M/S. Best Granites vs. The Intelligence Officer

Facts

The appellant, M/s. Best Granites, challenged a penalty order (Ext.P1) issued by the Intelligence Officer under Section 67 of the Kerala Value Added Tax Act, 2003. The appellant filed a statutory appeal before the third respondent (Deputy Commissioner Appeals) and simultaneously filed a writ petition seeking a direction to the Appellate Authority to hear and pass orders on the appeal, and also to stay the recovery of the penalty amount pending appeal. The appellant also moved an interim application for stay before the Appellate Authority. The learned Single Judge disposed of the writ petition by directing the Appellate Authority to consider the stay petition expeditiously, preferably within three months, and stayed recovery proceedings for three months to facilitate this. The appellant filed this writ appeal against the Single Judge's order, contending that the appeal itself should have been directed to be disposed of on merits, citing a previous High Court judgment quashing a similar penalty order.

Held

The High Court dismissed the writ appeal. The Court held that the learned Single Judge was correct in not considering the legality or sustainability of the penalty order on its merits, as the appellant had chosen to avail the statutory remedy of appeal. The Court found that an equitable relief was granted by directing the Appellate Authority to dispose of the stay petition expeditiously and by staying recovery proceedings for three months to facilitate this. The Court observed that there was no illegality, error, or impropriety in the impugned judgment warranting interference. However, the Court clarified that the appellant was at liberty to convince the appellate authority about the merits of the appeal and pray for a hearing of the appeal itself, pointing out the judgment in WP(C) No. 40400/2017. The Court expressed confidence that the Appellate Authority would consider the prima facie merits and the cited judgment while deciding the appeal or the stay application. No issue was expressly left undecided.

Key Issues

1. Whether the learned Single Judge erred in not directing the disposal of the statutory appeal on its merits, instead of merely directing expeditious consideration of the stay petition? (Question of law and procedure, concerning the scope of writ jurisdiction and statutory remedies). Contentions: Petitioner/Appellant: The learned Single Judge ought to have directed the disposal of the appeal on its merits, as the penalty order (Ext.P1) was unsustainable and without jurisdiction. They relied on a previous judgment of this Court in WP(C) No. 40400/2017, dated 08.06.2018, which quashed a similar penalty order. Respondent/Revenue: No specific arguments recorded for the respondents in the judgment regarding the merits of the appeal or the Single Judge's order.