Chapter V Chapter V

MAINTENANCE OF ACCOUNTS, INSPECTION OF BUSINESS PREMISES AND ACCOUNTS AND ESTABLISHMENT OF CHECK-POSTS

1. (1) Every registered dealer or other dealer on whom a notice has been served to furnish returns shall keep a true account of his business and if the assessing authority considers that such account is not sufficiently clear and intelligible to enable him to make a proper check of the returns furnished by him, he may require such dealer by notice in writing to keep such accounts as he may, subject to anything that may be prescribed in that behalf, in writing, direct.
2. (2) Every dealer liable to pay tax or other dealer on whom a notice has been served to furnish returns shall-
   • (a) in respect of tobacco supplied by him or on his behalf in any one transaction exceeding one hundred rupees in value or such other higher value, as the Government may, by notification, specify, issue to the recipient of tobacco an invoice showing such particulars as may be prescribed;
   • (b) preserve a carbon copy of such invoice, cash memorandum or bill for a period of not less than five years from the end of year in which the cash memorandum or bill is prepared or for a period of not less than three years from the date of the final assessment order for that year, whichever is later:

Power to record statement The Commissioner or any person appointed to assist him under sub-section

1. (1) of section 3, shall have the statement of any person connected with the business during the course of inspection or checking and to use the same for the purpose of determining the liability of the dealer under this Act.

-1 11. Production and inspection of books, documents and accounts.

1. (1) The Commissioner or any person appointed to assist him under sub-section
2. (1) of section 3 not below the rank of an Assistant Excise and Taxation Officer may, for the purpose of this Act, require any dealer to produce before him any book, document or account relating to his business and may inspect, examine and copy the same and make such enquiries from such dealer relating to his business, as may be necessary: Provided that the books, documents and accounts of a period of more than five years prior to the year in which assessment is made shall not be so required except in cases where some proceedings under this Act are pending.
3. (2) Every registered dealer shall-
   • (a) maintain day to day accounts of his business;
   • (b) maintain a list of his account books, display it along with his registration certificate and furnish a copy of such list to the assessing authority;
   • (c) Produce, if so required, account books of his business before the assessing authority for authentication in the prescribed manner;
   • (d) Retain his account books at the place of his business, unless removed there from by an official for inspection, by any official agency or by auditor or for any other reason which may be considered to be satisfactory by the assessing authority.
4. (3) If any officer referred to in sub-section
5. (1) has reasonable grounds for believing that any dealer is trying to evade liability for tax or other dues under this Act and that anything necessary for the purpose of an investigation into his liability may be found in any books, account, register or document, he may, seize the book, account, register or document shall forthwith grant a receipt for the same and shall,-
   • (a) in the case of book, account, register or document which was being used at the time of seizing, within a period of sixty days from the date of seizure; and
   • (b) in any other case, within a period one hundred eighty days from the date of seizure; return it to the dealer or the person from whose custody it was seized after examination or after having such copies or extracts taken there from as may be considered necessary: Provided that the dealer or the aforesaid person gives a receipt in writing for the book, account, register or document returned to him, such officer may, before returning the book, account, register or document affix his signatures and his official seal at one or more places thereon, and in such case, the dealer of the aforesaid person will be required to mention in the receipt given by him the number of places where the signatures and seal of such officer have been affixed on each book, accounts, register or document: Provided further that the seized book, account, register or document may be retained for a longer period if so required: Provided further that if the seized book, account, register or document may be retained for a longer period if so required: Provided further that if the seized book, account, register or document is retained by any authority either than the Commissioner for more than the aforesaid period, the reasons for doing so shall be recorded in writing and the approval of the Commissioner obtained by the authority so retaining them.
6. (4) For the purposes of sub-section
7. (2) or sub-section (3), the officer, referred to in sub-section (1), assisted by such person as he may consider necessary, may enter and search any office, shop, go down, goods carrier or any other place of business of the dealer or any building, dwelling house or place where such officer, has reasons to believe that the dealer uses, or is, for the time being, using, for the purpose of business or keeps, or is, for the time being, keeping, any books, accounts, registers, documents or tobacco relating to his business: Provided that no entry or search in a dwelling house shall be made-
   • (i) after sun-set and before sun-rise;
   • (ii) by an officer below the rank of an Excise and Taxation Officer:
   • (iii) without obtaining the sanction of the Deputy Commissioner or Sub-Divisional Officer (Civil) within whose jurisdiction such house is situated.
8. (5) The power conferred by sub-section
9. (4) shall include the power,-
   • (i) to search the person or the dealer and his agent and employees present at the time of inspection and to open and search any box or to receptacle in which any books, accounts, registers or other relevant documents or tobacco or cash or the cash receipts of the dealer may be contained; and
   • (ii) to make a note of inventory of any such cash or tobacco found as a result of such search.
10. (6) Any officer referred to in sub-section
11. (1) shall have the power to impose a penalty between twenty and forty percent of the value of the tobacco which is found in any office shop, go down, or any other place of business or any building or place of the dealer or vessel or goods carrier but not accounted for by the dealer or the person incharge of the vessel or goods carrier in his books, account, registers and other documents; Provided that no penalty shall be imposed unless the person concerned has been given a reasonable opportunity of being heard,
12. (7) The officer imposing the penalty under sub-section
13. (6) shall direct the person concerned to pay the amount of penalty within such time and manner as may be prescribed. He may, in the case of failure of the person concerned to pay the penalty as directed, require him to furnish an adequate security to his satisfaction in the manner prescribed to ensure the payment of the penalty and in case such person fails to furnish the security, the amount of penalty shall immediately become payable and shall be recovered as arrears of land revenue.

