AI Drafter 
TaxTMI 
TaxTMI 
1995 (7) TMI 399
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....ers, which we shall deal separately, the short but the prime common question requiring consideration is whether a person is liable to be arrested and detained for a total period of 15 days, prescribed in section 138 of the Land Reforms Act, in relation to the demand in a recovery certificate, being the total demand created on account of various assessments separately made or can such a person be detained separately for a period of 15 days for each of the demands for different assessment years for which a joint or separate/several recovery certificates are issued by the assessing authority for recovery as arrears of land revenue. 3.. To appreciate the controversy involved and the rival contentions, we may briefly refer to the facts in Criminal Writ Petition No. 134 of 1992-Harmeet Singh Ghai v. Anand S. Khullar, which was treated as the main case. 4.. The petitioner, who was running his business under the name and style of "Reliance Enterprises" as a proprietary concern, was a registered dealer under the local Sales Tax Act and the Central Sales Tax Act. The assessments for the years 1978-79 to 1985-86 were framed under section 23 of the local Act, which resulted in an ....
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....pondents, the Commissioner of Sales Tax, New Delhi, has also been impleaded as respondent No. 3. 5.. In response to show cause notice, an answer was filed on behalf of the respondents and the petition is resisted. It is explained that on receipt of recovery certificates from the Sales Tax Officer in respect of aforementioned assessment years in form ST-17, respondent No. 1 issued various notices and warrants to the petitioner but there being no response, warrants of his arrest were issued. Initially, the warrant of detention was issued by respondent No. 1 on 22nd February, 1992, under section 138 of the Land Reforms Act, in his capacity as Collector of Sales Tax, for detention of the petitioner up to 7th March, 1992, on which date he was required to be produced before respondent No. 1; the petitioner being in the hospital, was not produced before respondent No. 1 and the date of his production was extended first up to 9th March, 1992 and thereafter to 20th March, 1992. However, on 9th March, 1992, another warrant of detention was issued by respondent No. 1, directing petitioner's detention in civil prison up to 20th March, 1992. The said two warrants of detention placed on recor....
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....eof provides that if the amount of tax or penalty is not paid within time specified under sub-section (1) or extended under sub-section (2), the dealer will be deemed to be a defaulter in respect of that amount. Sub-section (7) of the section lays down that "any amount of tax or penalty in respect of which a dealer or person is in default......shall be recoverable as an arrear of land revenue." 8.. Section 70 of the local Act attracts the application of the provisions of the Land Reforms Act for the purpose of sales tax recoverable as arrears of land revenue and lays down that for recovery of any amount recoverable as arrear of land revenue under the Act, the provisions of the said Act shall, "notwithstanding anything contained in that Act or in any other enactment, be deemed to be in force throughout Delhi and the provisions of the Revenue Recovery Act, 1890, shall have effect accordingly". 9.. For carrying out the purpose of the Act, the Delhi Sales Tax Rules, 1975, have been framed under section 71 of the Local Act which, inter alia, prescribes procedure for recovery of the Government dues. Sub-rule (3) of rule 27, falling in Chapter V, dealing with recovery proceedings la....
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....eals with "arrest and detention", rule 119 whereof sets out the procedure for it, which reads as follows: "119. Procedure.-(1) Whenever the Tehsildar causes a defaulter to be arrested, he shall without delay report the fact for the information of the Deputy Commissioner and the Revenue Assistant; (2) After arrest, a defaulter shall be brought without delay before the officer who issued the warrant and shall not be detained in custody unless there is reason to believe that the process of detention will compel the payment of the whole or a substantial portion of the arrears. If an order for detention is passed, it shall specify the date on which the detention will cease if the arrear is not sooner paid; (3) If the officer who issued the warrant sees fit, when the defaulter is produced before him, to give him further time, to pay the arrears, instead of detaining him, he may release the defaulter on his undertaking to pay the arrear within the period fixed. Should it become necessary to arrest the defaulter again, fresh warrant in L.R. form 29 shall invariably be issued, and a separate fee levied. When a warrant has been once executed by the arrest of defaulter, the same warr....
