Jaganmohan Reddy, C.J.
1. These three writ petitions raise the following questions, namely, whether the Sales Tax Authorities have power (a) to levy penalty for non-production of way bills and (b) to confiscate and forfeit the goods found unaccounted for. In W.P. No. 358 of 1964 the Commercial Tax Officer, Guntur, by an order dated 17th February, 1964, directed the confiscation of 123 bags and 14 kgs. being 1/4th of 492 bags and 56 kgs. of paddy as unaccounted stock and called on the petitioners, a firm, to surrender the said quantity of paddy which had previously been released after the seizure of goods in favour of the assessee on 23rd July, 1963, on payment of Rs. 2,956 as cash security, representing its value. The assessee had tried to explain the excess stock of paddy as being due to the fact that while purchasing the paddy, it (the assessee-firm) weighs each bag at 77 kgs. and enters it in the B. Register at 75 kgs. setting of 2 kgs. as weight of the gunny bag. But this explanation was rejected, as it was found that a gunny bag weighs only 1 kg. and not 2 kgs. and that even this explanation does not account for the 492.56 bags. In W.P. No. 1554 of 1965, the Commercial Tax Officer had unearthed on 8th September, 1965, from a rice bag stored in a corner of a room in the mill of the assessee a slip relating to the mill. This slip contained amongst other items, 2 items relating to 238 bags of paddy received on 6th September, 1965, and 8th September, 1965. These bags were unaccounted for in the gate book khata or in any other book of the assessee, and consequently, the stocks were seized and were released on payment of Rs. 3,431 being half the value of the stock seized. He was asked to show cause within 7 days why the excess should not be confiscated. In the last of the writ petitions, 140 bags of ammonium phosphate worth Rs. 4,648 were seized from a lorry while being transported from Madras to Guntur, as they were not covered by the way bill issued by the consignor, for which a penalty of Rs. 690.20 being 5 times the tax due on the goods seized was levied.
2. In all these petitions, the contention of the petitioners is that the State Legislature has no power under entry 54 of List II of the Seventh Schedule to the Constitution, viz., 'Taxes on the sale or purchase of goods other than newspapers' to seize and confiscate the goods or to levy penalty. They submit that Sub-section (6) of Section 28 and Sub-sections (3) and (4) of Section 29 of the Andhra Pradesh General Sales Tax Act, 1957 (hereinafter referred to as 'the Act') empowering seizure and confiscation and the levy of penalty respectively are repugnant to the provisions of the Constitution and ultra vires the State Legislature. At any rate, this power of seizure and confiscation under Sections 28 and 29 of the Act, it is contended, is not ancillary or incidental to the power to levy tax on sale or purchase of goods and such a power is not in furtherance of the object of checking evasion of tax. It is further contended that inasmuch as no sale is involved, the confiscation of goods which are not accounted for in the registers and account books maintained by the dealers is ultra vires.
3. These contentions could have been easily disposed of because a Bench of this Court consisting of Chandrasekhara Sastry and Krishna Rao, JJ., in K. S. Papanna v. Deputy Commercial Tax Officer [1967] 19 S.T.C. 506 had held that the power to levy a tax includes all incidental powers to prevent the evasion of such tax and that the power to seize and confiscate goods is only by way of punishment or penalty, which is intended to operate as the most effective deterrent against tax evaders and it is therefore ancillary or incidental to the power to levy tax on the sale of goods and falls within the ambit and scope of the legislative power conferred on the State Legislature under entry 54 of List II of the Seventh Schedule to the Constitution of India. It was further held that so long as the steps or measures taken by the State Legislature are directed towards the achievement of the object of prevention of evasion of tax, they come within the scope of ancillary powers irrespective of the question whether it may be necessary or not for the Legislature to impose a drastic provision or only a lenient punishment. In this view Section 28(6) and Section 29(3) of the Act were held to be not ultra vires the State Legislature. The Bench also took the view that the procedure laid down under the Andhra Pradesh General Sales Tax Rules, 1957, for seizure and confiscation of goods does not impose any unreasonable restrictions or confer any untenable or unguided power in the hands of the officers of the department and, therefore, does not infringe Articles 14 and 19(1)(f) and (g) of the Constitution.
