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PETITIONER: TRIPURA GOODS TRANSPORT ASSOCIATION & ANR.

       Vs.

RESPONDENT: COMMISSIONER OF TAXES & ORS.

DATE OF JUDGMENT:       18/12/1998

BENCH: K.Venkataswami

JUDGMENT:

MISRA, J.

     Leave granted.

     The  appellant-Association 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   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   23rd September,  1994  and 15th October, 1994.  By means  of  the aforesaid  11th  Amendment, sub-rule (3) has  been  inserted after  sub-rule  (2) of Rule 46-A of the Tripura  Sales  Tax Rules,  1976,  (for short Principal Rules), sub-rule  (1A) has  been  inserted after sub-rule 63A (1), sub-rule (2)  in Rule  63A has been substituted in place of old sub-rule  (2) of the principal Rules and Rule 64A has been substituted for the  old  sub-rule  64A.   The   resultant  effect  of  such amendment  is  that  the  appellants,  who  are  working  as Transporters   in   Tripura,  are   required  to  obtain   a Certificate of Registration 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 Section 36A of the Act for carrying on transport  business while entering into or going outside the State  of  Tripura including making the declaration in  Form XXIV,  which  is  challenged to be  beyond  the  legislative competence  of  the  State Legislature and ultra  vires  the Constitution  offending  Articles 14, 19 (1)(g),  246,  265, 286,  300A  and  301  of the  Constitution  of  India.   The challenge  is  based on the ground that the  appellants  are Transporters  and  are  not dealers within  the  meaning  of Section 2 (b) of the said Act, hence obligation cast on them under  the  Act  and  Rules   are  beyond  the   legislative competence of the State legislature.

     By  a  reasoned  order, the learned Single  Judge  was pleased  to  dismiss  the writ petition of  the  appellants, except  the challenge to the validity of Rule 63A (2) of the principal  Rules.   However,  the   challenge  made  by  the appellants regarding constitutional validity of Section 36A, which  requires  a  carrier to maintain proper  accounts  of goods  transported  to  or  outside Tripura  in  the  manner

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prescribed, was not entertained by the learned Single Judge. In  appeal before the Division Bench, though foundation  was laid  but specific prayer for declaration of Section 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 appeal  of  the  appellants.   Aggrieved by  the  same,  the present appeal is filed.

     Learned counsel for the appellants, Mr.  M.L.  Lahoty, made  two-  fold  submissions in support of  the  challenge. First,  the  obligation  cast under it on  the  Transporters could  only  be on a dealer and since the  Transporters  are neither  trading in sale nor purchase of any goods hence not a dealer as defined under Section 2(b) of the Act, hence the impugned  provisions lack legislative competence.  Secondly, when  it further casts an obligation on such transporters to obtain  certificate of registration under the said Act, when any  good  is  brought within or sent outside the  State  of Tripura  and further to fill Form XXIV, it impedes free flow of  trade and business of the appellants, hence violative of Article 301 of the Constitution of India.

     In  support of his first submission, he submitted that Sec.   29  refers to offences and penalties not confined  to dealers as it begins with the word whoever, which includes the transporters.  As per sub-clause (4) whoever fails, when required  by or under the provisions of this Act to  produce any  accounts,  evidence  or  documents or  to  furnish  any information,  are  liable  for   conviction  by  a  Judicial Magistrate, punishable with imprisonment which may extend to six months or with fine not exceeding one thousand rupees or with  both.   Composition  of offences  is  conferred  under Section  32.  The Commissioner may, under it, either  before or  after  institution of criminal proceedings, accept  from the  person who has committed or is reasonably suspected  of having  committed an offence under the Act or the Rules made thereunder,  by way of composition of offence on such  terms and  conditions as prescribed, and on payment of such sum as determined  by the Commissioner, no further proceeding is to be taken against such person in respect of the such offence. Reference  was  also  made to Section  36A,  which  requires maintenance  of accounts by a carrier including Transporter, the  class  to which the appellants belongs.  This  puts  an obligation  on the Transporter to maintain proper account of goods  transported  to  or  outside Tripura  in  the  manner prescribed and is liable to furnish in the prescribed manner such information as the Commissioner may require relating to the transportation of such goods.  Reference is also made to Section  38B,  which  requires the Transporter,  Carrier  or Transporting Agent operating its transport business relating to  taxable  goods  in Tripura to obtain  a  Certificate  of Registration  in the prescribed manner from the Commissioner of Taxes on payment of such fees as may be prescribed.

     To appreciate this controversy, Section 29(1) and (4), Sections  30, 32, 36A and 38B are quoted hereunder:  Section 29 :

     29.  Offences and penalties (1) Whoever - (1) Carries on  business as a dealer and acts in contravention of any of the  provisions  of  this  Act;    or  (2)  fails,   without reasonable  cause,  to  submit  in due time  any  return  as required  by or under the provisions of this Act, or submits

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a false return;  or (3) fails, when required by or under the provisions of this Act to keep accounts or records of sales; or  (4)  fails, when required by or under the provisions  of this  Act to produce any accounts, evidence or documents  or to  furnish  any information;  or (5) fails or  neglects  to comply with any requirement made of him under the provisions of  this Act;  or (6) knowingly produces incorrect accounts, registers  or  documents, or knowingly  furnishes  incorrect information;  or

     xxx xxx xxx

     shall,  on conviction before a Judicial Magistrate and in addition to any tax including interest if any, or penalty or  both  that  may  be due from  him,  be  punishable  with imprisonment which may extend to six months or with fine not exceeding  one  thousand rupees or with both, and  when  the offence is a continuing one, with a daily fine not exceeding fifty  rupees  during  the  period  of  continuance  of  the offence.

