Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE DR. JUSTICE A.K.JAYASANKARAN NAMBIAR & THE HONOURABLE DR. JUSTICE KAUSER EDAPPAGATH TUESDAY, THE 31ST DAY OF OCTOBER 2023 / 9TH KARTHIKA, 1945 WA NO. 1903 OF 2023 AGAINST THE JUDGMENT DATED 20.10.2023 IN WP(C) 34654/2023 OF HIGH COURT OF KERALA APPELLANT/WRIT PETITIONER:
VELAYUDHAN GOLD LLP HAVING ITS OFFICE AT ROOM NO.27/22/3, JUBILEE ROAD, PERINTHALMANNA P.O, MALAPURAM DISTRICT, KERALA 679322 (REPRESENTED BY ITS MANAGING DIRECTOR RISHIKESH K.K, AGED 27 YEARS, S/O MOHANDAS K.K, RESIDING AT KOLAVARKUNATH HOUSE, RAMAPURAM P.O MALAPURAM DISTRICT, PIN – 679321 BY ADVS.
SRI.M.P.SHAMEEM AHAMED SRI.AKHIL PHILIP MANITHOTTIYIL SMT.DANIYA RASHEED PALLIYALIL SRI.NAEEM M.M SRI.MUHAMMED FIRDOUZ A.V.
RESPONDENTS/RESPONDENTS:
1 INTELLIGENCE OFFICER, INTELLIGENCE UNIT, KOTTARAKKARA O/O THE SENIOR INTELLIGENCE OFFICER/INTELLIGENCE OFFICER OF STATE TAX, INTELLIGENCE UNIT- KOTTARAKKARA,STATE GST COMPLEX, BAPUJI NAGAR, ASRAMAM, KOLLAM, PIN – 691002 2 INTELLIGENCE OFFICER, INTELLIGNECE UNIT 3, SGST DEPARTMENT, ERNAKULAM OFFICE OF THE INTELLIGNEC OFFICER, INTELLIGENCE UNIT NO.3, ERNAKULAM SGST DEPARTMENT, KERALA 2ND FLOOR KUREEKAL BUILDING, EDAPALLY, KOCHI, PIN – 682024 3 STATE OF KERALA REPRESENTED BY ITS SECRETARY, TAX DEPARTMENT, SECRETARIAT, TRIVANDRUM, PIN - 695001
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W.A.No.1903 of 2023 BY SR GOVT.PLEADER SRI V K SHAMSUDHEEN THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 31.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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W.A.No.1903 of 2023 JUDGMENT Dr. A.K.Jayasankaran Nambiar, J.
The petitioner in WP(C).No.34654 of 2023 is the appellant before us aggrieved by the judgment dated 20.10.2023 of the learned Single Judge.
2. The brief facts necessary for the disposal of this appeal are as follows:
The appellant had approached this Court aggrieved by an order passed against him under Section 67 of the Kerala State Goods and Service Tax Act, 2017 and the Central Goods and Service Tax Act, 2017 and (hereinafter referred to as 'the SGST/CGST Act'). By the said order, a quantity of 1647.970 grams of gold was seized from him as unaccounted gold detected in the premises of M/S.Sobhana Jewellery. It was the case of the appellant before the writ court that the seized gold did not form part of the stock in trade of M/S.Sobhana Jewellery, but actually belonged to him and he had taken the said gold to the premises of M/s Sobhana Jewellery for the purposes of displaying the said gold articles in the said premises with the hope that it would be purchased by the said jewellery based on requests/demand from their customers.
The respondents did not accept the explanation provided by the
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W.A.No.1903 of 2023 appellant and proceeded to confirm the demand in the show cause notice that was issued to him. They also rejected the contention that the seizure was not legally authorized in terms of the SGST/CGST Act, 2017.
3. The learned Single Judge who considered the matter found that the search and seizure operation could not be said to be unauthorized, and thereafter, proceeded to permit the appellant to avail his alternate remedy of filing an appeal against the order impugned in the Writ Petition in terms of the provisions of the SGST/CGST Act and Rules.
4. Before us, it is the contention of Sri.Shameem Ahamed, the learned counsel for the appellant, that the learned Single Judge erred in entering categorical findings on the aspect of whether or not the seizure/confiscation of 1647.970 grams of gold from the appellant was duly authorized in terms of the SGST/CGST Act. It is his contention that while entering such a finding, the learned Single Judge did not take into account the settled law on the subject, as also the fact that the gold in question was never a part of the stock in trade of M/s Sobhana Jewellery. In the alternative, it is his case that the learned Single Judge ought not to have entered any findings on the merits of his case, and on
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W.A.No.1903 of 2023 the aspect of jurisdiction, in the judgment when ultimately what was done was as to relegate the appellant to his alternate remedy against the order impugned in the Writ Petition.
5. We have considered the submissions of Sri.M.P.Shameem Ahamed, the learned counsel for the appellant, and Sri.V.K.Shamsudheen, the learned Senior Government Pleader for the respondents and are of the view that the factual aspect as to whether the gold weighing 1647.970 grams actually belonged to the appellant or was part of the stock in trade of the M/s Sobhana Jewellery is something that will have to be ascertained by the appellate authority under the CGST/SGST Act before whom the appellant has been relegated by the learned single judge. However, we find force in the submission of the learned counsel for the appellant that in the event of it pursuing the alternative remedy of an appeal before the First Appellate Authority, the findings of the learned Single Judge on the aspect of jurisdiction/legality of the search etc., would operate against him in those proceedings. Accordingly, while we maintain the order of the learned Single Judge to the extent it dismissed the Writ Petition and relegated the appellant to his alternate remedy under the statute, we vacate the findings of the learned Single Judge in paragraph 5, 5.1 and 5.2 that hold that the authorization by the Joint Commissioner to the
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W.A.No.1903 of 2023 extent it covered the seizure of 1647.970 grams of gold was legal in terms of Section 67(2) of the SGST/CGST Act 2017.
6. The First Appellate Authority shall, while considering the appeal, independently look into the aspect of whether or not there was a valid authorization justifying the seizure of the gold from the appellant, and he shall not feel bound by the observations in paragraphs 5, 5.1 and 5.2 of the learned Single Judge referred to above.
We further make it clear that if the appellant prefers the statutory appeal directed to be filed by the learned Single Judge within an outer time limit of three weeks from today, then the Appellate Authority shall consider the same and pass final orders as above, after hearing the appellant, within a further period of one month from the date of receipt of the appeal from the appellant.
The Writ Appeal is disposed as above.
Sd/- DR. A.K.JAYASANKARAN NAMBIAR JUDGE Sd/- DR. KAUSER EDAPPAGATH JUDGE mns