Evm Motels PVT.LTD. vs. State Tax Officer
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Cause title — parties, addresses and appearances
JUDGMENT Heard Sri. S. Anil Kumar, the learned counsel for the petitioner and Dr.Thushara James, the learned Government Pleader.
The petitioner a registered dealer under Kerala Value Added Tax Act, 2003 (for short, the Act) received notice dated 14.11.2018 from the respondent for the assessment years 2015-16 and 2016-17 proposing to impose penalty of Rs.18,34,870/- (Rupees Eighteen lakh thirty four thousand eight hundred and seventy only) on the petitioner under Section 10 A of the CST Act. The petitioner in response to the show cause notice dated 14.11.2018 has submitted Ext.P3 reply dated 26.12.2018. The said exercise of issuing notice and receiving reply resulted in Ext.P4 penalty order.
The petitioner challenges Ext.P4 penalty order primarily on the ground that Ext.P4 did not consider even a syllable of the objection raised by the petitioner and the -3- consideration of reply by an Assessing Officer in this regard if is accepted in Judicial Scrutiny. The very purpose and object of show cause notice, reply, consideration etc. are all defeated. The existing exercise would become a shallow inquiry undertaken by the respondent. The petitioner reserves right to raise objections on merits of the findings recorded in Ext.P4 for the present prays for setting aside Ext.P4 order on the above ground alone and remit the matter to sole respondent for reconsideration.
To appreciate the objection raised by the petitioner, the operative portion of Ext.P4 is excerpted and which reads thus:- The dealer filed reply on 26.12.2018 objecting the proposals. I have meticulously verified the reply and rejected to finding no valid grounds. In the circumstances the assessment for penalty u/s. 10A of the CST Act 1956 is completed as under. ORDER NO.32151591461/2016-17 dated 27.02.2019 Total turnover involved in the C form issued Rs.97,85,976.00
-4- Tax due @ 14.5% Rs.14,18,967.00 Less CST paid Rs.1,95,720.00 ----------------- Differential amount due Rs.12,23,247.00 Penalty amount (12,23,247 x 1.50 Rs.18,34,870.00 Interest due @ 23% Rs.4,22,020.00 ----------------- Total due Rs.22,56,890.00 =============== This amount shall be paid as specified in the demand notice issued. State Tax Officer, Kothamangalam
I have perused the reply and also noted the manner in which reply of petitioner is considered and penalty order is passed against the petitioner in Ext.P4. Ext.P4 by any liberal standard is unsustainable and liable to be set aside. Ext.P4 apparently bears no semblance of reference to objection raised by the petitioner or consideration resulting in a conclusion.
Accordingly the order is liable to be set aside and matter remitted to respondent for consideration and disposal in accordance with law. This Court refrains from laying a path on -5- which the assessing officer is required to tread while dealing with the reply given by the petitioner. It would suffice to note that the respondent adverts to objections raised on facts and to the extent required, refers to the precedents on which the assessee is relying on and thereafter record his findings. The writ petition is ordered as indicated above. S.V.BHATTI JUDGE JS
-6- APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 COPY OF CERTIFICATE REGISTRATION EXHIBIT P2 COPY OF NOTICE DATED 14-11-2018 ISSUED BY THE RESPONDENT U/S. 10A OF THE CST ACT FOR THE YEAR 2016-17 EXHIBIT P3 COPY OF REPLY DATED 26-12-2018 ADDRESSED TO THE RESPONDENT. EXHIBIT P4 COPY OF ORDER DATED 27-02-2019 ISSUED BY THE RESPONDENT UNDER SEC. 10A OF THE CST ACT FOR THE YEAR 2016-17.
Reproduced from the public record of the Kerala High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.