FAST AND SAFE TRANSPORTS PVT. LTD. v. COMMERCIAL TAX OFFICER, KVAT CIRCLE II, ERNAKULAM; INSPECTING ASSISTANT COMMISSIONER (RECOVERY), COMMERCIAL TAXES, ERNAKULAM; DEPUTY COMMISSIONER, COMMERCIAL TAXES, ERNAKULAM

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE** **TUESDAY, THE 14TH DAY OF JUNE 2016/24TH JYAISHTA, 1938** ## **WP(C).No. 8186 of 2016 (W)** **-----------------------------------------** **PETITIONER(S) :** ## **-------------------------** **FAST AND SAFE TRANSPORTS PVT. LTD., VEEKAY TOWER, T.A.B ROAD, ERNAKULAM, KOCHI-18, REPRESENTED BY ITS DEPUTY GENERAL MANAGER, A.NIZAR** **BY ADVS. SRI.K.I.MAYANKUTTY MATHER SRI.R.JAIKRISHNA SRI.P.RAHUL** ## **RESPONDENT(S) :** ## **----------------------------** ## **1. COMMERCIAL TAX OFFICER, KVAT CIRCLE II, ERNAKULAM-682 015.** **2. INSPECTING ASSISTANT COMMISSIONER (RECOVERY), COMMERCIAL TAXES, ERNAKULAM-682 015.** ## *** ADDITIONAL R3 IMPLEADED** ## **3. DEPUTY COMMISSIONER, COMMERCIAL TAXES, ERNAKULAM- 682 015.** *** ADDITIONAL R3 IS IMPLEADED AS PER ORDER DATED 04.04.2016 IN I.A.NO. 4484 OF 2016.** **BY GOVERNMENT PLEADER SMT. LILLY.K.T** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 14-06-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** Msd. ## **WP(C).No. 8186 of 2016 (W)** ## **-----------------------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS :** - **P1 : TRUE COPY OF THE CIRCULAR NO. 25/2011 ISSUED BY THE COMMISSIONER, COMMERCIAL TAXES, THIRUVANANTHAPURAM DATED 21.11.2011.** - **P2 : TRUE COPY OF THE JUDGMENT IN W.A.NO.1399/2014 OF THIS HON'BLE COURT DATED 26.11.2014.** - **P3 : TRUE COPY OF THE ESCAPED ASSESSMENT ORDER PASSED BY THE 1ST RESPONDENT DATED 28.09.2015.** - **P4 : TRUE COPY OF THE NOTICE ISSUED BY THE 1ST RESPONDENT UNDER SECTION 25(1) FOR AY 2009-2010 DATED 23.02.2016.** - **P4(A) : TRUE COPY OF THE REPLY GIVEN BY THE PETITIONER TO EXT P4 NOTICE DATED 29.02.2016.** - **P5 : TRUE COPY OF THE NOTICE ISSUED BY THE 1ST RESPONDENT UNDER SECTION 25(1) FOR AY 2012-2013 DATED 14.01.2016.** - **P5(A) : TRUE COPY OF THE REPLY GIVEN BY THE PETITIONER TO EXT P5 NOTICE DATED 29.02.2016.** - **P6 : TRUE COPY OF THE REVENUE RECOVERY NOTICE ISSUED BY THE 2ND RESPONDENT DATED 18.02.2016.** - **P7 : TRUE COPY OF THE ORDER OF THE 3RD RESPONDENT.** ## **RESPONDENT(S)' EXHIBITS :** **//TRUE COPY//** **P.A.TO JUDGE.** Msd. **NIL** ## **A.M. SHAFFIQUE, J.** ## **-------------------------------------** W.P.(C) No. 8186 of 2016 -------------------------------------Dated this the 14[th] day of June, 2016 ## **JUDGMENT** Petitioner challenges Exts.P3, P4, P5, P6 and P7 and seeks for a direction to the first respondent not to proceed to complete the assessment proceedings as proposed in Exts.P4 and P5 for the assessment years 2009-2010 and 2012-2013. 2. Ext.P3 is an assessment order passed by the first respondent on 28.09.2015, calling upon the petitioner to pay tax for an amount of Rs.15,603/- with other dues. Petitioner has raised specific contentions with reference to the above assessment order. One is that he is not a dealer under the Kerala Value Added Tax Act, 2003 and that the initiation of proceedings is barred by limitation. During the pendency of this writ petition, Ext.P7 order was passed by the Deputy Commissioner, Commercial Taxes, by which the period of limitation for passing assessment orders has been extended in respect of the petitioner. According to the petitioner, Ext.P7 W.P.(C) No. 8186 of 2016 -2- order had been issued on 15.3.2016, when the period of limitation had already expired on 1.4.2016. The learned counsel relies upon the decision of the Apex Court in **State of** ## **Punjab and others v. Shreyans Indus Ltd etc [2016 (91)** **VST 23 (SC),** wherein the Apex Court had observed that the extension of period of limitation has to be made within the period of limitation. Ext.P4 is another notice issued under Section 25 (1) of the Kerala Value Added Tax Act, 2003, on 23.2.2016 indicating that with respect to the very same assessment year 2009-2010, the turn over has to be revised on account of receipt of other OR files. Petitioner submitted an objection to the same on 29.2.2016. By another notice dated 14.1.2016, the petitioner was served with a notice proposing assessment for the year 2012-2013, for which also the petitioner had given a reply on 29.2.2016. Ext.P6 is the revenue recovery notice issued under Section 7 of the Kerala Revenue Recovery Act, demanding an amount of Rs.26,940/-. 