Detention of goods for defective documents may be lifted on tax payment, while compounding fee disputes go to appeal.

Detained goods were considered for release on payment of the tax component where the accompanying documents were found defective and offence provisions under the Tamil Nadu Value Added Tax Act, 2006 were invoked. The Court noted that similar matters had been directed to be released on payment of tax, and since the tax component had already been determined, interference with detention was not warranted on the facts presented. The dispute over the compounding fee was not finally decided and was left to be pursued before the statutory appellate authority.

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Issues: Whether the detained goods were to be released on payment of the tax component and whether the challenge to the compounding fee should be pursued before the appellate authority.

Analysis: The goods were detained on the ground that the accompanying documents were defective and the authorities invoked the provisions relating to offences under the Tamil Nadu Value Added Tax Act, 2006. The Court noted that, in similar matters, release had been directed on payment of the tax component, and in the present case the tax component had already been determined. In that situation, interference with the detention was not warranted on the facts placed before the Court, while the dispute regarding the compounding fee was left open to be pursued in the statutory appellate forum.

Conclusion: The petitioner was required to pay the tax component for release of the goods, and the challenge to the compounding fee was left to be worked out before the appellate authority.

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