Cash security for coal import forms upheld as a lawful, non-arbitrary revenue-protective measure.

The Commissioner's power under Section 8C(3-A) of the U.P. Trade Tax Act to require cash security for notified goods was upheld because coal was a notified commodity, Form 31 was a prescribed declaration form, and the fixation was supported by relevant material on coal prices, freight, handling costs and inflation. The circular was not invalid for lacking a particular statutory form of general order, and the allegation of hostile discrimination failed because differential freight charges between rail and road transport did not establish material discrimination. The cash security enhancement was therefore treated as a lawful and reasonable revenue-protective measure within statutory power.

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Issues: Whether the circular fixing cash security at Rs. 150 per metric ton for issuance of Form 31 for import of coal under Section 8C(3-A) of the U.P. Trade Tax Act, 1948 was arbitrary, beyond jurisdiction, lacking reasonable nexus, or discriminatory.

Analysis: Section 8C(3-A) empowers the Commissioner, by a general order in writing, to require cash security in respect of notified goods for issuance of prescribed forms. Coal was a notified commodity and Form 31 was a prescribed declaration form. The earlier judicial decisions upheld the Commissioner's power under this provision and held that fixation of security is not invalid merely because it is based on market price, quality, inflationary changes, or an expert assessment, so long as the exercise is not arbitrary. The enhancement from Rs. 125 to Rs. 150 per metric ton was made after about one and a half years and was supported by material relating to coal prices, freight, loading and unloading costs, and inflationary increase. The plea that the circular was not a general order failed because the statute prescribes no particular form for such an order. The plea of hostile discrimination also failed because the alleged difference in freight charges between rail and road transport did not establish material discrimination.

Conclusion: The circular was valid and within the statutory power conferred by Section 8C(3-A); the challenge to the cash security fixation failed.

Final Conclusion: The petitions were not maintainable on merits, as the impugned security fixation was upheld as a lawful and reasonable revenue-protective measure.

Ratio Decidendi: Where a statute authorises the Commissioner to fix cash security by general order for notified goods, the fixation will be sustained if it is supported by relevant material, bears a rational nexus to revenue protection, and is not shown to be arbitrary or discriminatory.

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