4. However, the learned Advocates for the petitioners contend before us firstly that the provision of Section 28(6) offends Article 14 of the Constitution in that it contemplates seizure and confiscation of goods in respect of persons who make an attempt to evade the payment of tax and while in respect of persons who are actually found to have evaded, the maximum penalty prescribed under Section 14 of the Act is only five times the tax, the power under Section 28(6) is much more drastic and onerous than the power under Section 14. The assessees who attempt to evade the tax and the assessees who actually evade the lax, it is submitted, are in the same position by circumstances or attainment, but the Act seeks to treat them differently, and that the classification is not based on real and substantial distinction, nor is there any nexus between the basis of the classification and the object of the Act. Secondly, it is contended that the provisions of Section 29(3) and (4) similarly offend Article 14 as these provisions authorise levy of penalty equal to five times the tax leviable on the goods and confiscation on failure of payment of the penalty in respect of persons who make an attempt to evade the payment, which power is more drastic and onerous than the one contained in Section 14, which prescribes a penalty for actual evasion, that Sections 29(3) and (4) are repugnant to the scheme of the Act as it provides for the levy of penalty with reference to the tax leviable on the goods even before the event of sale takes place, that they offend Article 19(1)(f) and (g) and that both Sections 28(6) and 29(3) and (4) are expropriatory and confiscatory in nature. As these points were not raised in the petitions, permission was sought for and granted to amend the petitions, and accordingly, verified petitions raising these points have been filed.
5. After the decision of the Bench in Papanna's case, [1967] 19 S.T.C. 506 the question whether the power to confiscate goods which are found on search and which are not entered in the account books of the dealer is an ancillary power necessary for the purpose of stopping evasion of payment of sales tax, was raised before their Lordships of the Supreme Court in Commissioner of Commercial Taxes v. R.S. Jhaver [1967] 20 S.T.C. 453. But their Lordships, even though they noticed the decision of this Court in Papanna's case [1967] 19 S.T.C. 506 were not inclined to decide that question because they were striking down the provisions of Sub-section (4) of Section 41 of the Madras General Sales Tax Act, 1959, which they had to consider and which empowers the recovery of tax on goods found in the dealer's office etc., i.e., even before its sale which is the taxable event, as repugnant to the entire scheme of the Act and therefore void. However, it was pointed out by their Lordships that there was no provision similar to the second proviso to Section 41(4) of the Madras General Sales Tax Act in the Andhra Pradesh Act and they did not therefore propose to express any opinion on the correctness of the decision of the Andhra Pradesh High Court in Papanna's case [1967] 19 S.T.C. 506.
6. Sri Rama Rao contends that in view of these observations it must be assumed that their Lordships were indicating that the correctness of the decision in Papanna's case [1967] 19 S.T.C. 506 was open to doubt. We can find no justification for this assumption. Section 41(4) of the Madras General Sales Tax Act, which was being considered by their Lordships, is as follows :
Any such officer (i.e., any officer empowered by the Government) shall have power to seize and confiscate any goods which are found in any office, shop, godown, vessel, vehicle, or any other place of business, or any building or place of the dealer, but not accounted for by the dealer in his accounts, registers, records and other documents maintained in the course of his business :
Provided that before ordering the confiscation of goods under this sub-section, the officer shall give the person affected an opportunity of being heard and make an inquiry in the prescribed manner :
Provided further that the officer ordering the confiscation shall give the person affected option to pay in lieu of confiscation-
(a) in cases where the goods are taxable under this Act, in addition to the tax recoverable, a sum of money not exceeding one thousand rupees or double the amount of tax recoverable, whichever is greater; and
(b) in other cases, a sum of money not exceeding one thousand rupees.
