Illegal detention of truck quashed; compensation ordered for loss at Rs. 5,000 per day for abuse of power

The HC quashed the confiscation orders against the petitioner's truck, holding that the continued detention without any valid order was illegal and arbitrary, violating natural justice. The court found the detention amounted to abuse of power causing harassment and financial loss. The respondents were directed to release the truck immediately and the Commissioner of Commercial Tax was ordered to assess and compensate the petitioner's loss at Rs. 5,000 per day from the date of detention, after hearing the petitioner, to be paid within one week. The petition was allowed.

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Issues Involved:
1. Legality of the detention and confiscation of the petitioner's truck.
2. Compliance with principles of natural justice.
3. Determination of financial loss due to illegal detention.
4. Compensation for arbitrary and unauthorized actions by public authorities.

Detailed Analysis:

1. Legality of the Detention and Confiscation of the Petitioner's Truck:
The petitioner, the owner of truck HR 55 S 1171, leased it to a transport company for a trip from Delhi to Vijayawada. During transit through Uttar Pradesh, the truck was detained by the Assistant Commissioner (Mobile Squad) for carrying goods beyond those covered by invoices. A detention order dated 14.10.2020 was issued, followed by proceedings under Section 130 of the CGST/UPGST Act, 2017 for confiscation. Despite the petitioner’s attempts to clarify the situation and request the truck's release, an order of confiscation was passed on 29.11.2020 without granting the petitioner a hearing.

2. Compliance with Principles of Natural Justice:
The court found that the show cause notice dated 23.12.2020 was misleading and incorrect, failing to provide the petitioner with a fair opportunity to respond. The notice's date for appearance was erroneously stated as 28.11.2020, causing confusion. The court emphasized that the principles of natural justice were not followed, as the petitioner was not given a proper opportunity to be heard, violating sub-section (4) of Section 130 of the Act. Consequently, the orders of confiscation and the appellate authority were quashed.

3. Determination of Financial Loss Due to Illegal Detention:
The court noted the petitioner's claim of financial loss due to the truck's detention since 14.10.2020, amounting to Rs. 5,000 per day. The court directed the Commissioner of Commercial Tax, U.P., Lucknow, to determine the financial loss within three weeks, after providing the petitioner an opportunity to be heard, and to compensate the petitioner accordingly within one week through an account payee bank draft.

4. Compensation for Arbitrary and Unauthorized Actions by Public Authorities:
The court highlighted that the continued detention of the truck without a valid confiscation order was arbitrary, illegal, and unauthorized, causing harassment to the petitioner. It underscored that public authorities acting maliciously or oppressively constitute an abuse of power. The court imposed a cost of Rs. 5,000 on the respondents for their arbitrary actions, to be deposited with the High Court Legal Services Committee, Allahabad. The court also ordered the immediate release of the truck.

Conclusion:
The writ petition was allowed with costs. The respondents were directed to release the truck immediately and compensate the petitioner for the financial loss incurred due to the illegal detention. The court's decision underscored the importance of adhering to principles of natural justice and the accountability of public authorities in exercising their powers.

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