Case: Tripura Goods Transport Association and Another Vs. Commissioner of Taxes and Others

n which is doing the business of transporting goods within and outside the State of Tripura, is aggrieved by the judgment of the Gauhati High Court (Reported in) dismissing the writ appeal challenging the constitutional validity of the Tripura Sales Tax (11th Amendment) Rules, 1994 (for short, "the Rules") and sections 29, 32 and 36A of the Tripura Sales Tax Act, 1976 (for short, "the Act") including notifications dated September 23, 1994 and October 15, 1994. By means of the aforesaid 11th Amendment,e (3) has been inserted aftere (2) of rule46Aofa Sales Tax Rules, 1976 (for short, "the Principal Rules"),e (1A) has been inserted aftere 63A(1),e (2) in rule 63A has been substituted in placeofolde (2)ofthe principal Rules and rule 64A has been substituted for theoldrule 64A. The resultant effectofsuch amendment is that the appellants. Who are working as transporters in Tripura, are required to obtain a certificateofregistration and to comply with various other formalities as prescribed under the Act and the Rules, viz., to maintain accounts according to the prescription made by the respondents under section36Aofthe Act for carrying on transport business while entering into or going outside the StateofTripura including making the declaration in form XXIV, which is challenged to be beyond the legislative competenceofthe State Legislature and ultra vines the Constitutiong articles 14, 19(1)(g), 246, 265, 286, 300A and 301ofthe ConstitutionofIndia. The challenge is based on the ground that the appellants are transporters and are not dealers within the meaningofsection2(b)ofthe said Act, hence obligation cast on them under the Act and Rules are beyond the legislative competenceofthe State Legislature2. By a reasoned order, the learned single Judge was pleased to dismiss the writ petitionofthe appellants, except the challenge to the validityofrule 63A(2)ofthe principal Rules. However, the challenge made by the appellants regarding constitutional validityofsection 36A, which requires a carrier to maintain proper accountsofgoods transported to or outside Tripura in the manner prescribed, was not entertained by the learned single Judge. In appeal before the Division Bench, though foundation was laid but specific prayer for declarationofsection 36A as ultra vires was not made due to inadvertence, hence the appellants sought amendment to the prayer at the appellate stage which was granted, accordingly it was incorporated at the appellate stage. The Division Bench also dismissed the appealofthe appellants. Aggrieved by the same, the present appeal is filed.

Court's reasoning:
This provision is only to see that the correct statementoffacts are brought out. One is punished only if he knows or believes to be false, yet does not disclose it or even does not believe to be true, but still makes statement to the contrary. Under section 29(4) and section 30, thes in case committed by transporter are relatable to checkingofevasionoftax, then compositionofe under section 32 would also confine itself within this sphere. We do not find anyofthese provisions in any way placing any liability on the transporter which is otherwise on a dealer under this Act. Similarly, as aforesaid, the maintenanceofaccount by the transporters, carriers, etc., under section 36A is only to render help to the authorities in checking theevasionoftax. This does not put any such obligation on the transporter tod that theseprovisions transgress the legislative competenceofthe State LegislatureAs we havesaidthat theseinformations are required solely for the purpose for checking theevasionoftax. Next, we do not find any difficulty for any transporter to disclose the names and addressesofthe consignor and the consignee, the placeofdestination, he would also be knowing the descriptionofconsignment being transported its quantity, weight and value also from the description as disclosed by the consignor. The information, which the transporter has to give so far with reference to the quantity, weight and valueofthe goods, would be based on the basisofthe documents, paper, etc., as disclosed by the consignor. The fear expressed by the learned counsel for the appellants that in case such description, specially with reference to its weight or value, is found to be wrong about which he would never be certain as he has to depend on what is disclosed by the consignor, he would be liable for punishment under section 30. The fear expressed by learned counsel is without substance and is mere imaginary. We have already observed that thee is only drawn when there is false declaration, knowing the fact to be false, makes a declaration, not believing to be true yet makes declaration to the contrary. By making truthful declaration, believing the statement to be true based on informationofthe consignor, thee is not drawn unless there is connivance between the transporter and the consignorthe Haryana Act requires every clearing or forwarding agent, etc., transporting goods within the State who handles documentsoftitle to goods to be transported within the State for or on behalfofany dealer to furnish to the assessing authority such particulars and information as may be prescribed.n (2) debars all clearing or forwarding agents, etc., from carrying on their business unless they are licensed. It is held that a clearing, forwarding agent or dalal, etc., transporting goods within the State, even though may not be handling documentsoftitles to goods, is obliged to take a licence though he may not be liable to a penalty. Hence, it was held to be beyond the competenceofthe State Legislatureas it could not be in respectofany matter ancillary or subsidiary to the legislative entry which entitlesthe State Legislatureto impose such tax. This section further imposes a penalty equivalent to 20 per centofthe valueofgoods in respectofwhich no particulars and information have been furnished. But this decisions that such clearing or forwarding agent has to be within a reasonable and proximate connection between the transactionofsaleofsuch goods beforethe State Legislaturewould have competence to levy tax. The court held :"If a clearing or forwarding agent or dalal or person transporting goods is indeed reasonably and proximately connected with thesaleoccasioning the liability to thes tax, it is legitimate to require him to licence himself under the Act and maintain and furnish such information and particulars to the assessing authority thereunder as he would in the courseofhis business come to possess. It is legitimate then to make him liable for such escarpmentoftax as has resulted from the breach by himofsuch obligation and to a reasonable penalty....... However, inasmuch as thesaidAct does not define what precisely it means by the expression documentsoftitle to goods, it is unclear which classofforwarding or clearing agents or dalals or persons transporting goods it intends to bring within the ambit. To clearing and forwarding agents, dalals and other persons transporting goods who do not handle documentsoftitle to goods for or on behalfofany dealer, the provisionsofthesaidAct can have no application at all. In respectofsuch personsthe