Recorded reasons and statutory safeguards govern tax seizure; defective notices and noncompliance invalidate confiscation proceedings.

Sections 22(3), 22(4) and 22(6) of the Rajasthan Sales Tax Act were analysed as anti-evasion provisions with built-in safeguards: recorded reasons for seizure, inquiry in the prescribed manner, hearing before confiscation, and an option to pay in lieu of confiscation. On that basis, the provisions were held to be reasonable and not violative of Articles 14 or 19(1)(f) and (g). However, the seizure notice and the subsequent section 22(6) notice failed to record necessary reasons and did not comply with the statutory conditions, so the seizure, notices, and consequential confiscation action were invalid.

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Issues: (i) Whether sections 22(3), 22(4) and 22(6) of the Rajasthan Sales Tax Act, 1954 were unconstitutional as violative of Articles 14 and 19(1)(f) and (g) of the Constitution; (ii) whether the seizure of account books and goods, and the subsequent proceedings under section 22(6), were valid in the absence of proper recording of reasons and lawful compliance with the statutory requirements.

Issue (i): Whether sections 22(3), 22(4) and 22(6) of the Rajasthan Sales Tax Act, 1954 were unconstitutional as violative of Articles 14 and 19(1)(f) and (g) of the Constitution.

Analysis: The impugned provisions were enacted to prevent evasion of sales tax and to secure collection of lawful tax dues. Section 22(3) permits seizure only when the officer has reason to suspect evasion and requires reasons to be recorded in writing. Section 22(4) is ancillary to that power. Section 22(6) applies only to goods not accounted for in the dealer's books and, before confiscation, requires an opportunity of being heard, inquiry in the prescribed manner, and an option to pay in lieu of confiscation. These built-in safeguards, together with revisional supervision, were held to prevent arbitrariness and to make the restrictions reasonable in the public interest.

Conclusion: The provisions were upheld and were not found to infringe Articles 14 or 19(1)(f) and (g).

Issue (ii): Whether the seizure of account books and goods, and the subsequent proceedings under section 22(6), were valid in the absence of proper recording of reasons and lawful compliance with the statutory requirements.

Analysis: The notice for seizure merely stated that verbal or written information had come into the officer's possession and that the dealer was attempting to evade tax. It did not record the reasons for seizure as required by section 22(3), namely, why seizure was necessary for examination, inquiry, proceedings, or prosecution. The later notice under section 22(6) was also defective because it did not specify the tax payable before calling upon the dealer to pay an amount up to four times the tax in lieu of confiscation. The proceedings were hurried and did not reflect proper compliance with the statutory conditions.

Conclusion: The seizure and the notices were invalid, and the consequential action under section 22(6) could not stand.

Final Conclusion: The writ petition succeeded, the impugned notices were quashed, and the respondents were directed to return the seized goods.

Ratio Decidendi: A seizure or confiscation under a tax statute is valid only when the statutory preconditions are strictly satisfied, including recorded reasons where required and compliance with any safeguards governing opportunity of hearing and determination of the amount payable in lieu of confiscation.

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