     2.  xxx xxx xxx

     Section 30 :

     30.   False statement in declaration :  Whoever makes statement  in verification or declaration in connection with any  proceedings under this Act which is false, and which he either knows or believes to be false, or does not believe to be  true, shall on conviction before a Judicial  Magistrate, be  punishable with simple imprisonment which may extend  to six  months  or with fine which may extend to  one  thousand rupees, or with both.

     Section 32.

     32.   Composition of offences :  (1) Subject to  such conditions  as  may  be prescribed,  the  Commissioner  may, either  before or after institution of criminal  proceedings under  this Act, accept from the person who has committed or is reasonable suspected of having committed an offence under this Act or the rules made thereunder, by way of composition of such offence

     (a)  Where the offence consists of the failure to pay, or  the  evasion of any tax recoverable under this  Act,  in addition  to the tax including interest if any or penalty or both  so  recoverable,  a  sum of money  not  exceeding  one thousand rupees or double the amount of the tax recoverable, whichever  is  greater, and (b) in any other case a  sum  of money  not exceeding one thousand rupees in addition to  tax recoverable.   (2)  On  payment  of   such  sum  as  may  be determined  by  the  Commissioner under Sub section  (1)  no further  proceeding  shall  be   taken  against  the  person concerned in respect of the same offence.

     Section 36A.

     36A.   Maintenance  of  Accounts by Carriers  :   (1) Notwithstanding  anything  contained in any other  Act,  any transporter,  carrier  or transporting agent  operating  its transport business in Tripura, shall maintain proper account of goods transported to or outside Tripura through it in the manner prescribed and shall on demand by the commissioner be liable  to furnish in the prescribed manner such information

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as   the   Commissioner   may   require  relating   to   the transportation  of  such  goods and shall also be  bound  to produce  books of accounts for inspection and examination by the Commissioner.

     Section 38B.

     38B.   For  carrying out the purposes of  section  38 every  Transporter, carrier of Transporting Agent  operating its  transport business relating to taxable goods in Tripura shall be required to obtain a Certificate of Registration in the  prescribed  manner  from the commissioner of  Taxes  on payment or such fees as may be prescribed.

     The  Transporter  has  to make a declaration  in  Form XXIV,  which  is an obligation cast on such  Transporter  by virtue of Section 38 (2) read with sub-rule (3) of Rule 46A, which  requires the Transporter to obtain Form XXIV from the Superintendent  of  Taxes on payment of such fees as may  be specified  by  the  Commissioner.   Transporter  is  further obliged to maintain a register of the accounts of such forms serially.  Rule 63A read with Section 38(3) confers power to search  at  any  place on the Officer-in-charge of  a  check post,  Superintendent  of  Taxes or  any  officer  specially empowered  by  the  Commissioner to  intercept,  detain  and search  any  vehicle  or place suspected of being  used  for contravening  provisions.   Sub-rule (1A) of this  Rule  63A read  with  Section  38(4)  gives power of  seizure  on  the aforesaid  officer  at the check post when goods  are  being carried  in contravention of any provision of the Act or the Rules.   Under sub-rule (2) the person, from whom such goods are  seized, has to make a declaration of the value of  such seized  taxable goods.  Such declaration is to be  submitted to  the Superintendent of taxes with copies of the  relevant bills, invoice, and consignment note issued by the consignor and  other  documents in support of the basis on  which  the value  is  declared.   Sub-rule (3) gives an option  to  the person   from  whom  such  goods   are  seized  to  opt  for composition of such offence under Section 32 and then to pay for  the  composition  of the offence so  determined  within seven  days from the date of composition of the offence.  In case  he  does  not opt, then such goods are  liable  to  be auctioned  in terms of sub-rule (4).  Next reference was  to Rule  64A which requires registration of Transporter.  Rules 46-A,  Rule  63A  and Rule 64A are quoted  hereunder:   Rule 46-A:   46-A.  (1) Every declaration to be given under sub- section(2)  of  section  38  shall  contain  a  correct  and complete  accounts  of the goods carried by the  transporter and  shall be in Form XXIV in duplicate, and duly signed  by him:   Provided  that if the space provided in Form XXIV  is not sufficient for making the entries, separate annexure may be attached to the form for the purpose which should be duly signed by him.

