Taxability of seized goods must be decided in assessment, not in a seizure proceeding for release security.

Taxability of makka poha could not be conclusively decided in a seizure or release-security proceeding under section 48(7) of the Uttar Pradesh Value Added Tax Act; that issue remained for determination by the assessing authority in regular assessment. Because the dealer was registered and no final finding on classification was required at the seizure stage, the demand for security for release of the goods was not sustained on that ground alone. The revision was dismissed, but the question whether the goods were taxable or exempt was left open for decision in appropriate proceedings.

---

---

Issues: Whether the seizure of goods and demand of security for release of the goods were justified when the taxability of the goods was yet to be determined in assessment proceedings.

Analysis: The controversy concerned makka poha, which the Department treated as an unclassified taxable item and the dealer claimed to be exempt as kachri. The question whether the goods were taxable was held to be a matter for the assessing authority in the regular assessment proceeding, not for decision in an ancillary or incidental proceeding under section 48(7) of the Uttar Pradesh Value Added Tax Act. As the dealer was a registered dealer and no final finding on taxability was required at the seizure stage, there was no basis to interfere with the earlier view that seizure and security demand could not be sustained on that issue alone.

Conclusion: The revision was dismissed, and the seizure dispute did not conclude that makka poha was taxable or non-taxable; that question was left open for determination in appropriate proceedings.

---