1. (1) If with a view to preventing or checking evasion of tax under this Act in any place or places in the State, the Government, considers it necessary so to do, it may, by notification, direct the establishment of a check-post or the erection of barrier or both, at such place or places, as may be notified.
2. (2) The owner or person incharge of the tobacco and when the tobacco is carried by a goods carrier, the driver or any other person incharge of the goods carrier shall carry with him a goods carrier record, a trip sheet or log-book, along with a challan, as may be prescribed and invoice in respect of the tobacco meant for the purposes of supply and are carried by him in the goods carrier and produce the same before an officer incharge of a check-post or barrier or any other officer of the department not below the rank of an Assistant Excise and Taxation Officer or such other officer, as the Government may, by notification, appoint, for checking the goods carrier at any other place.
3. (3) At every check post or barrier or at any other place when so required by any officer referred to in sub-section
4. (2) in this behalf, the owner or person incharge of the tobacco shall stop and the driver or any other person incharge of the goods carrier, entering or leaving the limits of the State, shall stop the goods carrier and keep it stationary, as long as may reasonably be necessary, and allow the officer incharge of the check-post or barrier or the officer as aforesaid to examine the tobacco carried by him or in the goods carrier, by breaking open the package, or packages, if necessary, and inspect all records relating to the tobacco carried which are in the possession of such owner or person incharge of the tobacco or the driver or other person incharge of the goods carrier, who shall also furnish such other information, as may be required by the aforesaid officer, who if considered necessary may also search the goods carrier and the driver or other person incharge of the goods carrier or of the tobacco.
5. (4) The owner or person incharge of the tobacco or goods carrier, entering or leaving the limits of the state shall furnish a copy of goods receipt, documents as referred to in sub-section (2), or a declaration containing such particulars in such form obtained from such authority, in the manner as may be prescribed, of the tobacco carried by him or in such carrier, as the case may be, before the officer-in-charge of the check-post or barrier and shall produce the copy of the said goods receipt, documents, or declaration duly verified and returned to him by the officer-in-charge of the check-post or barrier before any other officer as mentioned in sub-section (2): Provided that where the owner or person incharge of the tobacco or the driver or other person incharge of the goods carrier bound for any place outside the State passes through the State, such owner or person incharge of the tobacco or the driver or other person incharge of such carrier shall, in the prescribed manner, furnish, in duplicate, to the Officer-in-charge of the check-post or barrier of his entry into the State a declaration in the prescribed form and obtain from him a copy thereof duly verified. The owner or person incharge of the tobacco carried or the driver or other person incharge of the goods carrier shall deliver within twenty-four hours the said copy to the officer-in-charge of the check-post or barrier at the point of his exit from the State, failing which he shall be liable to pay a penalty, to be imposed by the Officer-in-charge of the check-post or barrier of the entry, not exceeding two thousand rupees or twenty per centum of the value of the tobacco, which is greater: Provided further that no penalty shall be imposed unless the person concerned has been given a reasonable opportunity of being heard: Provided further that where the owner or person incharge of the tobacco or the driver or other person incharge of the goods carrier bound, from a place inside the State to any other place inside the State, has to pass through another State, such owner or person or the driver or other person shall furnish, in duplicate to the officer-incharge of the check-post or barrier of his exit from the State, a declaration in the prescribed form and obtain from him a copy thereof duly verified and shall deliver the same to the Officer-in-charge of the check-post or barrier of his entry into the State within twenty-four hours of his exit from the previous barrier or check-post in the State, failing which he shall be liable to pay a penalty to be imposed by the officer-in-charge of the check-post or barrier of his exit, not exceeding two thousand rupees or forty per-centum of the value of the tobacco, which ever is greater, unless he explains the time taken in excess to the satisfaction of the officer-in-charge of the exit barrier or check-post.
6. (5) If the officer in-charge of the check-post or barrier or other officer as mentioned in sub-section
