High Court of KeralaDivision Bench2020-06-19Remanded to Tribunal for fresh merits considera...

State of Kerala v Vikranth Tyres Ltd.

Case / Petition Number:ST.Rev.No.13 of 2017; ST.Rev.No.15 of 2017

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: K. Vinod Chandran
T. R. Ravi
Judgment Date: 2020-06-19
Court Decision / Holding: The revisions are allowed and remanded to the Tribunal for fresh merits consideration. The Tribunal is to decide the issues expeditiously. Even if a demand is found liable, interest shall not run from the last day of limitation to file the appeal before the Tribunal until the date the revisions were filed (14 August 2017 and 22 August 2017, as per the revision memorandums). No costs. Both ST.Rev.No.13/2017 and ST.Rev.No.15/2017 are allowed in part and remanded for fresh consideration on merits; no express findings on the factual issues prior to the Assessing Authority.
Final Disposition: Remanded to Tribunal for fresh merits consideration; no costs.

Parties to the Case

Appellants / Petitioners

State of Kerala represented by the Deputy Commissioner (Law), Commercial Taxes, Ernakulam.

Respondents

M/S. Vikranth Tyres Ltd. (J.K. Tyres and Industries), Palarivattom, Cochin, PIN 682025.

Legal Representation & Advocates

Counsels for Petitioners

• Senior Government Pleader Sri. Mohammed Rafiq

Counsels for Respondents

• Smt. Mariam Mathai
• Sri. Saji Varghese

Case Synopsis & Summary

These two revisions arise from orders of the Kerala High Court in ST.Rev.No.13 of 2017 and ST.Rev.No.15 of 2017, challenging Tribunal orders under the KGST regime for the assessment years 2002-2003 and 2003-2004. The State of Kerala, represented by the Deputy Commissioner (Law), Commercial Taxes, contends that the sole legal question is whether the delay-condonation issue merits dismissal and that the Tribunal had power to condone such delay; a remand for merits is warranted since the Tribunal is the last fact-finding authority and the core issue concerns alleged sales returns. Vikranth Tyres Ltd. argues that the delay was substantial and that the revision was filed after extensive delays, causing prejudice and potential interest liability if condoned. The court cites a Full Bench decision in Travancore Trading Corporation v. Commercial Tax Officer (2016) (FB) to support maintainability of revisions against dismissal on delay condonation and notes the discretion of the hearing Bench to determine whether grounds against subordinate orders should be examined. The High Court ultimately remands both revisions to the Tribunal for fresh merits consideration, emphasizing expeditious disposal and clarifying that interest shall not accrue from the last day of limitation to file the revisions until their filing dates. No costs are awarded.

Submissions & Arguments

Contentions of Appellants / Petitioners

The State contends that the sole question of law concerns the admissibility of delay condonation before the Tribunal. It submits that the Tribunal has the discretion to condone delays and that a Full Bench decision in Travancore Trading Corporation v. Commercial Tax Officer (FB) supports the maintainability of revisions filed against an order of dismissal on delay condonation. The State argues that the matter involves factual aspects of sales returns and stock movement that must be considered on merits by the Tribunal, which is the last fact-finding authority under the KGST regime. Therefore, remand to the Tribunal for fresh adjudication on merits is warranted, with expedited disposal and without penal interest running from the last date of limitation until the revised filing.

