Five Star Offset Printers vs. The Asst. Commissioner

Held

The Court held that the 3rd respondent had failed to take into consideration the vital aspects born out from Ext.P9, the petitioner's reply. The impugned order (Ext.P11) was based on the erroneous premise that no objections had been filed. Consequently, the Court found that all relevant aspects of the matter had not been duly considered. The Court quashed the impugned order and remitted the issue of penalty to the 3rd respondent for fresh consideration. The 3rd respondent was directed to afford the petitioner a reasonable opportunity of being heard, take into account Ext.P9, and consider any additional written submissions. Fresh orders were to be passed within 4-6 weeks. The Court noted that the petitioner could file additional written submissions within ten days of receiving the judgment. The issue of whether a certificate of ownership was mandatorily required was not explicitly decided but was implicitly part of the remittance for fresh consideration.

Facts

The petitioner, Five Star Offset Printers, purchased an uninterrupted power supply from Chennai and transported it to Kerala. The goods were accompanied by a self-declaration and an online declaration in Form 8F. However, the goods were detained by the Commercial Tax Inspector, who required a certificate of ownership in Form 16. The goods were later released upon furnishing a bond. Subsequently, the State Tax Officer initiated adjudication proceedings. The petitioner claims to have filed detailed objections (Ext.P9) on September 24, 2018. However, the State Tax Officer issued an order (Ext.P11) stating that no objections were filed and that a certificate of ownership was mandatory. The petitioner contends that this finding is incorrect and arbitrary, as evidenced by Ext.P9 and the relevant provisions of the KVAT Act and Rules.

Key Issues

1. Whether the 3rd respondent erred in holding that the petitioner did not file any objections, contrary to the evidence on record (Ext.P9)? (Question of fact and law, concerning the procedural fairness of the adjudication). 2. Whether a certificate of ownership in Form 16 was mandatorily required for the transportation of the goods in question under the relevant provisions of the KVAT Act and Rules? (Question of law, turning on Section 46(3) of the KVAT Act and Rule 58(18) of the KVAT Rules). Petitioner's contentions: The petitioner argued that Ext.P9, their detailed objections, was duly filed and received by the 3rd respondent, as evidenced by the endorsement. They contended that the 3rd respondent failed to consider these objections, proceeding on the incorrect premise that no objections were filed. This omission rendered the adjudication proceedings arbitrary and unfair. Respondents' contentions: The judgment records that the 3rd respondent stated in the impugned order that the authorized representative of the dealer had not filed any reply/documents. The Government Pleader appeared for the respondents.