PepsiCo India Holdings Private Limited v State of Kerala and others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN** **THURSDAY, THE 15TH DAY OF DECEMBER 2016/24TH AGRAHAYANA, 1938** **WP(C).No. 38489 of 2016 (I) ----------------------------** ## **PETITIONER(S):** ## **-------------** **PEPSICO INDIA HOLDINGS PRIVATE LIMITED, WISE PARK, INDUSTRIAL DEVELOPEMNT AREA, KANJOKODE EAST P.O., PALAKKAD - 678 621, REPRESENTED BY ITS PLANT ACCOUNTANT AND AUTHORIZED SIGNATORY MR.SUKALYAN BOSE.** **BY ADVS.SRI.M.GOPIKRISHNAN NAMBIAR SRI.P.GOPINATH SRI.P.BENNY THOMAS SRI.K.JOHN MATHAI SRI.JOSON MANAVALAN SRI.KURYAN THOMAS SRI.RAJA KANNAN** ## **RESPONDENT(S):** **--------------** **1. STATE OF KERALA, REPRESENTED BY ITS SECRETARY TO GOVERNMENT, TAXES DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM - 695 001.** **2. DEPUTY COMMISSIONER, COMMERCIAL TAXES, PALAKKAD - 678 001.** **3. THE ASSISTANT COMMISSIONR (ASSESSMENT), SPECIAL CIRCLE, COMMERCIAL TAXES, PALAKKAD - 678 001.** **BY SPECIAL GOVERNMENT PLEADER SRI.C.K.GOVINDAN** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 15-12-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **msv/** ## **WP(C).No. 38489 of 2016 (I)** ## **---------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS** **-----------------------** - **P1 A TRUE COPY OF THE NOTICE DATED 28.10.2013 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT.** - **P2 A TRUE COPY OF THE REPLY DATED 11.11.2013 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **P3 A TRUE COPY OF THE NOTICE DATED 10.2.2014 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT.** - **P4 A TRUE COPY OF THE REPLY SUBMITTED ON 17.2.2014 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **P5 A TRUE COPY OF THE NOTICE DATED 30.9.2014 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT.** - **P6 A TRUE COPY OF THE REQUEST DATED 04.10.2014 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **P7 A TRUE COPY OF THE REVISED NOTICE DATED 15.10.2015 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT.** - **P8 A TRUE COPY OF THE REQUEST DATED 06.11.2015 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **P9 A TRUE COPY OF THE NOTICE DATED 18.11.2015 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT.** - **P10 A TRUE COPY OF THE REQUEST DATED 26.11.2015 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **P11 A TRUE COPY OF THE REPLY DATED 01.2.2016 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **P12 A TRUE COPY OF THE NOTICE DATED 19.09.2016 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT.** - **P13 A TRUE COY OF THE REQUEST DATED 13.10.2016 SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT.** - **P14 A TRUE COPY OF THE ORDER DATED 21.10.2016 ISSUED TO THE PETITIONER BY THE 3RD RESPONDENT.** - **P15 A TRUE COPY OF THE ORDER DATED 28.3.2016 PASSED BY THE 2ND RESPONDENT.** **RESPONDENT(S)' EXHIBITS** **----------------------NIL //TRUE COPY//** **P.S.TO JUDGE** **msv/** ## **K. VINOD CHANDRAN, J.** -----------------------------------------W.P.(C) No. 38489 of 2016 (I) -----------------------------------------Dated: 15[th] December, 2016 ## **J U D G M E N T** The petitioner is aggrieved with Ext.P14 Assessment Order, passed by the Assistant Commissioner (Assmt.), Special Circle, Commercial Taxes, Palakkad, the Assessing Officer of the petitioner. The Assessment Order was passed under Section 25(1) of the Kerala Value Added Tax Act, 2003 ('KVAT Act' for short). 2. The short contention raised to maintain the writ petition is that the notice issued under Section 25 of the KVAT Act, Ext.P12, is beyond the limitation period provided under Section 25. The limitation, as provided under Section 25, is a five year period and the assessment is of the year 2010-2011. The contention ## **W.P.(C) No. 38489/2016** **-2-** further raised by the petitioner is that the objections in Exts.P4 and P11 have not been considered. 3. The learned Government Pleader, however, relies on the various notices issued to contend that Section 25 was invoked within the time prescribed and that there is no mandate that there should be conclusion of the assessment proceedings within the limitation period, as held by the Full Bench in **Cholayil Private Limited v. Assistant Commissioner (Assessment) - 2015 (4) KLT 516 (F.B.)