     (2)  The  Officer-in-charge of the check post  or  the barrier  on  being  satisfied about the correctness  of  the statements made and particulars contained in the declaration in  Form XXIV, shall seal it with his official seal and give a  permit.   One  copy  of the permit shall  there  upon  be returned  to the transporter and the other shall be retained by  the Officer-in-charge:  Provided that a transporter  who has  obtained  a permit at the first check post  or  barrier under sub-rule (2) shall not be required to make any further declaration  at  other checkposts or barrier in  respect  of only  so  much  of  the consignments  to  which  the  permit

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relates.

     (3)  The  transporter shall obtain Form XXIV from  the Superintendent  of Taxes concerned on payment of such  price as  may be specified by the Commissioner.  The Form shall be serially  numbered  and  account   shall  be  maintained  in register.  No other Form XXIV except those supplied from the office  of Superintendent of Taxes shall be entertained with effect  from  such  date as the Commissioner may  notify  by publication in the local newspapers and Official Gazette.

     Rule 63A:

     63A.   (Power  to search at any place by  Officer-in- charge  of  a  check post, Superintendent of  Taxes  or  any officer specially empowered by the Commissioner:

     (1)  Notwithstanding  anything contained in any  other provision  of these Rules, at every check post or barrier or at  any  other  place,  when so  required  by  the  Officer- in-charge   of   such  check  post   or  barrier,   by   any Superintendent  of Taxes or by any officer empowered by  the Commissioner  of  Taxes  in this behalf for the  purpose  of preventing  the evasion of taxes payable under the Act,  the driver  or  any  other persons in charge of  goods  vehicles shall stop the vehicle and keep it stationary as long as may be  required by such officer to search the goods vehicle  or part  thereof, examine the contents therein and inspect  all records  relating  to  the goods carried which  are  in  the possession of such driver or other person in charge thereof, who shall, if so required, give his name and address and the name  and  address  of the owner of the vehicle as  well  as those of the consignor and consignee of the goods.

     1A  - On search, as aforesaid, if it is found that the goods are being carried in contravention of any provision of the  Act  or the Rules, such officer conducting  search  may seize the goods found in the vehicle alongwith any container or materials used for packing.

     (2) When any taxable goods are seized, the person from whom  such  goods  are seized shall make  a  declaration  in respect  of  the value of the seized taxable goods and  this value  shall be the retail prices or the aggregate of retail prices of such goods at which these are likely to be sold in Tripura  at  the relevant time.  Such declaration  shall  be submitted  to the Superintendent of Taxes with copies of the relevant  bills, invoice, and consignment note issued by the consignor and other documents in support of the basis of the value  declared.  The copies so furnished may be returned to the  person after the Superintendent satisfies himself about the value of the goods declared.

     (3)  When  the person from whom the taxable goods  are seized opts for composition of such offence under Section 32 within  a period of 15 days from the date of seizure of  the goods,  the amount of composition money so determined  shall be payable within 7 days from the date of composition of the offence   by  payment  into   Government   treasury.    Upon production  of the receipted copy of the challan in  support of  payment  to  the  Superintendent  the  seized  goods  be released.

     (4)  If the person from whom the goods are seized does not opt for composition of the offence within a period of 15

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days  from  the  date of seizure or  having  compounded  the offence,  does not pay the amount in due time as provided in sub-rule  (3) the Superintendent with the previous  sanction of  the Commissioner, shall issue a proclamation in form No. XXI  for  auction for sale of such seized goods on  a  fixed date,  place and time.  The description of the taxable goods shall  be  mentioned in the proclamation.  The  proclamation shall  be  published in at least one local  newspaper.   The auction  shall  be  conducted by the Superintendent  or  any other official authorised by the Commissioner.

     (5)  The  auction shall be governed by the  conditions laid down in the proclamation (Form No.  XXI).

     Rule 64A

     64A.  Registration of Transporter etc.

     (1)  No  transporter, carrier, or  transporting  agent shall  operate its transport business in Tripura relating to taxable goods without being registered with the Commissioner of Taxes in such a manner as he may direct.

     (2)  A  transporter,  carrier, or  transporting  agent already  operating transport business in Tripura relating to taxable  goods  shall, within a period of 30  (thirty)  days from  the  date  of commencement of  these  rules  (Eleventh Amendment)   apply   to  the   Commissioner  of  Taxes   for registration.

     (3)  If a transporter, carrier or a transporting agent carries  or transports any taxable goods in contravention of the  provisions  of the Act or the rules,  his  registration shall be liable to be cancelled or suspended for such period as  may  be  determined by the Commissioner of  Taxes  after giving him a reasonable opportunity of being heard.

     (4)  Every transporter, carrier or transporting  agent operating its transport business in Tripura shall maintain a Register  in  Form No.  XXII a true and correct  account  of every  consignment of goods transported into Tripura, and in Form  No.   XXIII  of  goods  transported  outside  Tripura, through it.

     (5)  No  taxable  goods  shall  be  delivered  by  the transporters  carriers  or  transporting agents  unless  the requirements  laid down in Rule 46 and 47 have been complied with.

     (6) No delivery of taxable goods shall be given by the transporter  without obtaining a copy of declaration in Form XVIII  signed  by the superintendent of  Taxes/Inspector  of Taxes.

