(1) If, on examination of the goods and the records connected with the goods under transport, the officer in charge of the notified area or the officer empowered by Government under sub-section (1) of section 20A, as the case may be, has reason to suspect that the goods under transport are not covered by proper and genuine documents (in cases where such documents are necessary) or that the person transporting the goods is attempting to evade payment of tax due under the Act, he may pass an order for the unloading and detention of the goods and thereupon the owner of the goods or his representative or the driver or other person in charge of the vehicle or vessel shall unload the goods:

Provided that no order shall be passed under this sub-rule without giving such person an opportunity of being heard.

(2) The security referred to in sub-section (2) of section 29A shall be furnished in any of the ways specified in Clauses (a) to (d) of sub-rule (2) of Rule 6 or by depositing the amount with the officer referred to in sub-rule (1).

(3) The Officer accepting the security shall, after giving a proper cash receipt where security is furnished by deposit of cash or an acknowledgment where security is furnished in any other form, pass an order in writing releasing the goods and all allowing the same to be transported.

(4) (a) If the Officer to whom proceeding are submitted under-section (3) of section 29A is satisfied after inquiry that there has been no attempt to evade the tax due under the Act on the transaction in pursuance of which the goods are transported, he shall, for reasons to be recorded in writing;

(i) Order the release of the goods detained or seized, on the owner of the goods paying the expenses, if any, incurred by the officer concerned for the safe custody of the goods and incidental charges including charges for the service and publication, of the notice under sub-section (4) and (8) of section 29A and the order under Clause (d) of this sub-rule (which shall be specified in the order).

(ii) release the security (including any bond) furnished by the owner of the goods or any other person.

(b) If after conducting the enquiry the officer, finds that there has been an attempt to evade payment of tax due under the Act on the transaction in pursuance of which the goods are transported, he shall pass an order in writing imposing on the owner of the goods a penalty not exceeding twice the amount of tax attempted to be evaded as estimated by him.

(c) In an order under Clause (b) the Officer shall also specify, in cases where goods have been seized, that the goods are liable to be sold in public auction as provided in sub-section (6) and (9) of section 29A without any further notice in case the penalty is not paid within thirty days from the date of the order

(d) An order under Clause (a) or Clause (b) shall be communicated to the owner of the goods in the same manner as a notice under sub-section (4) of section 29A is to be served and also on the person who in charge of the vehicle or vessel at the time of detaining the goods.

(5) Where an order imposing penalty has been passed and the owner of the goods or his representative or the driver or other person in charge of the vehicle or vessel has paid the amount of penalty together with the expenses and other incidental charges for keeping the goods seized in custody and for the service and publication for the notice under sub-section (4) and (8) of section 29A and the order under Clause (d) of sub-rule (4) of this rule to the officer imposing the penalty, such Officer shall pass an order directing the release of the goods sized or of the security or bond furnished as the case may be.

(6) Where the penalty is not paid as provided in sub-rule (5) within the time specified in sub-section (6)

(a) If cash security has been furnished or when the goods seized have been sold under sub-section (10) of section 29A and the amount deposited in Government Treasury, the officer authorised under sub-section (3) of section 29A shall adjust the amount towards the penalty imposed and the expenses and incidental charges to be recovered and refund the excess if any;

(b) If any other security or a bond has been furnished, the officer shall take steps to realise the amount of penalty imposed from the security or the surety and adjust the same towards the penalty and expenses and incidental charges.

(7) (a) When the goods seized are to be sold in public auction as provided in sub-section (6) and (9) of section 29A the officer who imposed the penalty shall cause to be published in the notice board of his office, a list of the goods seized and intended for sale with a notice under his signature specifying the place and the day and hour at which the seized goods will be sold and shall display copies of such list and notice in more than one public place in the notified area or in or around the place in which the goods were detained as the officer may consider necessary to give wide publicity to the sale.

(b) If the value of goods exceeds one thousand rupees, copies of the list and notice shall be published in the office of the Deputy Commissioner of State Tax concerned also.

(c) No sale shall take place until after the expiration of period of fifteen days from the date on which the notice is affixed.

(d) The officer who imposed the penalty shall conduct the sale in person and the goods seized shall be made available at the place of sale:

Provided that the sale of goods referred to in sub-section (10) of section 29A may be conducted by the officer- in-charge of the notified area.

(e) At the appointed time, the goods shall be put up in one or more lots as the officer conducting the sale may consider advisable and shall be knocked down in favour of the highest bidder subject to the confirmation of the sale by the Deputy Commissioner of State Tax where the value of the goods auctioned does not exceed one thousand rupees and by the Joint Commissioner of State Tax in other cases.

(f) where the amount fetched in auction is more than the amount of the penalty due from the owner of the goods, the surplus after releasing the penalty imposed the charges for service and publication, if any, of the notice under sub-section (4) and (8) of section 29A and the order under Clause (d) of sub-rule (4) of this rule the expenses for the conduct of the sale and the expenses and other incidental charges referred to in sub-section (12) of section 29A, shall be refunded.

(g) The auction purchaser shall pay the sale value of the goods, in ready cash immediately after the sale and he will not be permitted to carry away any part of the goods until he has paid for the same in full.

(h) Where the purchaser fails to pay the sale value of the goods in ready cash the goods shall be re-sold at once and the defaulting purchaser shall be liable for any loss arising therefrom as well as the expenses incurred on the re-sale.

(i) Where on re-sale, the property is sold on a higher price than at the first sale, the difference shall be the property of the owner of goods.

(8) Notwithstanding anything contain in sub-rule (7), if the goods seized are of a perishable nature or subject to speedy and natural decay, or when the expenses of keeping them in custody are likely to exceed their value, the goods shall be sold immediately after the seizure by the officer who impose the penalty or the officer-in-charge of the notified area and the provisions of clause (a), (b) and (d) to (h) (both inclusive) of sub-rule (7) shall so far as may be apply to such sale.