Kerala High Court
Ahammed Sherief vs The Commercial Tax Officer
Author: A.Muhamed Mustaque
Bench: A.Muhamed Mustaque
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR. JUSTICE A.MUHAMED MUSTAQUE
WEDNESDAY, THE 28TH DAY OF JUNE 2017/7TH ASHADHA, 1939
WP(C).No. 26792 of 2012 (Y)
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PETITIONER(S):
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AHAMMED SHERIEF,
PROPRIETOR,
M/S PUTHANPURAYIL CRUSHERS,
CHAKAKAL, MARAMPILLY P.O.,
ALUVA.
BY ADV. SRI.C.K.THANU PILLAI
RESPONDENT(S):
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1. THE COMMERCIAL TAX OFFICER,
ALUVA. 683 101.
2. THE INTELLIGENCE OFFICER,
SQUAD NO.III,
COMMERCIAL TAXES,
ERNAKULAM-682 011.
BY SR. GOVERNMENT PLEADER SRI. C.K. GOVINDAN
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY
HEARD ON 28-06-2017, THE COURT ON THE SAME DAY
DELIVERED THE FOLLOWING:
EL
WP(C).No. 26792 of 2012 (Y)
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APPENDIX
PETITIONER(S)' EXHIBITS
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P1- TRUE COPY OF ORDER NO.ISE-111/39/07-08 DATED
26.12.2008 ISSUED BY THE 2ND RESPONDENT.
P2- TRUE COPY OF OBJECTION DATED 08.01.2010 FILED
BY THE PETITIONER BEFORE THE IST RESPONDENT.
P3- TRUE COPY OF OPTION IN FORM NO.1D DATED
08.01.2010 PRESENTED BEFORE THE IST RESPONDENT.
P4- TRUE COPY OF ORDER NO.32150748104/07-08 DATED
14.01.2010 ISSUED BY THE IST RESPONDENT.
P5- TRUE COPY OF ORDER NO.KVATA 123/2010 DATED
28.07.2010 ISSUED BY THE DEPUTY COMMISSIONER
(APPEAL) ERNAKULAM.
P6- TRUE COPY OF ORDER NO.KVATA 1598/2010 DATED
28.07.2010 ISSUED BY THE DEPUTY COMMISSIONER
(APPEAL) ERNAKULAM.
P7- TRUE COPY OF ORDER NO.32150748104/07-08 DATED
18.5.2012 ISSUED BY THE IST RESPONDENT.
P8- TRUE COPY OF ORDER NO.ISE 111/39/07-08 DATED
07.02.2012 ISSUED BY THE 2ND RESPONDENT.
P9- TRUE COPY OF ORDER NO.32150748104/07-08 DATED
27.06.2011 ISSUED BY THE IST RESPONDENT.
P10- TRUE COPY OF JUDGMENT IN W.P(C)NO.20011 OF 2011
DATED 22.07.2011.
P11- TRUE COPY OF NOTICE NO.32150748104/07-08 DATED
16.09.2011 ISSUED BY THE IST RESPONDENT.
P12- TRUE COPY OF OBJECTIONS DATED 03.10.2011 FILED
BEFORE THE IST RESPONDENT.
P13- TRUE COPY OF ORDER NO.32150748104/07-08 DATED
16.11.2011 ISSUED BY THE IST RESPONDENT.
P14- TRUE COPY OF JUDGMENT IN W.P(C)NO.11783 OF 2012
DATED 02.07.2012.
WP(C).No. 26792 of 2012 (Y)
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P15- TRUE COPY OF OBJECTION DATED 13.08.2012 FILED
BY THE PETITIONER BEFORE THE IST RESPONDENT.
P16- TRUE COPY OF NOTICE NO.32150748104/07-08 DATED
28.09.2012 ISSUED BY THE IST RESPONDENT.
P17- TRUE COPY OF OBJECTIONS DATED 10.10.2012 FILED
BY THE PETITIONER BEFORE THE IST RESPONDENT.
P18- TRUE COPY OF ORDER NO.32150748104/07-08 DATED
20.10.2012 ISSUED BY THE IST RESPONDENT.
RESPONDENT(S)' EXHIBITS
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NIL
TRUE COPY
P.S. TO JUDGE
EL
A.MUHAMED MUSTAQUE, J.