7. (2) has reasons to suspect that the tobacco under transport is not covered by proper and genuine documents as mentioned in sub-section
8. (2) or sub-section (4), as the case may be, or that the person transporting the tobacco is attempting to evade payment of the tax due under this Act, he may, for reasons to be recorded in writing, and after hearing the said person, order the unloading and detention of the tobacco, and shall allow the same to be transported only on the owner of tobacco or his representative or the driver or other person incharge of the goods carrier on behalf of the owner of the tobacco furnishing to his satisfaction a security, in the prescribed form and manner, for an amount between twenty and forty per centum of the value of tobacco: Provided that such officer may, if he deems fit, having regard to the nature of the carrier or the tobacco and other relevant matters, allow such tobacco to be transported, on the owner of the tobacco or his representative or the driver or other person incharge of the goods carrier, executing in a prescribed manner, a bond with or without sureties for securing the amount due as security: Provided further that such officer may, if he deems fit, having regard to the nature of the tobacco and the goods carrier, and other relevant matters, handover the tobacco on superdari to any person for safe custody, on payment of such charges for the custody, as may be prescribed which shall be recovered from the owner of the tobacco. The person to whom the tobacco is handed over on superdari shall not hand over the same to anybody except with the written permission of such officer otherwise the value of the tobacco shall be recoverable as arrears of land revenue from him: Provided further that where any tobacco is detained, a report shall be made immediately and in any case within twenty-four hours of the detention of the tobacco by the officer detaining the tobacco to the officer incharge of the district seeking the letter’s permission for the detention of the tobacco for a period exceeding twenty-four hours as and when so required and if no intimation to the contrary is received from the latter, the former may assume that his proposal has been accepted.
9. (6) The officer detaining the goods shall record the statement, if any, given by the owner of the tobacco or his representative or the driver or other person incharge of the goods carrier and shall require him to produce proper and genuine documents as referred to in sub-section
10. (2) or sub-section (4), as the case may be, if after the enquiry, such officer finds that there has been an attempt to evade the tax due under this Act, he shall, by order, impose on the owner of the tobacco and in case the owner is not forthcoming or his identity is not disclosed by the person incharge of the tobacco or the driver or person incharge of the goods carrier, in which tobacco is being carried, on the person incharge of the tobacco or the good carrier or the driver, a penalty between twenty and forty percent of the value of the tobacco and in case he finds otherwise, he shall order the release of the tobacco: Provided that no penalty shall be imposed unless the owner of the tobacco or his representative or person incharge of the tobacco or the goods carrier or the driver has been given a reasonable opportunity of being heard.
11. (7) If the owner of the tobacco or his representative or the driver or other person incharge of the goods carrier does not furnish security or execute the bond as required by sub-section
12. (5) within ten days from the date of detaining the tobacco or goods carrier, the officer referred to in that sub-section may order further detention of the goods, and in the event of the owner of the goods not paying the penalty imposed under sub-section
13. (6) within twenty days from the date of the order imposing the penalty, the tobacco detained shall be liable to be sold for the realization of the penalty in the manner provided in sub-section (9).
14. (8) When any tobacco is detained under sub-section (7), the officer detaining the tobacco shall issue to the owner of the tobacco, if present or, if the owner of the tobacco is not present to his representative or the driver or other person incharge of the goods carrier, a receipt specifying the description and quantity of the tobacco so detained and obtain an acknowledgement from such person or, if such person refuses to give an acknowledgement, record the fact of refusal in the presence of the two witnesses.
15. (9) The goods detained under sub-section
16. (7) shall be sold, by the officer who imposed the penalty, by public auction in the manner prescribed, and the sale proceeds shall be deposited in the Government treasury.