7. It may be stated that the second proviso to Sub-section (4) of Section 41 was added on 1st April, 1961, and under Clause (a) the penalty leviable was in addition to the tax recoverable, so that the proviso contemplates tax being levied before the sale had taken place, and that was why the provision was struck down. It is contended before us that their Lordships did not consider the question whether payment of tax is attracted at the purchase point, in which case the goods found in the custody unaccounted for would have already attracted tax. We are, however, not called upon to interpret Section 41(4). But as pointed out by their Lordships, there is no proviso like the second proviso to Section 41(4) in Section 28 of the Andhra Pradesh Act, and for that reason they did not propose to express any opinion as to the correctness of the decision in Papanna's case [1967] 19 S.T.C. 506. Nor do we think it necessary to consider that question, because as we have stated, it is already concluded by the decision of a Bench of this Court and we see no reason for reopening it by reference to a larger Bench. As, however, the Bench in Papanna's case [1967] 19 S.T.C. 506 did not address itself to the question whether Sections 28(6) and 29(3) and (4) violate Article 14 for the reasons mentioned earlier, we are invited to consider and decide that question.
8. The impugned provisions of Sections 28(6) and 29(3) and (4) are as follows:
Section 28(6): 'Any such officer shall have power to seize and confiscate any goods which are found in any office, shop, godown, vehicle, vessel or any other place of business or any building or place of the dealer, but not accounted for by the dealer in his accounts, registers and other documents maintained in the course of his business :
Provided that before taking action for the confiscation of goods under this sub-section, the officer shall give the person affected an opportunity of being heard and make an inquiry in the prescribed manner.
9. Section 29(3): 'If any goods which are under transport by a goods vehicle or a boat are not covered by a way bill issued by the person who consigns the goods in such form and containing such particulars as may be prescribed, the officer-in-charge of the check-post or the barrier or the officer empowered under Sub-section (2) shall have power to seize the goods and to levy-
(i) in the case of goods exempted under Section 8 or Section 9, a penalty not exceeding rupees five hundred where the non-production of the way bill was wilful;
(ii) in the case of goods other than those exempted under Section 8 or Section 9, a penalty equal to five times the tax leviable on the goods where the non-production of the way bill was wilful:
Provided that before taking action for the levy of penalty as aforesaid, such officer shall give the person affected an opportunity of being heard while making an inquiry in the manner prescribed.
10. Section 29(4): 'Where the penalty levied under Sub-section (3) is paid, the goods so seized shall be released, but where such penalty is not paid by the person concerned within the time prescribed, such officer shall confiscate the goods so seized.'
11. It may be stated that Section 25 provides that every person licensed or registered under the Act, every dealer liable to get himself registered under the Act and every other dealer who is required so to do by the prescribed authority by notice served in the prescribed manner, shall keep and maintain a true and correct account in any of the languages specified in the Eighth Schedule to the Constitution or in English, showing such particulars as may be prescribed, and different particulars may be prescribed for different classes of persons or dealers. It is the contravention of this provision that will attract seizure under Sub-section (6) of Section 28 as a penalty for not maintaining true and correct accounts and/or by not entering the goods which should have been entered therein. If the duty imposed on every person or dealer to maintain true and correct accounts and enter therein all the particulars that are prescribed, namely, the nature of the goods, weight, etc., is not fulfilled, the Legislature has prescribed a penalty, by authorising confiscation of the goods not accounted for in the account books. The provision is designed to prevent evasion of tax, and is a class by itself and cannot be compared with Section 14 which deals with a case where a turnover has escaped assessment by non-inclusion in the returns. This confiscation cannot, as urged by Sri Rama Rao, be a penalty for an attempt at evasion of payment of tax and therefore is far more stringent than the punishment provided under Section 14 in the case of actual evasion. The power of seizure and confiscation, as held by the Bench in Papanna's case [1967] 19 S.T.C. 506 is ancillary and incidental to the power to levy a tax and is a necessary power for the enforcement of the provisions of the Act. Their Lordships of the Supreme Court in Abdul Quader and Co. v. Sales Tax Officer [1964] 15 S.T.C. 403 referred to by the Bench in Papanna's case [1967] 19 S.T.C. 506 observed : 'All powers necessary for the levy and collection of the tax concerned and for seeing that the tax is not evaded are comprised within the ambit of the legislative entry as ancillary or incidental.' The power to confiscate for non-compliance with the provisions of the Act, in our view, is in the nature of a punishment, and bears no relation to the actual evasion of tax. It is quite possible that apart from this punishment the assessee may, in cases, where as a result of keeping unaccounted for goods is found to have evaded the tax, be liable to penalties under Section 14. It would not therefore be right to construe Section 28(6) as a penalty similar in nature to that contained in Section 14, imposed for the mere attempt at evasion.
