TaxTMI 
TaxTMI 
2008 (9) TMI 915
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....he petitioner claims to be the sole proprietor is a registered dealer under the Assam General Sales Tax Act as well as the Central Sales Tax Act. The said firm is engaged in the business of pharmaceutical products with its registered office situated within the city of Guwahati. According to the petitioner, at about 12.30 pm. of June 31, 2001 a team of sales tax officials under the Deputy Commissioner of Taxes, Zone C, Guwahati, visited the business premises of the petitioner during his absence and issued a notice under section 44(1) of the Sales Tax Act requiring the employees present to produce the books of accounts of the firm for the years 1998-99 onwards for verification. Thereafter, according to the petitioner, the visiting team made a search of the business premises of the petitioner and effected seizure of certain documents which are specifically mentioned in the seizure list dated July 31, 2001 enclosed as annexure B to the writ petition. According to the petitioner, the aforesaid seizure was made on the ground that the petitioner, as the dealer, had been dealing in some taxable goods which are not covered by his registration certificate leading to evasion of taxes and addi....
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....ound in support of the seizure, as recorded in the seizure list dated July 31, 2001, is also not tenable as no loose sheets have been specifically mentioned in the seizure list prepared. The petitioner has further contended that the seized documents or photocopies thereof are required by the petitioner for the purpose of preparation of his books of accounts without which the petitioner is not in a position to produce such accounts before the concerned Sales Tax Officer. According to the petitioner, under the proviso to section 44(3) of the Sales Tax Act, retention of seized documents can be for a maximum period of 120 days whereafter the reasons for such retention has to be recorded and approved by the Commissioner of Taxes. In the present case, neither any such reasons have been recorded nor approval of the Commissioner has been obtained. That apart, according to the petitioner, the documents seized followed a search operation which, however, was not carried out in accordance with the provisions contained in the Code of Criminal Procedure, it is on the aforesaid broad basis that the petitioner seeks to challenge the seizure made; the retention of the seized documents beyond the....
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....y further retention has to be justified by recording of reasons which also has to be approved by the Commissioner of Taxes. In the present case, according to Sri Bhati, the order of approval dated February 11, 2002, passed by the Commissioner would go to show that such approval was sought by the Deputy Commissioner of Taxes, Zone C, Guwahati, only on January 28, 2002, i.e., after the expiry of 120 days. Consequently, the approval granted on February 11, 2002, by the Commissioner is also beyond the statutory period. Sri Bhati has specifically pointed out that the approval for retention beyond 120 days was sought for and accorded after the present writ petition was filed. According to Sri Bhati, on a reasonable reading of the proviso to section 44(3) of the Sales Tax Act it is clear that such approval should have been sought for and granted before the expiry of 120 days. As the provisions of the Sales Tax Act was not complied with, the retention of the seized documents, according to Sri Bhati, is wholly illegal thereby entitling the petitioner to forthwith receive the seized documents. In this regard reliance has been placed by Sri Bhati on a judgment of the apex court in Commissione....
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.... invalid. In this regard, Sri Dubey has also cited a judgment of the apex court in Life Insurance Corporation of India v. Escorts Ltd. reported in [1986] 59 Comp Cas 548 (SC); [1986] 1 SCC 264, to contend that the approval contemplated by the proviso to section 44(3) of the Sales Tax Act can very well be subsequent approval. Another decision of the apex court in U. P. Avas Evam Vikas Parishad v. Friends Coop. Housing Society Ltd. reported in [1995] Supp 3 SCC 456, has been relied upon to contend that the approval of the Commissioner once accorded, would relate back to the initial date and would validate the retention of the seized documents beyond 120 days though such approval may have been accorded after the expiry of the aforesaid 120 days. Before embarking upon a consideration of the rival projections made by the learned counsels, it may be necessary to notice the provisions contained in section 44(3) of the Sales Tax Act and section 132(8) and (10) of the Income-tax Act. 44. (3) If any authority appointed under sub-section (1) of section 3 has reason to suspect that any dealer is to evade the payment of any tax or any clearing or forwarding agent or a person transporting ....
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....s as it thinks fit." The striking difference in the language appearing in the relevant provisions of the two enactments brought about by the presence of a negative covenant in section 132(8) of the Income-tax Act and the absence thereof in section 44(3) of the Sales Tax Act, has already been noticed. In Commissioner of Income-tax v. Oriental Rubber Works [1984] 145 ITR 477 (SC), it was held that "two conditions must be fulfilled before such extended retention becomes permissible in law: '(a) reasons in writing must be recorded by the authorized officer or the concerned ITO seeking the Commissioner's approval, and (b) obtaining of the Commissioner's approval for such extended retention' and if either of these conditions is not fulfilled such extended retention will become unlawful and the concerned person, (i.e., the person from whose custody such books or documents have been seized or the person to whom those belong) acquires a right to the return of the same forthwith". However, the above view expressed must be understood to be in the context of the provisions of section 132(8) of the Income-tax Act. That apart, in the said case, the apex court also noticed the ....
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....India v. Escorts Ltd. [1986] 59 Comp Cas 548 (SC); [1986] 1 SCC 264 may be usefully noticed (pages 602-604): "61. From what has been narrated above, one of the principal questions to be considered is seen to be whether the Reserve Bank of India had the power or authority to give ex post facto permission under section 29(1)(b) of the Foreign Exchange Regulation Act for the purchase of shares in India by a company not incorporated in India or whether such permission had necessarily to be 'previous' permission. 62. We do not propose to refer to any dictionary to find out the meaning of the word 'permission', whether the word is comprehensive enough to include subsequent permission. We will only refer to what Sir Shah Sulaiman, Actg. C.J. said in Shakir Husain v. Chandoo Lal AIR 1931 All 567; [1931] ALJ 865: 'Ordinarily, the difference between approval and permission is that in the first, the act holds good until disapproved, while in the other case, it does not become effective until permission is obtained. But permission subsequently obtained may all the same validate the previous act.' 63. We have already extracted section 29(1) and we notice that....
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....ermission' to 'previous permission' only. In our view, what is necessary is that the permission of the Reserve Bank of India should be obtained at some stage for the purchase of shares by non-resident companies." In the present case, the court is concerned with the interpretation of a taxing statute. Without dilating, as the principles are well known, it will suffice to say that the interpretation of the court must be strict and without addition of words unless such addition is imperative to give a rational meaning to the provisions of the statute. When the Legislature has used the word "approval" in section 44(3) and the words "prior approval" finds mention in other provisions of the Sales Tax Act, i.e., section 28, it will not be correct on the part of the court to understand the approval contem plated by section 44(3) to be "prior approval". The use of the expression "prior approval" of the Commissioner for retention of the seized books of accounts documents, etc., in the proviso to section 74(3)(b) of the Assam Value Added Tax Act, 2003, is a further pointer to the legislative intent. In view of the above, it cannot be held that the approval granted by the Commis....