17. (10) If the tobacco detained is of a perishable nature, or subject to speedy and natural decay, or when the expenses of keeping them in custody are likely to exceed its value, the officer-in-charge of the check-post or barrier or any other officer empowered under sub-section (2), as the case may be, shall immediately sell such tobacco or otherwise dispose it of and deposit the sale proceeds, or the amount obtained by the disposal otherwise than by way of sale, in the Government treasury.
18. (11) If the order of imposition of penalty under sub-section
19. (6) or of detention of tobacco under sub-section
20. (7) is in the mean-time set aside or modified in appeal or other proceedings, the officer detaining the tobacco and imposing the penalty, as the case may be, shall also pass consequential orders for giving effect to the order in such appeal or other proceedings as the case may be.
21. (12) Where the detained tobacco is sold or otherwise disposed of under this section, the owner thereof shall be liable to pay the expenses and other incidental charges incurred in detaining and disposing of the same.
22. (13) If the sale proceeds of any tobacco sold or the amount obtained on the disposal of any tobacco otherwise than by way of sale under the provisions hereinbefore contained exceeds the penalty imposed in respect of such tobacco, such excess amount after deducting the expenses and incidental charges referred to in sub-section
23. (12) shall be returned by the officer who conducted the sale or otherwise disposed of the tobacco, to the owner of the tobacco.
24. (14) At every station of transport of goods, bus stand or any other station or place of loading or unloading of goods, other than a post office, when so required by the Commissioner or any person appointed to assist him under sub-section
25. (1) of section 3, the owner or person incharge of the tobacco or the driver or other person incharge of the goods carrier shall produce for examination, transport receipt and all other documents and account books concerning the tobacco carried, transported, loaded, unloaded, consigned or received for transport, to be maintained by him in the prescribed manner and the Commissioner or the person so appointed shall have for the purpose of examining that such transport receipts and documents and account books are in respect of the tobacco carried, transported, loaded, unloaded or consigned or received for transport, the power to break open any package or packages of goods. If the Commissioner or the person so appointed is satisfied that it is necessary for the purposes of investigation or verification, he may seize the transport receipts documents or account books believed by him to be relating to supply of tobacco so produced for examination or found lying at such a station or transport of goods, bus stand or any other station or place of loading or unloading of goods. The officer seizing the transport receipts, documents or account books shall forthwith grant a receipt for the same and shall return to the person from whose custody these were seized after examination or completion of investigation or verification within a period of one hundred and eighty days. Where the transport receipts, documents or account books so seized are required to be retained beyond the aforesaid period, the authority so retaining them shall record the reasons, in writing and shall obtain the approval of the Commissioner for so doing.
26. (15) Except in accordance with such conditions, as may be prescribed with a view to ensuring that there is no evasion of tax imposed by or under this Act,-
    • (a) no driver or person-in-charge of a goods carrier or any person-in-charge of a place of loading or unloading of goods, other than a post office, shall accept any consignment of tobacco for transport or give delivery of any consignment of such tobacco;
    • (b) no dealer or any person including a carrier of goods acting on behalf of a dealer, shall take delivery of, or transport from any station of transport of goods, bus stand or any other station or place of loading or unloading of goods, airport or any other place, whether of similar nature or otherwise other than a post office, any consignment of tobacco referred to above.

When a carrier or bailer to whom tobacco is delivered for transmission, before delivery is taken from him, keeps the said tobacco in any office, shop, go down vessel, receptacle, vehicle or any other place, the Commissioner or any person appointed under sub-section

1. (1) of section 3, to assist him shall have power to enter into and search such office, shop, go down, vessel, receptacle vehicle or other place and to examination or inspection and shall produce the documents relating to supply of such other documents as may be required regarding the tobacco and give his name and address and the name and address of the carrier of the bailer and of the consignor and the consignee. Explanation – For the purpose of this section and section 12 where tobacco is delivered to a carrier or other bailer for transmission, the movement of the tobacco shall be deemed to commence at the time of such delivery and terminate at the time when delivery is taken from such carrier or bailer.