     Learned  counsel  for the appellants vehemently  urged that  the  appellants are mainly the  Transporters  carrying goods  of  the consignor to the consignee and are neither  a dealer  nor  doing any business of sale or purchase  of  any goods,   hence  the  aforesaid   obligations  cast  on   the transporters  including punishment for the said offences are beyond  the legislative competence of the State  Legislature under  List  II of Entry 54 of the Seventh Schedule  of  the Constitution of India.

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     Learned  senior  counsel  for   the  respondents,  Mr. Rakesh  Dwivedi,  submits that none of the  said  provisions require  the appellants (Transporter) to perform any of such obligations so as to construe it to be that which could only be  on  a  dealer.   The aforesaid provisions  are  only  to streamline assessment and to check the evasion of sales tax. The  said  obligation casts on the Transporters  to  achieve such  purpose,  is  a necessary concomitant  of  any  taxing statute.  He submits that the offence and penalties referred to  in  Section 29 (4), which is strongly relied by  learned counsel for the appellants, when read with other sub-clauses of  that  Section and further read with Section  30,  reveal that  it is only a mechanism to make collection of tax  more effective  and  purposeful.  Sub-section (4) of  Section  29 constitutes  offence  only  when one fails to  produce  such account  or  form  as  he is required  under  the  law  when required  by  the concerned authority.  This is a  necessary corollary   for  which  an  obligation   is  cast   on   the Transporters to do certain thing.  This threat of offence is only to keep him on guard so that he may not fail to produce such  documents as required, but for this the very objective to  trace  a  real  dealer  for tax  and  penalty  would  be defeated.   Thus this obligation cast on the Transporter  is really  in  aid  to  the  taxing  authorities.   Section  30 constitutes  offence  when  a false statement  is  declared. This  is  followed  by  the composition  of  offences  under Section  32.   Section  36A   requires  the  maintenance  of accounts.   Similar  is  the position with  respect  to  the aforesaid  Rules.   They  are all in aid  of  the  mechanism evolved  to  check  evasion  of tax.   Next  requirement  of obtaining  a  Certificate of Registration under Section  38B and making declaration on Form XXIV under sub-Rule 3 of Rule 46-A  could  not be construed as to constitute an  inference that  it  impedes any free flow of trade or  business  while entering into and going out of the State of Tripura.

     Thus,  the question for consideration with respect  to the  first  submission is, whether such provisions could  be held  to  be beyond the legislative competence of the  State Legislature?  The law in this regard is well-settled, if any legislature  makes  any  ancillary or  subsidiary  provision which  incidentally transgresses over its jurisdiction,  for achieving  the object of such legislation then it would be a valid peace of legislation.

     In  Express Hotels Private Ltd.  Vs.  State of Gujarat & Anr., 1989 (3) SCC 677, this Court held:

     We  are dealing with an entry in a Legislative  List. The entries should not be read in a narrow or pedantic sense but  must  be  given their fullest meaning  and  the  widest amplitude  and  be  held  to extend  to  all  ancillary  and subsidiary  matters which can fairly and reasonably be  said to be comprehended in them.

     In  Elel  Hotels  and Investments Ltd.   &  Ors.   Vs. Union of India, 1989 (3) SCC 698, this Court held:

     In interpreting expressions in the legislative lists a  very  wide  meaning should be given to the  entries.   In understanding  the  scope  and amplitude of  the  expression income  in  Entry 82, List I, any meaning which  fails  to accord  with the plenitude or the concept of income in all

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its  width  and  comprehensiveness should be  avoided.   The cardinal  rule of interpretation is that the entries in  the legislative  lists  are  not  to  be read  in  a  narrow  or restricted  sense and that each general word should be  held to  extend to all ancillary or subsidiary matters which  can fairly and reasonably be said to be comprehended in it.  The widest  possible  construction,  according to  the  ordinary meaning of the words in entry, must be put upon them.

     In P.N.  Krishna Lal & Ors.  Vs.  Government of Kerala & Anr, 1995 Suppl.  (2) SCC 187, this Court held:

     The  legislature derives its power under Article 246 and  other  related  articles  in  the  Constitution.    The language  of  an  entry should be given the  widest  meaning fairly  capable to meet the need of the Government envisaged by the Constitution.  Each general word should extend to all ancillary  or  subsidiary  matters   which  can  fairly  and reasonably  be comprehended within it.  When the vires of an enactment  is  impugned, there is an initial presumption  of its  constitutionality.   If there exists any difficulty  in ascertaining the limits of the legislative power, it must be resolved,  as far as possible in favour of the  legislature, putting  the  most liberal construction on  the  legislative entry so that it is intra vires.

