Khader M. A. vs. State Of Kerala

The specific contention raised on the Kerala Finance Bill, 2020 is that the provision is for settling arrears of tax or 'any other amount due' under the Act. The appellant's liability would be an amount due under the Act, - 3 - is the contention taken.

The learned Single Judge found that in the absence of 'any arrears of tax', the Amnesty Scheme would not be workable insofar as the settlement of any amount other than what has been expressly mentioned in the scheme. It was also found that the vehicles were confiscated in the year 2015 and redemption was sought for and obtained in that year itself. Redemption being in lieu of confiscation of vehicle, the amounts due as balance of redemption fine payable cannot be seen as 'any other amount' as contemplated under the Amnesty Scheme.

We perfectly agree with the learned Single Judge. The words used in the Amnesty Scheme 'any other amounts due' under the Act has to be understood in the context of the determination of the amounts for which settlement is provided under the Scheme. Settlement of arrears of tax or any other amount due is possible only on payment of 50% or 40% of the principal amount of the tax in arrears. The attempt is to ensure that at least a portion of the tax in arrears is paid by the defaulting dealers. The amounts due, which are contemplated by settlement under the Amnesty Scheme, is definitely one relatable to the tax which are in arrears.

Again, as rightly found by the learned Single Judge, redemption fine is in lieu of compensation of the vehicle. The redemption was sought for and vehicles obtained in the year 2015. Otherwise, the vehicles would have been confiscated by the State and sold, the proceeds of which would have been deposited to the Treasury. A person who has obtained possession of the vehicle on promise to pay redemption fine, cannot wriggle out of the liability after few years by even agreeing to subsequent confiscation. The value of the vehicles by passage of time would be diminished and when redemption itself cannot be resiled from by producing the vehicles for confiscation, there is no question of any settlement being offered.

The learned Counsel for the assessee then pointed out the proviso, to argue that this would take in the redemption fine also. The proviso is only insofar as the settlement of penalty, which is not utilized or liable to be utilized for best judgment assessment, being possible under the proviso only on payment of applicable tax or penalty. Hence, when a penalty is imposed, which has not been used for assessment or which is not capable of being so used; its waiver is not automatic on the scheme being brought in. Only when the tax relating to the offence for - 5 - which the penalty is imposed has been paid up, would there be a waiver possible of such penalty. Again, the Scheme has been related and has a direct nexus to the tax dues and there could be no different conclusion drawn with respect to the meaning of 'any other amount due' under the Act, based on the proviso. We, hence, dismiss the appeal in limine, only interpreting the provisions of the bill as produced at Exhibit P11. K.VINOD CHANDRAN JUDGE T.R.RAVI JUDGE Vku/- []