Transit detention requires existing tax default on the date of interception; later assessment cannot justify the seizure.

Detention of a vehicle and goods in transit under Section 47(4) of the Kerala Value Added Tax Act was unlawful because the statutory precondition of an existing tax default was absent on the date of interception. The Court held that the officer could rely on the transit detention power only if the dealer was already shown to be in default or liable when the goods were detained; a later assessment order could not retrospectively validate the action. The detention was therefore set aside and release of the vehicle and goods was directed, while leaving the authorities free to proceed in accordance with law.

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Issues: Whether detention of the vehicle and goods under Section 47(4) of the Kerala Value Added Tax Act, 2003 was sustainable when no valid order showing tax default existed on the date of detention.

Analysis: Section 47(4) permits detention of goods in transit where the officer has reason to believe that tax on the goods under transport has not been paid, or that the dealer is in default of tax or other amounts due under the Act. The detention in question was founded on an order of assessment said to justify the action, but that order was passed only on the day after the detention. On the date of interception and detention, no valid order existed to show that the petitioner was a defaulter. The statutory power could not, therefore, be invoked on the basis of a subsequent order.

Conclusion: The detention was not sustainable in law and was set aside. Release of the vehicle and goods was directed.

Final Conclusion: The writ petition succeeded because the precondition for detention under the transit provision was absent on the date of action, though the authorities were left free to proceed under law if warranted.

Ratio Decidendi: Detention of goods in transit under Section 47(4) of the Kerala Value Added Tax Act, 2003 is valid only when the dealer's tax default or liability exists on the date of detention; a subsequent assessment or demand cannot retrospectively justify the detention.

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