12. The cases cited by Sri Rama Rao in support of his contention that the Act discriminates persons who attempt at evasion and persons who have actually evaded, viz., Mohta & Co. v. Visvanatha Sastri [1954] 26 I.T.R. 1, Meenakshi Mills v. Visvanatha Sastri [1954] 26 I.T.R. 713 and S.C. Prashar v. Vasantsen [1963] 49 I.T.R. 1 are all cases in which the Supreme Court struck down the concerned provisions which sought to make a discrimination between the same or similar class of persons, unlike in this case. The first of the cases was dealing with income-tax evaders, specified in Sub-section (4) of Section 5 of the Taxation on Income (Investigation Commission) Act, 1947, and Section 34 of the Indian Income-tax Act, 1922. These two classes of persons, their Lordships held, have similar characteristics and similar properties, the common characteristics being that they are persons who have not truly disclosed their income and have evaded payment of tax on income. Nonetheless, there was a discriminatory procedure prescribed for dealing with these two types of evaders, in that persons against whom proceedings are taken under Section 5(4) of the Taxation on Income (Investigation Commission) Act were deprived of the right of appeal, second appeal and revision conferred by Sections 31, 32 and 33 of the Indian Income-tax Act on assessees whose cases are dealt with under the procedure of Section 34 of the Income-tax Act, and therefore, it was a discrimination coming within the inhibition of Article 14. The second of the cases was also under the Taxation on Income (Investigation Commission) Act, 1947, arising under Section 5(1) whereunder a drastic procedure was prescribed for dealing with persons whose cases had been referred before 1st September, 1948, leaving other tax evaders to be dealt with under the ordinary law. This was held to be a clear discrimination, for the reference of the case within a particular time has no special or rational nexus with the necessity for drastic procedure. Evaders of income-tax whether before 1st September, 1948, or subsequent to that date have been held to be in the same class comprising of those unsocial elements in society who made substantial profits and had evaded payment of tax. The last of the cases is also of a similar nature arising under the Income-tax Act, where there was discrimination between the same class of persons.
13. It may be true that the punishment of confiscation may be far severe and very drastic than the penalty levied in the case of actual evasion. But as Sri Venkatappaiah Sastry on behalf of the learned Government Pleader has contended, the evasion may have been in fact in a far larger scale than the value of the goods confiscated on perhaps one occasion would represent, and that the policy of the Legislature was to provide for appropriate punishment to prevent evasion or make it not worth while for dealers to evade. Accordingly, he contends that Sections 25 and 28 and Rules 45 and 48 of the Rules made under Section 39 read together would make it clear that every dealer must account for the goods that are found in his premises, and when a search is made under the provisions of Section 28, if certain goods were found unaccounted for, the power of confiscation can be exercised, which power can only be exercised when there is evasion or an attempt at evasion as provided in Rule 48. Further it is also seen that the discretion to confiscate wholly or in part is itself subject to appeal and revision and is not unguided. The provision giving the dealer a right of appeal is a sufficient safeguard against arbitrary discrimination.