** . 4. Ext.P1 is the first notice issued on 28.10.2013, which sought to include, in the turnover, sale of fixed assets. The specific defense taken up on the notice is that the Assessing Officer had reckoned the sale of fixed assets of the Company, as was occasioned in the whole of the country and apportioned a portion to the State of Kerala, which was not a proper exercise. Ext.P4 dated ## **W.P.(C) No. 38489/2016** **-3-** 17.02.2014 is the reply in which such a contention was taken up. Subsequently, Ext.P5 notice dated 30.19.2014 was issued directing the petitioner to produce the Books of Accounts. The petitioner sought for an adjournment by Ext.P6 dated 04.10.2014. Admittedly, the petitioner did not produce the Books of Accounts. 5. The contention raised by the petitioner is that no subsequent notice was issued and hence the Books of Accounts were not produced. This Court is unable to countenance such a contention. When an adjournment was sought specifically on the notice issued for production of Books of Accounts, it was the obligation of the petitioner to produce the Books of Accounts even without any further notice issued. Be that as it may, the Assessing Officer, a new incumbent to the office; then issued Ext.P7 notice, again under Section 25(1), which was also within the limitation provided under Section ## **W.P.(C) No. 38489/2016** **-4-** 25. The Assessing Officer specifically invited documentary evidence on the objection raised by the petitioner at Ext.P4. The petitioner, to Ext.P7, sought an adjournment by Ext.P8 and a further chance was given by Ext.P9 notice. Again, the petitioner sought time by Ext.P10. Eventually reply was filed by Ext.P11 after a series of adjournments, but no Books of Accounts produced nor any other documentary evidence furnished. 6. Considering the objections, a revised notice was issued at Ext.P12 dated 19.09.2016, which is said to be beyond the limitation period. The learned Government Pleader submits that the revised notice was necessitated only for reason of a deduction made, from the total turnover, which was considerably large. A reading of Exts.P7 and P12 would indicate that earlier the Assessing Officer had deducted the sales turnover ## **W.P.(C) No. 38489/2016** **-5-** to Canteen, coming to Rs.2,59,72,895.00 from the total turn over. On the objections filed, the deduction was enhanced to Rs.59,52,62,182.00. 7. It is clear that there were notices issued after Exts.P4 and P11, on which objections were called for and the objection to Ext.P7 was considered and then a revised notice issued under Ext.P12, which took note of one of the objections raised and deducted the total turn over proposed, considerably, i.e: to the extent of Rs.57 crores. 8. The last notice issued, obviously, was in continuance of the invocation of the proceedings under Section 25, commenced with Ext.P1, and followed up with various notices. Even going through Exts.P7 and P12, it is very evident that the Assessing Officer had considered the objection raised by the petitioner and had deducted sales turnover to a considerable extent as ## **W.P.(C) No. 38489/2016** **-6-** per Ext.P12. The proceedings, admittedly, was initiated within the limitation period. The petitioner/assessee was constantly seeking adjournments and, despite repeated notices, had failed to substantiate their contentions with evidence or documentary by production of Books of Accounts. The last notice issued, though beyond the limitation period, was in continuance of the proceedings already initiated and there was also no new addition proposed therein; which had not been taken up in the notices issued, well within the limitation period. The ground, of the proceedings being hit by limitation, hence, fails. 9. In such circumstance, this Court does not find any reason to invoke the extra ordinary jurisdiction under Article 226 of the Constitution of India. However, this would not preclude the petitioner from approaching the Appellate Authority under the KVAT ## **W.P.(C) No. 38489/2016** **-7-** Act. The writ petition is dismissed leaving open the factual contentions of the petitioner against the assessment, to be agitated before the Appellate Authority. No Costs. Sd/K.VINOD CHANDRAN, JUDGE jjj 15/12/16