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....lter. This, in our view, is the condition precedent for ordering the detention of the defaulter. 13.. We are fortified in our view by the pronouncement of the Supreme Court in Collector of Malabar v. Erimmal Ebrahim Hajee [1957] 32 ITR 125 and in Ram Narayan Agarwal v. State of Uttar Pradesh [1983] 54 STC 273. In the last mentioned case section 281 of the U.P. Zamindari Abolition and Land Reforms Act, 1950 and rule 251 of the U.P. Zamindari Abolition and Land Reforms Rules, 1952, which are in pari materia to section 138 of the Land Reforms Act and rule 119 of the Land Reforms Rules respectively, came up for consideration. In the same judgment the Supreme Court also observed that a writ of demand or citation should ordinarily be issued to the defaulter before resorting to the drastic process of issuing an arrest warrant and even if a formal writ of demand is not issued, it is implicit in the nature of the process to be issued for arrest that the defaulter concerned should have prior notice of the issue of the certificate for recovery to enable him to pay up the amount demanded to avoid arrest. 14.. On the same analogy we feel that in the process of determining and satisfyin....
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....assessment year, each year is independent and a dealer can be in default for one or more years and that if a dealer is deemed to be in default on his failure to pay tax or penalty within the time specified in section 25(1) or (2) of the local Sales Tax Act, recourse can be had to subsection (7) of section 25 to recover the same as an arrear of land revenue for which a recovery certificate can be issued to the Collector in form No. ST-17 in respect of that particular year and the Collector can, on receipt of such a certificate, proceed to effect recovery immediately thereafter. For subsequent assessment year, a fresh recovery certificate may be issued and there may be as many recovery certificates in form No. ST-17 as many are the notices of demand in form No. ST-16. On each of the recovery certificates so issued, the Collector may legitimately start fresh recovery proceedings under section 138 of the Act. But if the certificate issued in form No. ST-17 is for a consolidated demand for a number of years, the Collector acting thereon cannot detain a defaulter for a period exceeding 15 days stipulated as maximum in section 138. 18.. One basic thing to be kept in mind, and as it wou....
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.... With reference to the provisions of sub-section (7) of section 25 of the Delhi Sales Tax Act, 1975 and rule 27 made thereunder you are hereby requested to recover the said sums as if it were an arrear of land revenue. The amount recovered may please be credited in the appropriate Government treasury in the Consolidated Fund of India (Delhi) under Head '040 Sales Tax Receipts-State Sales Tax Receipts'. 3. In addition to the amount specified in the certificate aforesaid, interest chargeable under sub-section (2) of section 27 from the date of this certificate till realisation is also recoverable as an arrear of land revenue and may be recovered accordingly. 19.. We are, therefore, of the view that the recovery certificate, on which the writ of demand and the warrant of arrest is to be issued and the question of issuance of detention order is to be determined, is in relation to entire demand due from a defaulter at the time of its issue irrespective of the assessment year/s to which it pertained. Support is also lent to this view by sub-rule (2) of rule 108 of the Land Reforms Rules, laying down (in case of arrears of land revenue of land-which also is recoverable as an ....
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....etc., but section 70 of the local Act, which is a later Act, contains a non obstante clause and lays down that notwithstanding anything contained in the Land Reforms Act, it would be deemed to be in force throughout Delhi for the recovery of any amount recoverable as arrear of land revenue under the local Act. 22.. We may now examine the validity of the respondents action in arresting and detaining each of the petitioners for different periods, in the light of the aforesaid legal position. Crl. Writ Petition No. 134 of 1992 (Harmeet Singh Ghai v. A.S. Khullar) 23. The facts of this case have already been narrated above in extenso as illustrative. The case involves both the issues which have been discussed above, viz., the period of detention and the mandatory procedural requirements to be complied with before actually detaining a defaulter. Although recovery certificate issued in form No. ST-17 has not been placed before us but from the warrant of detention dated 22nd February, 1992, it is clear that the warrant was issued for the recovery of Rs. 3,59,28,581, which indisputably was the arrear of tax pertaining to the years 1978-79 to 1986-87, in respect of wh....