     It  is  now  necessary  to  scrutinise  the   impugned provisions  to  see  what are the obligations  cast  on  the transporters,  what is the purpose of such obligation, is it in  any  way  taxing  such   transporters  or  impeding  the transport  business  to  make  it  beyond  the   legislative competence  and ultra vires Article 301 of the  Constitution of India?  Whenever any goods is sold or purchased inside or outside  the State, the incidence of tax and the quantum  of tax  has  to  be  ascertained under the  provisions  of  the relevant taxing statute.  For this, it is necessary to fix a dealer, the taxable goods, place of sale or purchase of such goods  and the quantum of tax.  If a dealer in taxable goods transaction  of  sale or purchase escapes attention  of  the taxing  authority, tax on such goods escapes with  resultant loss  to  the  State revenue.  To over reach  this  possible escape  a  mechanism is invariably brought in a  statute  to seal such loopholes of escape, of course casting obligations on  some  to perform certain acts to reach  this  objective. Thus,  maintaining  accounts  of goods transported  into  or outside  Tripura in the prescribed manner and to furnish  in the  prescribed manner such information as the  Commissioner requires including filling of Form XXIV is only for the said objective  to  be  achieved with the help and  aid  of  such transporter  or  carrier etc.  Such obligation is cast  only for  identifying the consignor or consignee to fix liability on  them  in  corelation  with the  goods  carried  by  such transporter  further requiring the disclosure of such  goods with  its  quantity,  value,  weight,  to  help  the  taxing authority  to  assess  such goods on such  escaping  dealer. This  helps  the  taxing authorities  in  collecting  taxes, imposing  penalties including punishing one for the offences committed.   If  such  an  obligation is not  cast  on  such Transporters  then  any  dealer  under  a  false  name,  can despatch  his  taxable  goods to another  person  through  a Transporter  escaping his sales tax liability on such goods. It  cannot be denied that some such dealers and transporters

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do  indulge in such illegal practices.  This fact is brought in    through   the    counter-affidavit    filed   by   the respondents-State  that  some such consignments  are  booked with  consignee  as  self,   without  disclosing  the  name, registration  number  and  address of the consignee  in  the appropriate  column of Form XXIV.  By incorrect,  incomplete declaration  in  such forms, if not made  punishable,  would defeat  the  very purpose of enacting these  provisions  and would help such clandenstile dealers to escape the liability of  tax.  So each of these provisions are brought in to help the authorities to check the evasion of tax.

     The  maintenance of accounts by the Transporter  under Section  36A  is only to help the taxing authority to  trace the  dealer, fix the goods transported corelating with  such dealers transporting such goods for fixing taxable liability in  this  regard.   There is no provision, which  fixes  any liability  on the transporters, carriers etc., which is on a dealer.  Liability, if at all, is only if such transporters, carriers  etc.  do not disclose what is required and what is within  his knowledge to help the authorities to collect the tax from escaping dealers which, but for this, would escape. Section  29  speaks  of offences covering both  dealers  and non-dealers  as  is evident by the opening  word  whoever. Sub-section  (4),  to  which learned  counsel  referred  to, obligates  a  person  to produce any accounts,  evidence  or documents  or to furnish any information as required by  the concerned  authority.  Of course, all this would be what one is  required  to maintain and in the case  of  transporters, carriers  etc.  what the relevant provisions require him  to do.   If he is required to maintain or produce some document which he has to maintain under a statute, and if he does not produce  it  then  of course he should be  made  liable  for offence.   It  is  only  on his failure to do  this,  it  is treated  as  an  offence,  punishment as it is  one  of  the legitimate  weapons to enforce one to help the  authorities. Such  information  and documents sought are either  with  or within  the knowledge of Transporter.  As aforesaid, this is for  the  sole  objective of ascertaining  a  consignor  and consignee  of  the  taxable goods which the  transporter  is carrying.  Such requirement has no co-relation with the sale and  purchase  of  the goods or to treat  a  Transporter  as dealer and consequently, no obligation is cast on him to pay any tax, interest or penalties which a dealer is required to pay.   Similarly  Section 30 refers to offence only  when  a false declaration is made in connection with any proceedings under  this  Act,  which he either knows or believes  to  be false,  or  does  not  believe  to  be  true.   Again,   the conviction  under  it is only for making  false  declaration which  is within his knowledge.  How can this constitute  to be  a ground for legislative competence?  This provision  is only  to see that the correct statement of facts 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,  the  offences  in  case committed  by  Transporter  are relateable  to  checking  of evasion of tax, then composition of offence under Section 32 would  also  confine itself within this sphere.  We  do  not find  any  of  these  provisions  in  any  way  placing  any liability  on the Transporter which is otherwise on a dealer under this Act.  Similarly, as aforesaid, the maintenance of account  by  the transporters, carriers etc.  under  Section 36A  is  only to render help to the authorities in  checking the  evasion of tax.  This does not put any such  obligation

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on  the Transporter to hold that these provisions transgress the legislative competence of the State legislative.

