded. Disputed questions about the nature of the goods and coverage under the dealer's registration cannot be conclusively decided at the check-post stage on scanty material, because scrutiny of way-bills is distinct from assessment. The demand and detention order was therefore set aside.

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Issues: Whether the check-post officer could detain the goods and demand tax by adjudicating, on a summary scrutiny of the way-bill, that the article transported was not covered by the dealer's registration and that there was possibility of evasion of tax.

Analysis: The power exercised at a check-post is meant to prevent clandestine evasion, but it cannot rest on mere presumption or surmise. Where the transporter is a registered dealer and the relevant registration particulars are disclosed, detention of goods requires some tangible basis for a belief that tax is likely to be evaded. The nature of the article purchased and other controversial questions cannot be conclusively decided at the check-post stage on scanty material, because scrutiny of way-bills is conceptually distinct from assessment. Such disputed matters are to be examined by the assessing authority having jurisdiction over the registered dealer.

Conclusion: The demand and detention order could not be sustained and was set aside in favour of the petitioner.

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