Directory time-limit under sales tax detention proceedings does not cause abatement on expiry of fourteen days.

A fourteen-day time-limit for deciding proceedings under section 14B(7)(ii) and (iii) of the Punjab General Sales Tax Act, 1948 was held to be directory, not mandatory. The Court applied the settled test of legislative intent, the statutory scheme, the object of preventing tax evasion during transit, and the consequences of non-compliance, and found that the time prescription was procedural. Expiry of the period did not create a substantive right for the assessee or cause automatic abatement of the proceedings, which still depended on notice, hearing, and compliance with natural justice.

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Issues: Whether the time-limit of fourteen days for deciding proceedings under section 14B(7)(ii) and (iii) of the Punjab General Sales Tax Act, 1948 is mandatory or directory, and whether failure to decide within that period results in abatement of the proceedings.

Analysis: The statutory scheme permitted detention of goods with provision for release on security and required the enquiry officer to complete the adjudicatory process expeditiously. The time-limit was intended to prevent undue delay and facilitate prompt disposal, but the provision did not create a substantive right in favour of the assessee that the proceedings would automatically lapse on expiry of fourteen days. The object of the legislation was to check evasion of tax during transit, and the adjudication depended on factors such as notice, hearing, and compliance with natural justice. Applying the settled test that the legislative intent, scheme, object, and consequences of non-compliance determine whether a provision is mandatory or directory, the time prescription was held to be procedural rather than fatal to jurisdiction.

Conclusion: The provisions of section 14B(7)(ii) and (iii) are directory, not mandatory, and expiry of the prescribed period does not abate the proceedings.

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