14. There is force in this contention because the provisions in Sections 28(6) and 29(3) and (4) are regulatory provisions designed to prevent whether actual or attempted evasion of tax and is distinctly a class by itself. Of course, as we have already stated, the Legislature has been held to have ancillary or incidental power to legislate in this regard. Once it has the power, it alone has the wisdom to determine what measures would be necessary to deter the evasion of tax. The tax on sale of goods as well as excise duty or customs duty are indirect taxes, unlike taxes on property or income. The taxable event in the case of sale of goods is on the sale, while for excise it is the tax on manufacture and under the Sea Customs Act, it is the duty on the movement of goods across the customs barriers. The confiscation of the goods for contravention of the provisions of the Excise Act or the provisions of the Sea Customs Act for preventing the evasion of the respective taxes, though they are not direct taxes on the goods, would be within the competence of the Legislature and is not ultra vires or offend the provisions of the Constitution. In the reference under Article 143(1) of the Constitution, In re Sea Customs Act, 1878, Section 20(2), A.I.R. 1963 S.C. 1760 referred to in Papanna's case [1967] 19 S.T.C. 506 Sinha, C.J., Gajendragadkar, Wanchoo, Shah and Ayyangar, JJ., held that the duties of excise as well as customs are indirect taxes unlike taxes on property or income which are direct. In Collector of Customs v. N. Sampathu Chetty (1962) 1 S.C.J. 68 while considering the constitutional validity of the amended Section 178-A of the Sea Customs Act (8 of 1878), whereby goods are seized in the reasonable belief that they are smuggled goods and that the burden of proof is on the person from whose possession they are seized, Rajagopala Ayyangar, J., delivering the judgment also considered the provisions of Section 8 of the Foreign Exchange Regulation Act wllereunder the penalty for contravention of Sections 18 and 19 was the confiscation of goods. It was observed that the previous decision of their Lordships in Babulal Amthalal Mehta v. The Collector of Customs, Calcutta (1957) S.C.J. 828 in which the constitutional validity of Section 178-A was considered, had held that it is not discriminatory in character and does not violate the equal protection of laws guaranteed in Article 14 of the Constitution. The further question whether Section 178-A violates Article 19(1)(f) and (g) was not considered in the previous case. As such the reasonableness under clauses (5) and (6) of Article 19 was therefore considered by reference to English and American cases and it was held that it did not in any way contravene the guarantee contained in that article. It may be noted that goods specified in that section and found on the person from whose possession they were seized could be confiscated unless the person concerned could prove that they are not smuggled. The provision imposing such a drastic action has been held not to be either discriminatory or violative of Article 14 and was considered to be a reasonable restriction as not to fall within the mischief of Article 19(1)(f) and (g). At page 87, after considering the deleterious effects of smuggling, Rajagopala Ayyangar, J., said : 'If therefore for the purpose of achieving the desired objective and to ensure that the intentions of Parliament shall not be defeated a law is enacted which operates somewhat harshly on a small section of the public, taken in conjunction with the position that without a law in that form and with that amplitude smuggling might not be possible of being effectively checked, the question arises whether the law could be held to be violative of the freedom guaranteed by Article 19(1)(f) and (g) as imposing an unreasonable restraint. That the restrictions are in the 'interest of the general public' is beyond controversy. But is the social good to be achieved by the legislation so disproportionately small that on balance it could be said that it has proceeded beyond the limits of reasonableness We would answer this in the negative.'