Contentions of Respondents

The assessee contends that the delay before the Tribunal amounted to 45 days for the delay petition and overall more than 250 days, resulting in potential prejudice and interest liabilities if condoned. It argues that condoning such delay would undermine the statutory timelines and rights of revenue. The respondents urge that the revision should be decided on factual issues based on the records (invoices, stock entries, credit notes) and finality should be reached by the Tribunal, rather than remanding. They stress the need for timely resolution and caution against indefinite proceedings.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
Travancore Trading Corporation v. Commercial Tax Officer	2016 (4) KLT 837 (FB)	Positive	Full Bench decision cited to support maintainability of revision against dismissal on delay condonation and to justify the bench's discretion to address grounds against subordinate orders.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN** **&** **THE HONOURABLE MR. JUSTICE T.R.RAVI** **FRIDAY, THE 19TH DAY OF JUNE 2020 / 29TH JYAISHTA, 1942** **ST.Rev.No.13 OF 2017** **AGAINST THE ORDER IN INTP NO.95/2012 IN T.A. NO.79/2012 DATED 0906-2016 OF THE KERALA AGRICULTURAL INCOME TAX AND SALES TAX APPELLANTE TRIBUNAL, ADDITIONAL BENCH, ERNAKULAM** ## **REVISION PETITIONER/APPELLANT/RESPONDENT/REVENUE:** **STATE OF KERALA REPRESENTED BY THE DEPUTY COMMISSIONER (LAW) COMMERCIAL TAXES, ERNAKULAM.** **BY SENIOR GOVT.PLEADER SRI.MOHAMMED RAFIQ** ## **RESPONDENT/RESPONDENT/APPELLANT/ASSESSEE:** **M/S.VIKRANTH TYRES LTD. (J.K. TYRES AND INDUSTRIES) PALARIVATTOM, COCHIN, PIN. 682025.** **R1 BY ADV. SMT.MARIAM MATHAI R1 BY ADV. SRI.SAJI VARGHESE** **THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 19.06.2020, ALONG WITH ST.Rev.NO.15/2017, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** ST.Rev.No.13 OF 2017 2 ## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** **THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN** **&** **THE HONOURABLE MR. JUSTICE T.R.RAVI** **FRIDAY, THE 19TH DAY OF JUNE 2020 / 29TH JYAISHTA, 1942** **ST.Rev..No.15 OF 2017** **AGAINST THE ORDER IN INTP NO.96/2012 IN T.A. NO.80/2012 DATED 09-06-2016 OF THE KERALA AGRICULTURAL INCOME TAX AND SALES TAX APPELLANTE TRIBUNAL, ADDITIONAL BENCH, ERNAKULAM** ## **REVISION PETITIONER/APPELLANT/RESPONDENT/REVENUE:** **STATE OF KERALA REPRESENTED BY THE DEPUTY COMMISSIONER (LAW) COMMERCIAL TAXES, ERNAKULAM.** **BY SENIOR GOVT.PLEADER SRI.MOHAMMED RAFIQ** ## **RESPONDENT/RESPONDENT/APPELLANT/ASSESSEE:** **M/S.VIKRANTH TYRES LTD. (J.K. TYRES AND INDUSTRIES) PALARIVATTOM, COCHIN, PIN. 682025.** **R1 BY ADV. SMT.MARIAM MATHAI R1 BY ADV. SRI.SAJI VARGHESE** **THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 19.06.2020, ALONG WITH ST.Rev.NO.13/2017, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** ST.Rev.No.13 OF 2017 3 ## **O R D E R** ## **K. Vinod Chandran, J.** **The revisions are with respect to the assessment years 2002-2003 and 2003-2004. The order, against which the sole question of law raised, rejected the appeal as a consequence of the rejection of the delay petition, where the delay was of 42 days. Learned Senior Government Pleader appeared and argued that the question of law is only with respect to the dismissal on grounds of limitation, when the delay was a mere 45 days and the Tribunal had the power to condone such delay. It is pointed out that there was satisfactory explanation shown by the State for condoning the delay. Learned Senior Government Pleader seeks for a remand, especially since the Tribunal is the last fact finding authority and the issue with respect to the sales return has to be** ST.Rev.No.13 OF 2017 4 ## **considered on facts by the Tribunal.** **2. Learned Government Pleader fairly placed on record a decision of a Full Bench of this Court reported in** _**Travancore Trading Corporation v. Commercial Tax officer [2016 (4) KLT 837 (F.B.)]**_ **, wherein a revision against an order of dismissal as a consequence of rejection of the delay condonation application was held to be maintainable. It is pointed out that the Full Bench had also found that it is within the wisdom of the Bench hearing the revision to decide as to whether the grounds raised as against the order of the subordinate authority, ie. herein the assessing authority and the first appellate authority, are to be examined or not.** **3. The learned Counsel appearing for the respondent points out that when delay before the Tribunal was 45 days, the revision itself was filed with more than 250 days delay. It is pointed out that** ST.Rev.No.13 OF 2017 5 **the assessee would be unnecessarily prejudiced, insofar as the interest liability cast on them.** **4. We have looked at the issue agitated before the Assessing Authority. The Assessing Authority was of the opinion that the sales returns claimed by the assessee were not in fact sales returns. The Assessing Officer found that invoices and consequent credit notes were issued, but there were no consequent entries made in the Stock Register, for the movement of the goods from the assessee to their dealer pursuant to the sale effected. It was also found that there were no debit notes issued by the purchasing dealer.** **5. The assessee however, had contended that those were unfructified sales. The First Appellate Authority found that the claim was only of unfructified sales and there was no delivery effected. Definitely, there should be an examination** ST.Rev.No.13 OF 2017 6 **of the invoices and the transactions, by the Tribunal to arrive at the correct findings on facts.** **6. In such circumstances, we are of the opinion that the matter has to be looked at by the Tribunal and hence we remand the same for fresh consideration on merits. The order of the Tribunal is set aside for the purpose of such consideration. The Tribunal shall consider the issue expeditiously, since the matter is with respect to KGST regime, which ended in the year 2006-2007. We make it clear that even if the assessee is found liable to pay up the demand, the interest shall not run from the last day of limitation to file the appeal before the Tribunal, till the date on which the revisions were filed, the latter of which dates, we find from the revision memorandums to be respectively on 14[th] and 22[nd] of August, 2017.** **Without any finding on the factual issue** ST.Rev.No.13 OF 2017 7 ## **before the Assessing Officer, both S.T. Revisions are** **allowed. No costs.** ## **Sd/-** **K. VINOD CHANDRAN, JUDGE.** **Sd/-** **T.R. RAVI, JUDGE.** **sp/19/06/2020** **//True Copy//** **P.A. To Judge** ST.Rev.No.13 OF 2017 8 ## **APPENDIX OF ST.Rev. 13/2017** **PETITIONER'S/S EXHIBITS:** **ANNEXURE A TRUE COPY OF THE PROCEEDINGS OF ASSISTANT COMMISSIONER, SPECIAL CIRCLE, ERNAKULAM DATED 31.07.2010. ANNEXURE B TRUE COPY OF THE ORDER OF FIRST APPELLATE AUTHORITY. ANNEXURE C CERTIFIED COPY OF THE ORDER OF TRIBUNAL DATED 09.06.2016. ANNEXURE C1 TRUE COPY OF ANNEXURE C** ST.Rev.No.13 OF 2017 9 ## **APPENDIX OF ST.Rev. 15/2017** **PETITIONER'S/S EXHIBITS:** **ANNEXURE A TRUE COPY OF THE PROCEEDINGS OF ASSISTANT COMMISSIONER, SPECIAL CIRCLE, ERNAKULAM DATED 31.07.2010.** **ANNEXURE B TRUE COPY OF THE ORDER OF FIRST APPELLATE AUTHORITY.** **ANNEXURE C TRUE COPY OF THE ORDER OF TRIBUNAL DATED 09.06.2016.**