Check-post detention cannot secure tax arrears without provisional attachment; transit form breaches still require notice and hearing before penalty.

Goods detained at a check-post could not be withheld merely to recover tax arrears in the absence of a specific provisional attachment order, so the remaining trucks were ordered to be released. For the alleged wrong transit form, the requirement to produce the correct form was upheld, but penalty under Section 68(5) had to be determined after notice, hearing and inquiry, with discretion to impose less than the statutory maximum. The trucks were directed to be released on deposit of the indicated amount, and the final penalty and tax liability were left to the competent authority in accordance with law.

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Issues: (i) Whether the department could insist on production of the correct transit form and require deposit of penalty for the alleged breach under Section 68(5) before releasing the detained trucks; (ii) Whether the department could detain the other trucks merely for recovery of tax arrears in the absence of a specific order of provisional attachment.

Issue (i): Whether the department could insist on production of the correct transit form and require deposit of penalty for the alleged breach under Section 68(5) before releasing the detained trucks.

Analysis: The requirement to produce the correct form was accepted as legitimate. For penalty, the governing provision contemplated notice, an opportunity of hearing, and inquiry before quantification. The maximum penalty under Section 68(5) was up to one and a half times the tax payable, leaving discretion to impose a lesser amount. In view of urgency, the petitioner was directed to deposit an amount approximating that maximum, while the competent authority was to decide the final penalty after considering the petitioner's representation.

Conclusion: The trucks detained for the wrong form were directed to be released upon deposit and representation, and the penalty was left to be determined by the competent authority in accordance with law.

Issue (ii): Whether the department could detain the other trucks merely for recovery of tax arrears in the absence of a specific order of provisional attachment.

Analysis: The Court found no prima facie power to detain goods of a dealer at the check-post merely to recover unpaid tax arrears unless supported by a specific provisional attachment order. The petitioner also undertook to discharge part of the admitted liability and to furnish the correct forms, but those further steps were not made a precondition to release.

Conclusion: The detention of the remaining trucks for recovery of tax arrears was not sustained, and their release was ordered.

Final Conclusion: The petition succeeded to the extent that all four trucks were ordered to be released, while the petitioner was required to deposit the indicated sums and face determination of the final penalty and tax liability in accordance with law.

Ratio Decidendi: Goods detained at a check-post cannot be withheld for tax recovery in the absence of a specific provisional attachment order, and penalty for a form-related breach must be determined after notice and hearing under the governing provision.

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