15. In our view similar considerations would certainly justify us in holding that the prevention of evasion or attempted evasion of tax is the object which the Legislature is justified in achieving by the imposition of such deterrent as would be considered necessary for achieving that object. We do not think that the penalty of confiscation is such an unreasonable restriction, nor does it offend Article 14 because it is a class by itself and there is no discrimination as already stated. A reference to Rules 45 and 48 would show that every dealer whose turnover is less than Rs. 40,000 per year shall keep and maintain a true and correct account in any language to show the value of the goods produced, manufactured etc. and the names and addresses of each of the persons from whom goods were purchased, supported by a bill, and the descriptive and quantitative particulars of the goods in case they are not bought but received into or found in or issued from the place of business or a godown of the dealer with the names and addresses of the owners supported by necessary vouchers and the circumstances under which they are received or kept or issued. Similarly every dealer whose total turnover a year is not less than Rs. 40,000 has to keep a true and correct account with all the particulars stated therein. Every dealer carrying on business in the goods specified in the First, Second and Third Schedules whose total turnover exceeds Rs. 7,500 and every other dealer whose turnover exceeds Rs. 20,000 in a year has to issue a bill or cash memorandum in respect of every sale involving an amount of Rs. 5 or more stating all the particulars specified. Under Sub-rule (4) every person who consigns goods by goods vehicle or boat shall make out a way bill in Form X in triplicate and issue the duplicate and triplicate thereof duly signed by him, his manager or agent to the owner or other person in charge of the goods vehicle or boat. Exception is in the case of transporting of household or other goods intended for his own use. Under Sub-rule (4-B) every dealer is liable to maintain a true and correct account under Section 25, and who is not required to issue bills under Clause (a) of Sub-rule (2) shall make an entry in the accounts maintained in the course of business of the amount of each sale, irrespective of its quantum. It is unnecessary to give the other particulars, except to say that this rule provides for the fulfilment of certain requirements in furtherance of Sections 25, 26 and 27 by persons dealing with goods whether carrying on business in them or transporting them. Rule 48 made pursuant to Section 39(f) deals with the goods found by an officer authorised under Section 28 of the Act in certain places specified therein and the seizure and release of the same. Sub-rule (4) of Rule 48 requires the officer to make an enquiry after giving the owner of the goods an opportunity of being heard by confiscating the whole or any part of the goods seized if he is satisfied that there is evasion or an attempt to evade tax thereon (underlining ours*) and Sub-rule (5) authorises the sale of the goods confiscated. Under Sub-rule (6) if on enquiry under Sub-rule (4) it is considered by the officer who seized the goods that the confiscation is not warranted or if any order of confiscation is set aside or modified, such goods shall be returned to the owner or any person authorised by him if they had not been sold in public auction. Sub-rule (7) deals with the confiscation order passed in respect of any goods, the ownership of which was not ascertainable before the order is passed and states that such owner of the goods or any person on his behalf may appear before the officer who ordered the confiscation and satisfy him with relevant records regarding the bona fides of the goods in question and regarding the reasons for his non-appearance. If the officer has been satisfied that there is no evasion or attempt at evasion of tax, he may order return of the goods, or the refund of the sale proceeds if such goods have already been sold. These rules would show that there is a power vested in the officer seizing the goods, to confiscate the whole or any part of them according to the circumstances of each case and that the dealer should be given an opportunity to show cause why the goods should not be confiscated. Any order of confiscation passed thereafter is for both evasion or attempt at evasion of tax by not accounting for the goods as required under the Act. Every order passed is appealable under Section 19 and is subject to further appeal to the Appellate Tribunal or revision to the High Court. Apart from these, there is also a revision provided to the Board of Revenue. These provisions would safeguard even the orders passed under Section 29(3) and (4) which makes a distinction between the non-production of the way bills (sic) wilfully and of the way bills for unexempted goods. In respect of the former, the penalty is not exceeding Rs. 500 while in respect of the latter a penalty equal to five times the tax leviable