The Exclusive Club vs. The Deputy Commissioner
Original PDF →Facts
The petitioner, The Exclusive Club, a society registered under the Societies Registration Act, has approached the High Court of Kerala. The club has not filed returns under the Kerala General Sales Tax Act. Consequently, proceedings have been initiated against the petitioner under Section 45A of the said Act. The petitioner contends that it may be exempted from payment of sales tax, but this is distinct from the obligation to file returns. The revenue initiated proceedings under Section 45A for the failure to file returns. The petitioner relied on a judgment from the State of West Bengal and others v. Calcutta Club Ltd. (2019 70 GSTR 209).
Held
The Court held that the petitioner's claim of exemption from payment of sales tax is a distinct issue from the obligation to file returns under the Kerala General Sales Tax Act. The Court found no substance in the writ petition. The reasoning was that even if the petitioner is not liable to pay tax, they are still required to file returns. Exemption from tax must be claimed within the filed returns. The judgment relied upon by the petitioner, State of West Bengal and others v. Calcutta Club Ltd., was deemed not applicable to the facts of the present case. Therefore, the Court dismissed the writ petition.
Key Issues
1. Whether the petitioner is exempted from the requirement of filing returns under the Kerala General Sales Tax Act, even if it claims exemption from payment of sales tax? Petitioner's Argument: The petitioner argued that if they are not liable to pay tax, they should not be penalized for not filing returns. They relied on the judgment in State of West Bengal and others v. Calcutta Club Ltd. (2019 70 GSTR 209) to support their claim for exemption or non-liability. Revenue's Argument: The revenue contended that the petitioner's claim of exemption from tax payment is a separate issue from the mandatory requirement of filing returns. They argued that Section 45A of the Kerala General Sales Tax Act imposes a penalty for not filing returns, irrespective of the tax liability.
Sections Cited
Section 45A
AI-generated summary — verify with the full judgment below
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH WEDNE AY, THE 17TH DAY OF JANUARY 2024 / 27TH POUSHA, 1945 WP(C) NO. 23839 OF 2023 PETITIONER/S: THE EXCLUSIVE CLUB, CIVIL STATION, CALICUT (A SOCIETY REGISTERED UNDER THE SOCIETIES REGISTRATION ACT), REPRESENTED BY ITS SECRETARY, K.M.MUSTHAFA., PIN - 673020 BY ADVS. HARISANKAR V. MENON MEERA V.MENON R.SREEJITH K.KRISHNA PARVATHY MENON RESPONDENT/S: 1 THE DEPUTY COMMISSIONER, TAX PAYER SERVICES DIVISION, KOZHIKODE NORTH, STATE GOODS & SERVICES TAX DEPARTMENT, KOZHIKODE, PIN - 673006 2 THE COMMISSIONER OF COMMERCIAL TAXES, STATE GOODS & SERVICES TAX DEPARTMENT, TAX TOWERS, KILLIPPALAM, KARAMANA, THIRUVANANTHAPURAM, PIN - 695002 3 STATE OF KERALA, REPRESENTED BY ITS SECRETARY, TAXES DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM, PIN - 695001 OTHER PRESENT: JASMINE M.M.-GP THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 17.01.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
JUDGMENT Dated this the 17th day of January, 2024 The petitioner claims to be a club of its members. The petitioner has not filed return under the provision of the Kerala General Sales Tax Act and therefore the proceedings under Section 45A has been initiated. Whether the petitioner is exempted from payment of the sales tax is a different issue than not filing the return. Section 45A of the the Kerala General Sales Tax Act has been imposed for not filing return by the petitioner. If an assessee under the provisions of the Kerala General Sales Tax has not filed the return, the penalty can be imposed under Section 45A.
The judgment relied on by the learned counsel for the petitioner reported in [2019 70 GSTR 209], State of West Bengal and others v.Calcutta Club Ltd. is not applicable to the facts of the case. The petitioner cannot claim exemption from filing the return, even if the petitioner is not liable to pay tax. Exemption has to be claimed only in the return filed by the petitioner. In view thereof, I find no substance in the writ petition. Therefore, the writ petition is hereby dismissed. DINESH KUMAR SINGH JUDGE AP
Appendix — schedule of exhibits
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.