1998 (1) TMI 503

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....egation that since the petitioner had failed to furnish the additional security of Rs. 2,00,000 demanded from the petitioner, therefore, the registrations were being cancelled. 4.. The petitioner is a firm which carries on business, inter alia, in iron and steel building materials and stone grits, etc. At the time when registration was obtained both under the U.P. Trade Tax Act and the Central Sales Tax Act the petitioner was required to give a bank guarantee of Rs. 15,000 which was admittedly furnished. A notice purporting to be under section 8-C of the U.P. Trade Tax Act was served upon the petitioner demanding additional security of Rs. 2,00,000 by January 30, 1996, failing which the notice stated that proceedings for the cancellation....

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....ancelled under the U.P. Trade Tax Act and the Central Sales Tax Act on the allegation that the petitioner did not appear on the date fixed in the show cause notice and the additional security of rupees two lacs was not furnished.   It is averred in the counter-affidavit that the interim order passed by this Court was not placed before the respondent although the case of the petitioner is that the said order was duly brought to the notice of the respondent and he proceeded to pass the impugned order in violation of the interim order. 6.. Sub-section (2) of section 8-C contemplates as under: "(2) Where it appears necessary to the assessing authority so to do- (a) for the proper realisation of any tax, penalty or other sums du....

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....with the estimate of the assessing authority, on the turnover of the dealer for the assessment year in which such security is required to be furnished. 8.. It is pertinent to observe that notice issued under sub-section (2) of section 8-C dated January 19, 1996, straightaway required the petitioner to give additional security of Rs. 2,00,000 without requiring the petitioner to show cause as contemplated in sub-section (3) of section 8-C. The notice also as observed earlier does not disclose any reason on account of which the petitioner was called upon to furnish the additional security. However, as stated earlier, the petitioner had objected to the demand of additional security and thus it was incumbent on the part of the respondent to p....