     Further  Rule  46A read with Section 38  (2)  requires every person transporting taxable goods at any check post or barrier  referred to in sub-section (1), to file before  the Officer-in-charge  of  such check-post or barrier a  correct and  complete  declaration of the goods in such form and  in such  manner  as may be required.  It is by virtue  of  this Rule  46A  a  Transporter is required at the check  post  to disclose  complete  accounts of the goods carried by him  in Form  XXIV.   The  question is why such  requirement?   Form XXIV,  which  is  the main plank of attack  by  the  learned counsel  for  the appellants is really based on the  offence under Section 29 (4) or Section 30 in case declaration under it is found to be false.  Now, we proceed to examine what is required to be filled by the transporters in Form No.  XXIV. This  Form requires to disclose the name and address of  the consignor,  whether  a  registered dealer or not,  place  of despatch  and  destination  of   the  goods,  lorry  number, description   of  consignment,   quantity,  weight,   value, Consignors invoice number and date, railway receipt or bill of  lading and in case goods are sent outside the State, the permit  number  and date authorising such export under  Rule 47C.   First,  the  question  is  why  such  information  is required,  if necessary, what possibly is the difficulty  of the  transporters, finally whether any objection by them  is sustainable in law?  As we have said that these informations are required solely for the purpose for checking the evasion of  tax.   Next,  we  do not find  any  difficulty  for  any transporter  to  disclose  the names and  addresses  of  the consignor  and  the consignee, the place of destination,  he would  also be knowing the description of consignment  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 value of the good, would be  based on  the basis of the 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 the offence 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  information  of  the consignor,  the  offence  is  not   drawn  unless  there  is connivance between the transporter and the consignor.

     He  also  referred to sub-rule (1A) of Rule 63A  under which  the  good are being carried in contravention  of  the provisions  of  the Act or the Rules, is liable for  seizure and  under  sub-rule  (3) he is made liable to pay  for  the composition  of  such  offence in view of Section  32.   The aforesaid  submissions  for the appellants are  without  any force.   So far as the fear with reference to Form XXIV,  as we have said above, he is aware of the same and the same are based  on  the  information  given by  the  consignor.   The purpose  of this form rightly is to ascertain the  consignor and  consignee and the details of the goods for the  purpose of  taxing  such  goods under the Act.  No  Transporter  can

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escape  this  declaration  as this is one of  the  essential mechanisms  evolved to help the taxing authorities to  check the  evasion.  Submission of the learned counsel, expressing the  fear,  if  ultimately  statement in case  found  to  be incorrect  as per his disclosure in Form XXIV, that he would be  held  liable for offence is also unfounded.  Apart  from what  we have recorded above, Column 13 (i) of the said form directs the declaration to be made in the following terms:

     I/We  hereby  declare that the above  statements  are true to the best of my/our knowledge and belief.

     This  itself  clearly indicates when the liability  of the  offence punishable under Section 29 or Section 30 would be drawn.  It only arises when such Transporter deliberately makes  false  declaration and not when such  declaration  is true  to  his knowledge and belief.  Learned senior  counsel for the respondents fairly stated that the purpose mainly is to  get the disclosure of the name and address etc.  of  the consignor  and consignee.  The rest of the columns from 7 to 13  are  primarily  to  be filled in on  the  basis  of  the information  given  by the consignor.  Every taxing  statute has charging sections.  It lays down the procedure to assess tax and penalties etc.  It also provides provisions to cover pilferage  of such revenue by providing such mechanism as it deem  fit,  in other words, to check evasion of tax  and  in doing  so  if  any obligation is cast on any  person  having connections  with consignor or consignee in relation to such goods,  may  be  other  than  a  dealer,  to  perform   such obligation  in aid, to check evasion and in case he is  made liable  for  any  offence, for his dereliction  of  duty  or deliberate false act contrary to what he is obligated to do. In  our  opinion,  it cannot be construed to be  beyond  the competence  of States Legislature.  The impugned  provisions are not charging Sections, no tax liability is placed on the transporters.   We find neither Sections 29, 30, 32, and 36A nor  Rules 46A, 63A and 64A lack any legislative competence. They  are within the legislative competence of the State and would fall under List II of Entry 54 of the Seventh Schedule of  the  Constitution of India.  In Sodhi Transport  Co.   & Ors.   Vs.   State  of  U.P.   & Ors.,  1986  (2)  SCC  486, challenge  was made to the provisions of Section 28-B of the U.P.   Sales  Tax  Act, which requires a  Transporter  while entering  the State of Uttar Pradesh to obtain transit  pass for  its delivery at the exist barrier where the Transporter leave  the  State  of  Uttar Pradesh and on  its  failure  a presumption is drawn the goods carried inside the State have been  sold  within the State either by the owner  or  person incharge  of  the vehicle.  The Court held that  such  goods carried  have  been  sold within the State is  a  rebuttable presumption.   The persons concerned have the opportunity to discharge  the presumption by getting a finding recorded  in his  favour.  Thus, if the person proves the presumption  to the  contrary,  no liability is fasten on him.  However,  in case he fails to avail this opportunity or fails to prove to the contrary then he would be a dealer even according to the definition of the word dealer subject to other conditions, hence  it  was held that there is no unconstitutionality  of this provision.  This Court held:

     The words it shall be presumed in Section 28-B only require  the  authorities  concerned to raise  a  rebuttable presumption, that the goods must have been sold in the State if the transit pass is not handed over to the officer at the check-post  or  the barrier near the place of exit from  the