3. Heard the learned counsel for the petitioner and the W.P.(C) No. 8186 of 2016 -3- learned Government Pleader appearing on behalf of the respondents. 4. Primarily the contention of the petitioner is that the entire proceedings initiated by the Department is illegal, as the petitioner is not a dealer. Learned counsel for the petitioner relies upon the judgment of a Division Bench of this court in W.A.No.1399 of 2014 (Ext.P2), by which there is a finding that a transporter shall not be a dealer as defined under the Kerala Value Added Tax Act, 2003. However, Ext.P3 proceeds on the basis that the penalty proceedings had been initiated against the petitioner, on verification of the OR files, wherein it was noticed that the petitioner had transported consignments to Kerala with multiple invoices without address or PIN. Further observation is made that the bulk quantity indicates that the goods were for resale. It was further observed that the petitioner had released the goods after remitting the security and therefore, it is clear that the consignment belongs to them. Since the petitioner failed to produce the books of W.P.(C) No. 8186 of 2016 -4- account at the time of enquiry, the Commercial Tax Officer (Enquiry), Mattanchery had converted the security into penalty. On these facts, it is noticed that the ownership of the consignment lies with the petitioner and similar transactions which leads heavy loss to State Exchequer, had been carried out by the petitioner. These are the factual aspects involved in the matter. Merely for the reason that the petitioner is a transporting agent, does not enable him to contend that he is not a dealer, if the facts as narrated is substantiated. Since these are disputed facts, it cannot be adjudicated by this Court in a writ petition under Article 226 of the Constitution of India. If the petitioner has a different opinion that the goods belongs to A, B or C and sufficient documents had been produced to prove the same, such issues are to be considered in a properly constituted appeal as per the statutory format. Same is the situation, with reference to notice is issued in terms of Exts.P4 and P5. 5. Coming to the contention regarding limitation as W.P.(C) No. 8186 of 2016 -5- contended with reference to Ext.P3 order, learned Government Pleader points out that there is no bar of limitation in the light of Section 25 (2) of the Kerala Value Added Tax Act, which reads as under: “(2) The time limit mentioned in sub-section (1) shall not apply where the turnover which escaped assessment relates to any business done by such dealer as benamidar or through a benami or where it relates to a dealer, who being liable to get himself registered under this Act and the rules made thereunder, has failed to do so or where the escaped turnover is on account of the dealer having claimed any input tax credit on the basis of any bogus or forged documents.” 6. According to the learned Government Pleader, Ext.P7 had been issued by way of abundant caution. The learned Government Pleader also submits that the limitation of turnover will not apply to import purchase. Whether Section 25 (2) applies to the fact situation, is again a matter which is factual in nature and can be considered on the fact situation in the appeal. I do not think that this Court will be justified in re- W.P.(C) No. 8186 of 2016 -6- appreciating the facts to arrive at a finding as to whether the limitation can be saved in terms of Section 25 (2). 7. As far as Ext.P7 is concerned, the said order is clearly irrelevant on account of the judgment of the Apex Court in **Shreyans Indus Ltd** (supra) as the order had been issued after the period of limitation. In the result, this writ petition can be disposed of as under: (i) The right of the petitioner to prefer appeal against Ext.P3 is reserved. (ii) It shall be open for the assessment authority to complete the procedure in terms of Exts.P4 and P5 notices after giving an opportunity to the petitioner for hearing. (iii) All questions raised by the petitioner shall be considered in the properly constituted appeal/proceedings. SD/- **A.M. SHAFFIQUE JUDGE** Scl/14.06.2016