Jose Paul vs. State Tax Officer - Kerala High Court, 28 June 2018

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU THURSDAY, THE 28TH DAY OF JUNE 2018 / 7TH ASHADHA, 1940 WP(C).No. 20949 of 2018 PETITIONER(S) JOSE PAUL, PROPRIETOR, ALPHA AGENCIES, CHAPPARA, KODUNGALOOR-680664, THRISSUR DISTRICT. BY ADV.SRI.TOMSON T.EMMANUEL RESPONDENTS: 1. STATE TAX OFFICER, FORMERLY: COMMERCIAL TAX OFFICER, STATE GOODS AND SERVICES TAX DEPARTMENT, MINI CIVIL STATION, KODUNGALOOR-680664. 2. ASSISTANT COMMISSIONER (APPEALS), COMMERCIAL TAX COMPLEX, POOTHOLE, THRISSUR-680004. 3. THE ASSISTANT SECRETARY, VALUE ADDED TAX APPELLATE TRIBUNAL, SALES TAX COMPLEX, THEVARA, COCHIN-682015. 4. ASSISTANT COMMISSIONER OF STATE TAX, MINI CIVIL STATION, IRINJALAKUDA-680121. 5. BRANCH MANAGER, ICICI BANK, PADINJARE NADA, KODUNGALOOR-680664. 6. BRANCH MANAGER, STATE BANK OF INDIA, NEAR MINI CIVIL STATION, KODUNGALOOR-680664. R6 BY ADV. SRI.A.KUMAR, SC, SBI R BY GOVERNMENT PLEADER R BY SRI.LAL K.JOSEPH R BY SRI.AMAL GEORGE, SC, SBI THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28-06-2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No. 20949 of 2018 (P) APPENDIX PETITIONER(S)' EXHIBITS EXHIBIT P1 COPY OF ORDER DATED 31-01-2016 COMPLETED U/S.25(1) FOR THE YEAR 2011-12 BY 1ST RESPONDENT. EXHIBIT P2 COPY OF 1ST APPEAL DATED 14-12-2016 SUBMITTED BEFORE 2ND RESPONDENT AGAINST EXT.P1. EXHIBIT P3 COPY OF 1ST APPELLATE ORDER DATED 15-04-17 PASSE BY 2ND RESPONDENT IN JUSTIFYING EXT.P1. EXHIBIT P4 COPY OF 2ND APPEAL DATED 17-07-2017 SUBMITTED BEFORE 3RD RESPONDENT AGAINST EXT P3 ORDER. EXHIBIT P5 COPY OF AFFIDAVIT AND STAY PETITION DATED 17-07-17 SUBMITTED BEFORE 3RD RESPONDENT ALONG EXT.P4. EXHIBIT P6 COPY OF JUDGMENT DATED 20-07-2017 UN WP(C)NO.24104 OF 2017 PASSED BY THIS HON'BLE COURT IN STAYING FURTHER RECOVERY STEPS

PURSUANT TO EXT P1 ORDER. EXHIBIT P7 COPY OF CONDITIONAL STAY ORDER PASSED BY 3RD RESPONDENT IN EXT P5 STAY PETITION. EXHIBIT P8 COPY OF CHALLAN DATED 24-01-2018 COUNTER SIGNED BY 4TH RESPONDENT IN REALIZING TAX AND INTEREST RS.90,884/- ALONG WITH COLLECTION CHARGE OF RS.4,619/-. EXHIBIT P9 COPY OF CERTIFIED COPY OF SECURITY BOND IN FORM NO.6 FOR RS.1,86,837/- INSISTED BY 1ST RESPONDENT, SUBMITTED BY PETITIONER, IN FULFILLING THE CONDITION IN EXT P7 ORDER. Css/

Dama Seshadri Naidu, J. --------------------------------------- WPC No.20949 of 2018 --------------------------------------- Dated this the 28th day of June 2018 JUDGMENT The petitioner is a registered dealer under KVAT Act. He filed monthly returns for the assessment years 2011-2012. Later, the first respondent assessed the escaped turnover under Section 25(1) of the KVAT Act. Then, for various reasons, the petitioner suffered Ext.P1 order, which he appealed against and invited Ext.P3 order from the Appellate Assistant Commissioner. Eventually, he has filed Ext.P4 second appeal before the VAT Appellate Tribunal, Ernakulam, the third respondent.

In fact, the third respondent entertained the petitioner's stay petition and stayed further proceedings on the condition of the petitioner’s depositing 30% and providing security for the balance, as seen from Ext.P7. 3. Now, the petitioner contends that though he complied with the Ext.P7, the respondents have continued with their

WPC No.20949 of 2018 2 coercive steps and have, in fact, appropriated the entire amount lying in his account with the sixth respondent bank, the garnishee. The petitioner also complains that the authorities have frozen his account, disabling him from carrying on his business activities.

The learned counsel for the petitioner submits that unless this Court judicially intervenes, the petitioner's business will suffer irreparable loss and damage.

In response, the learned Government Pleader submitted that the petitioner did not comply with Ext.P7 conditional order granted by the second appellate tribunal. According to him, the petitioner paid 30% of the amount and provided security beyond the time stipulated in the order. So the authorities proceeded.

The learned counsel for the sixth respondent bank submits that, contrary to what the petitioner has stated, the Bank has not frozen the petitioner’s account. According to her, acting on the authorities’ directions, the respondent Bank transferred to the Department the funds lying in the petitioner's account. She has also submitted that the respondent Bank has acted only on WPC No.20949 of 2018 3 the competent authorities’ directions.

This Court queried why the petitioner should not approach the second appellate Tribunal and raise all the issues, for the Tribunal is empowered to redress the petitioner's grievances. The learned counsel has submitted that the Tribunal is not “sitting” and it will take inordinate time before the petitioner could get his relief.

Heard Sri Tomson T. Emmanuel, the learned counsel for the petitioner, Sri. Anil George, the learned Standing counsel appearing for SBI, Sri Lal K. Joseph, the learned Standing Counsel appearing for ICICI Bank, and Sri Shamsudheen, the learned Government Pleader, appearing for respondents 1 to 4, besides perusing the record.

I do find force in the learned Government Pleader’s submission that the authorities may have been proceeding further only because the petitioner did not comply with Ext.P7—on time. According to the Government Pleader, the petitioner complied with the Tribunal’s conditional stay belatedly. In the meanwhile, the Department informed the revenue recovery authorities who

WPC No.20949 of 2018 4 then acted.

10.

At any rate, I reckon, the petitioner, though belatedly, complied with the direction. And now it may be harsh to let him still suffer the consequences. If the proceedings continue unabated, the very appeal before the appellate Tribunal may render itself otiose.

11.

So, in the interest of justice, I dispose of this writ petition directing the authorities to maintain status quo for three months and permit the petitioner to operate his bank account with the fifth and sixth respondents, till then. In the meanwhile, the petitioner is free to approach the Tribunal and press for appropriate reliefs. The writ petition stands disposed of. Dama Seshadri Naidu, Judge css/