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State.   A  statutory provision which creates  a  rebuttable presumption  as regards the proof of a set of  circumstances which would make a transaction liable to tax with the object of  preventing  evasion of the tax cannot be  considered  as conferring  on  the authority concerned the power to levy  a tax   which  the  legislature   cannot  otherwise  levy.   A rebuttable presumption has the effect of shifting the burden of  proof.  The authority concerned before levying sales tax arrives  at  the conclusion by a judicial process  that  the goods have been sold inside the State and in doing so relies upon  the statutory rule of presumption contained in Section 28B  of the Act which may be rebutted by the person  against whom  action  is  taken  under   Section  28B.   The  person concerned  having opportunity to displace the presumption by leading  evidence,  there is no unconstitutionality  in  it. When  once a finding is recorded that a person has sold  the goods  which he had brought inside the State, he would be  a dealer even according to the definition of the word dealer as it stood from the very commencement of the Act subject to the  other  conditions  prescribed  in  this  behalf   being fulfilled.   There  is,  therefore,  no  substance  in   the contention  that a transporter was being made liable for the first time after 1979 with retrospective effect to pay sales tax on a transaction which is not a sale.

     This  is  also a case where obligation is cast on  the Transporter to fill up the transit form and, on his failure, an  inference  was drawn holding such transporter liable  to pay  the tax like that by a dealer.  However, in the case in hand,  at no stage the transporter is held liable to pay the tax  as  payable by a dealer.  We have already  referred  to sub-rule  (1A)  to  Rule 63A as to when the goods  could  be seized.   Sub-rule  (3) of Rule 63A gives an option  to  the Transporter in case goods carried by him is in contravention of  any  provisions  of  the Act and the  Rules,  if  he  so desires,  to opt for composition of offence.  A  Transporter can always intimate within the time specified under sub-rule (3)  to  a dealer or owner of the goods to come and pay  the amount fixed under Section 32.  In case not, it is open to a Transporter  not  to  opt for composition  of  offence.   No liability  is  fastened  on him, then  the  authorities  may proceed to take action under sub-rule (4).  By following the procedure therein, the seized goods are auctioned to recover the  liability  of a dealer of tax, penalty etc.  under  the Act.   It is significant that sub-section (1) of Section 38A records  that  in case any balance amount is left after  the said  auction,  the same to be returned to the  person  from whom  such  goods are seized or to the owner of such  goods. It  is  coherent with the scheme of the Act, to collect  the tax and penalty by this mechanism, what otherwise would have escaped  assessment.  Finally, the second submission is with reference  to  the requirement of obtaining  Certificate  of Registration  under  Section  38B which,  according  to  the learned counsel, impedes the free flow of trade and business of  a  Transporter  hence violative of Article  301  of  the Constitution.   For  ready reference Section 38B  is  quoted hereunder:   For  carring  out the purposes of  section  38 every  Transporter,  or  Trnasporting  Agent  operating  its transport  business  relating  to taxable goods  in  Tripura shall be required to obtain a Certificate of Registration in the  prescribed  manner  from the Commissioner of  Taxes  on payment of such fees as may be prescribed.

     This  section,  itself indicates, has been brought  in

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for carrying out the purposes of Section 38, which basically is  to  check  evasion  of tax.   Under  it,  the  barriers, check-post  are set up, the officers are empowered to  check any  vehicle, seized goods being carried in contravention of any   provision  of  the  Act   and  the  Rule.   Thus,  the requirement   of   Certificate  of   Registration   by   a transporter  is also for the same purpose.  It only  applies to  such  transporters doing transport business relating  to taxable  goods  in Tripura only.  This certainly  cannot  be construed to be violative of Article 301 of the Constitution of  India.  Article 301 provides freedom of trade,  commerce and  intercourse.   This  Article is subject  to  the  other provisions  of  this  part, namely, part XIII  which  covers Articles  301  to 307.  Article 304 (b) empowers  the  State Legislature  to  impose such reasonable restriction  on  the freedom of trade, commerce or intercourse with or within the State  as may be required under the public interest.  When a provision is made for a Certificate of Registration which in the  present case is brought in by amendment as aforesaid is really   for  checking  the  evasion   of  tax.    By   such registration of transporters or carriers it becomes feasible for  the authorities to trace out such dealers escaping tax, 1989  such transporters.

     In State of Bihar & Ors.  Vs.  Harihar Prasad Debuka & Ors.,  1989  (2) SCC 192, challenge is to  the  notification issued  under  Section 31 (2- a) of the Bihar  Finance  Act, 1981,  urging  the  requirement that a  person  transporting goods  exceeding the quantity notified under Section 35 on a goods  carrier to carry permits in prescribed Form {XXVIII-A or  XXVIII- B} in respect of the goods have brought into  or sent  out  of  the State to be restrictive to free  flow  of trade  and  hence violative of Articles 301 and  304.   This Court rejected the submission and upheld the notification by holding  that insistence on permits was intended to  prevent evasion  and  to  facilitate assessment of sales  tax.   The stoppage of transporting vehicle for checking the permit for this  purpose  would not constitute to be violative of  free trade.  Finally, learned counsel for the appellants strongly relied  on  a decision of this Court in State of  Haryana  & Ors.  Vs.  Sant Lal & Anr., 1993 (4) SCC 380.  In this case, this Court held that Section 38 of Haryana General Sales Tax Act  to  be ultra vires.  This section requires  that  every clearing  or  forwarding  agent, dalal or any  other  person transporting  goods  (including manager, agent,  driver  and employee  of  the owner) who handles documents of  title  to goods  for  or  on behalf of any dealer to  furnish  to  the assessing  authority particulars and information in  respect of  transaction of the goods and to obtain licence from  the assessing  authority and on contravention provided high rate of penalty.  The section 38 is quoted hereunder:

     38.   Furnishing  of  information   by  clearing  and forwarding  agents etc.  - (1) Every clearing or  forwarding agent,  Dalal or any other person transporting goods, within the  State, who, during the course of his business,  handles documents  of title to goods for or on behalf of any dealer, shall furnish to the assessing authority the particulars and information  in respect of the transactions of the goods  in such form and manner, as may be prescribed.