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W.P.(C).No.26792/2012
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Dated this the 28th day of June, 2017
J U D G M E N T
The petitioner, a registered dealer in metal crushing at Chalakal, Marampilly, Aluva, has approached this court challenging rejection of an application for compounding filed under Section 8 of the Kerala Value Added Tax Act, 2003. Exhibit-P18 is the order impugned. The penalty imposed was for the year 2007-2008. There were no accounts available in the place of business when the second respondent inspected the premises on 17/10/2007. Based on the final proceedings, the first respondent issued a notice proposing a taxable turnover on the basis of the inspection. The petitioner raised objection and sought permission to exercise option for compounding system for payment of tax under Section 8(b) of the KVAT Act. The option for compounding was rejected as it was not filed within time. The petitioner thereafter, filed an appeal. The appellate authority, taking note of an amendment that came into force with effect from 1.4.2009, as per the Kerala Finance Act, 2009, took a view to set aside the assessment and directed the assessing authority to consider the option for payment of WPC 26792/2012 -:2:- tax under Section 8 of the KVATAct. The amendment was incorporated by proviso to Section 16(2) of the KVATAct. It is appropriate to quote Section 16(2) of the KVATAct in this context of dispute, which reads as follows:
"16(2). If the prescribed authority after making such enquiries as it may consider necessary, is satisfied that the application is in order and that the particulars furnished therein are correct, it shall register the applicant and issue to him a certificate of registration in the prescribed format.
Provided that registration shall be deemed to have been granted with effect from the date of commencement of business irrespective of the date of application for the purpose of, -
(a) paying tax under sub-section (5) of section 6, subject to eligibility, and:
(b) opting for payment of tax under section 8 for the relevant years subject to eligibility:
Provided further that new dealers applying for registration and existing dealers having registration may avail this benefit subject to the condition that they shall pay tax under the respective provisions along with interest and will not be entitled for any refunds relating to the period prior to filing of application for registration:
WPC 26792/2012 -:3:-
Provided also that in the case of dealers against whom an offence has been detected under section 67 of the Act before filing application for registration, registration shall be granted under this sub-section subject to the finalisation of the proceedings in respect of the offence so detected." (emphasis supplied).
The amendment as above would show that, it is a one time measure, to enable new dealers as well as the existing dealers, who could not avail the benefit of payment of tax at the compounded rates by exercising option within the time fixed under Section 8. By virtue of such amendment, the dealer like the petitioner will be able to exercise such option. Admittedly, the original option exercised by the petitioner for payment of compounded tax was belated. However, by virtue of Section 16(2), the petitioner's right to exercise such option is resurrected and the assessing authority is bound to consider such option.
2. The present dispute falls on a narrow compass as to second proviso to Section 16(2) of the KVATAct. The assessing authority, as per Exhibit-P18, on finding that the petitioner has not remitted tax along with the compounding application was of the view that he was not entitled for the WPC 26792/2012 -:4:- benefit of payment of compounded tax under Section 8 of the KVATAct and rejected the compounding application.
3. Thus, the question that arises for consideration is, for invoking the benefit under second proviso to Section 16(2), whether the petitioner will have to pay tax or not?
4. As seen from the impugned order, the petitioner is liable to pay tax under Section 8 of the KVATAct as follows:
Size of Tax (Rs.) Interest as on Total (Rs.)
Machine 11.1.2010
16" x 9" 160000.00 33600.00 193600.00
14" x 4" 50000.00 10500.00 60500.00
Total: 254100.00
Admittedly, the petitioner along with the compounding application had not paid any tax. He want to convert the regular tax already paid, for payment due as contemplated under Section 8. It appears that he has only paid a regular tax of Rs.60,000/-. The learned counsel for the petitioner submits that the petitioner need to pay tax only when a provisional order is issued in Form 4D and therefore, having no such form being issued, the petitioner is not equipped to remit tax as above.
WPC 26792/2012 -:5:-
5. Having adverted to the rigour of proviso to Section 16(2) as above, I am of the view that it is a measure to entertain a belated application under Section 8. It is in that context, to enable a dealer to avail the benefit of Section 16(2), a condition was imposed that the dealer shall pay tax under Section 8 along with interest due thereon. In that view of the matter, since the petitioner had not paid tax along with interest at the time of filing the application, I am of the view that the petitioner is not entitled for the benefit. Therefore, there is no infirmity in the order impugned, warranting interference by this court. Accordingly, the writ petition is dismissed. No costs.
Sd/-
A.MUHAMED MUSTAQUE, JUDGE ms