on the goods can be imposed, on payment of which the goods seized have to be released; but, if such penalty is not paid within the time specified, the goods shall be confiscated. As already stated, it was contended that there is difference between these provisions and Section 14; but on a consideration we find that this has nothing to do with Section 14 which is in respect of the actual tax evaded, while these provisions are for prevention of evasion. It was again contended by Sri Rama Rao that the Commercial Tax Officer has not been clothed under Section 29(3) and (4) with any discretion like the one under Section 14 for levying penalty up to five times, but has perforce to levy the penalty of five times and as such there is discrimination. Once we have decided that the provisions of Sections 28 and 29 deal with different persons and different situations, there can be no question of discrimination. In fact, we are inclined to think that the Legislature has definitely imposed severe punishment for wilful non-production of way bills. In the case of exempted goods, it is stated that a penalty not exceeding Rs. 500 can be levied vesting a discretion in the concerned officer because it is more in the nature of a technical offence. In the case of Tika Ramji v. State of U.P. A.I.R. 1956 S.C. 676 Bhagwati, J., dealing with Section 15 of U.P. Sugarcane (Regulation of Supply and Purchase) Act, observed: 'It will be thus seen that the powers given to the Cane Commissioner under Section 15 are well defined and have got to be exercised within the limits prescribed after consulting the factories and the Canegrowers' Co-operative Societies...and any order made by the Cane Commissioner thereunder is liable to an appeal to the State Government at the instance of the party aggrieved [vide Section 15(4)]. The same is the position in regard to the orders made by the Cane Commissioner in the course of his management and supervision of the Canegrowers' Co-operative Societies and any order made by him in regard thereto is subject to appeal to the State Government at the instance of the party aggrieved (vide Rule 63). If this is the position, it cannot be urged that wide powers are conferred on the Cane Commissioner which can be used by him in a discriminatory manner so as to violate the fundamental right guaranteed under Article 14.'
16. These observations apply with equal force to the contentions urged by Mr. Rama Rao. In our view, the provisions of Sections 28(6) and 29(3) and (4) are neither violative of Article 14 or 19(1)(f) and (g).
17. The contention that the provisions are expropriatory and violate Article 31 of the Constitution is without substance, as there is no acquisition of the property by the State, the confiscation of the goods being by way of imposition of penalty under the law. Article 31(5) also states that nothing in Clause (2) shall affect the provisions of any law that the State may make for the purpose of imposing or levying any tax or penalty. For this reason also the provisions are immune from attack on the ground that Article 31 is violated.
18. Relying on the decision of the Supreme Court in Commissioner of Commercial Taxes v. R. S. Jhaver [1967] 20 S.T.C. 453 it is contended that Section 29(3) and (4) are ultra vires as penalty is imposed even before the sale takes place. It is to be noted, however, that the provisions of Section 29(3) and (4) are different from those of Section 41(4) of the Madras General Sales Tax Act which was the subject of consideration by the Supreme Court. Under that Act, the officer is empowered to levy penalty in addition to the tax recoverable. The Supreme Court construing this as a power first to levy tax recoverable and penalty in addition to it, held that the levy of tax prior to the taxable event, namely sale, is ultra vires.
19. Under Section 29(3) and (4), however, there is no power to levy any tax. The mere fact that the penalty is computed at five times the tax does not mean that there is levy of tax under that section. Hence the decision of the Supreme Court has no application.
20. It is also contended by Mr. Rama Rao that under Section 30 any person who wilfully acts in contravention of the provisions of the Act or the Rules made thereunder shall on conviction be liable to be punished with a fine which may extend to two thousand rupees. It is submitted therefore that a person who acts in contravention of the provisions of Sections 28(6) and 29(3) and (4) is liable to double punishment, namely, one under Section 30 and the other by way of confiscation or penalty as prescribed in those sections. This contention also is without substance. As pointed out in Sesha Reddy v. Excise Superintendent (1959) 2 An. W.R. 426 the imposition of penalty is a different kind of sanction from criminal sanction. They are two separate distinct remedies. The objectives of the two sanctions are different. They are independent remedies and both of them can be availed of.
21. In the result, these writ petitions are dismissed with costs. Advocate's fee Rs. 50 in each.