     (2)  No  clearing  or forwarding agent, Dalal  or  any other person transporting goods within the State shall carry on  his  business  unless  he  obtains  from  the  assessing authority, on payment of a fee not exceeding fifty rupees, a

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license  in  the  form  and   manner  and  subject  to  such conditions  as  may be prescribed.  (3) If any  clearing  or forwarding  agent  or  Dalal or  person  transporting  goods within  the State contravenes the provisions of  sub-section (1)  or  sub-section  (2)  the Commissioner  or  any  person appointed  to assist him under sub-section (1) of Section  3 may,   after  giving  the   person  concerned  a  reasonable opportunity  of  being  heard, direct him to pay by  way  of penalty,  an  amount equivalent to twenty per centum of  the value  of  goods  in  respect of which  no  particulars  and information  has  been  furnished   under  sub-section  (1). Explanation  - For the purpose of this section- (i)  Dalal shall  include a person who renders his services for booking of,  or  taking  delivery  of, consignments of  goods  at  a Railway  Station,  booking agency, goods  transport  company office,  or  any place of loading or unloading of  goods  or contrives, makes and concludes bargains and contracts for or on  behalf  of  any  dealer for a  fee,  reward,  commission remuneration  or other valuable consideration or  otherwise; (ii)  person transporting goods shall, besides the  owner, include  the manager, agent driver, employee of the owner or person  incharge of a place of loading or unloading of goods or  of  a  Railway out-agency, city booking office  or  city booking  agency,  when  run  by a  private  person  under  a contract  with  the Railways but excluding a rail head or  a post  office, or of a goods carrier carrying such goods, for despatch   to  other  places  or   gives  delivery  of   any consignment of such goods to the consignee.

     (Emphasis supplied)

     Sub-section  (1)  of  Section 38 of  the  Haryana  Act requires   every   clearing  or    forwarding   agent   etc. transporting goods within the State who handles documents of title  to goods to be transported within the State for or on behalf  of any dealer to furnish to the assessing  authority such  particulars  and  information as  may  be  prescribed. Sub-section  (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 documents of titles 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 competence of the State legislature  as  it  could not be in respect of  any  matter ancillary  or  subsidiary  to the  legislative  entry  which entitles  the  State Legislature to impose such  tax.   This section  further imposes a penalty equivalent to 20% of  the value  of  goods  in  respect of which  no  particulars  and information  have  been furnished.  But this decision  holds that  such  clearing or forwarding agent has to be within  a reasonable  and proximate connection between the transaction of  sale  of such goods before the State  Legislature  would 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  the sale occasioning the liability  to  the sales  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 course of his business come to possess.   It is legitimate then to make him liable for such escapement  of tax as has resulted from the breach by him of

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such obligation and to a reasonable penalty.

     ..However,  inasmuch  as the said Act does not  define what  precisely  it  means by the expression  documents  of title  to goods, it is unclear which class of forwarding or clearing agents or dalals or persons transporting goods it intends  to bring within the ambit thereof.  To clearing and forwarding  agents, dalals and other persons  transporting goods  who do not handle documents of title to goods for  or on  behalf of any dealer, the provisions of the said Act can have  no application at all.  In respect of such persons the State  Legislature  has  no power of legislation  under  the legislative  entry  concerned.  Qua them the legislation  is not  in respect of any matter ancillary or subsidiary to the legislative  entry  which entitles the State Legislature  to impose a tax on the sale of goods.

     We find that this decision would render no help to the appellants.   The impugned provisions of the Haryana General Sales  Tax  were  different  than   the  provisions  we  are considering  in this case, namely, the impugned Tripura  Act and  the  Rules.  We further find that sub-para (ii) of  the Explanation  to  Section  38  of the  impugned  Haryana  Act specifically excluded, a goods carrier carrying such goods, for  despatch  to  other  places or gives  delivery  of  any consignment of such goods to the consignee.

     Hence, we hold that the requirement of Section 38B for a  transporter operating its transport business relating  to taxable   goods  in  Tripura  to  obtain   Certificate   of Registration  from  the  Commissioner  of  Taxes,  is   not violative of Article 301 of the Constitution.

     In  view  of the aforesaid findings, we hold that  the impugned  provisions  of the Tripura Sales Tax Act  and  the Rules  of 1976 are valid pieces of legislation.  The  appeal is, accordingly, dismissed.  Costs on the parties.