Disposed

T.M.Firoze v. the Intelligence Officer (Ib) Kasargod

Kerala HC10 Dec 2013WP(C)/27576/2011

Case brief

AI extract

What is this about?

The single judge held that imposing penalty and reassessment without allowing cross-examination violates natural justice. The petitioner was directed to remit Rs. 15 lakhs and appear for a fresh hearing to cross-examine witnesses before final orders are passed.

What did the court decide?

The petitioner shall remit Rs. 15,00,000 to the first respondent within one month and appear on 18.12.2013 to afford him an opportunity to cross-examine witnesses.

T.M.Firoze Vs the Intelligence Officer (Ib)… — Civil Procedure and Limitation | Kerala HC (2013)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR.JUSTICE V.CHITAMBARESH

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TUESDAY, THE 10TH DAY OF DECEMBER 2013/19TH AGRAHAYANA, 1935

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WP(C).No. 27576 of 2011 (V)

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PETITIONER(S):

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T.M.FIROZE,PROPRIETOR, M/S.T.M.POULTRY FARM, SEETHAMGOLI KASARAGOD AND SALES DEPOT AT NESMITH COMPLEX MARKET ROAD, KASARAGOD.

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BY ADVS.SRI.T.M.SREEDHARAN (SR.) SMT.NISHA JOHN SRI.V.P.NARAYANAN

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RESPONDENT(S):

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1. THE INTELLIGENCE OFFICER (IB) OFFICE OF THE INSPECTING ASSISTANT COMMISSIONER (INTELLIGENCE), COMMERCIAL TAXES, KASARAGOD 671 121

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2. THE COMMERCIAL TAX OFFICER (SS) COMMERCIAL TAXES, KASARAGOD 671 121

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3. THE INSPECTING ASSISTANT COMMISSIONER (INTELLIGENCE), COMMERCIAL TAXES, NEAR CLOCK TOWER KASARAGOD 671 121

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BY SPL. GOVERNMENT PLEADER SRI. GEORGE MECHERIL, TAXES

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THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 10-12-2013, ALONG WITH WPC. NO. 30063/2011 & WPC. NO. 9415/2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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DCS

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WP(C).No. 27576 of 2011 (V)

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APPENDIX

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PETITIONER(S) EXHIBITS :-

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EXT.P1 TRUE COPY OF THE ANNUAL RETURNS FOR THE YEAR 2009-2010 SUBMITTED BY THE PETITIONER BEFORE THE 2ND RESPONDENT

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EXT.P1(A) TRUE COPY OF THE ANNUAL RETURNS FOR THE YEAR 2010-2011 SUBMITTED BY THE PETITIONER BEFORE THE 2ND RESPONDENT.

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EXT.P2 TRUE COPY OF THE NOTICE DATED 26.07.2011 ISSUED BY THE 1ST RESPONDENT FOR THE ASSESSMENT YEARS 2011-12

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EXT.P3 TRUE COPY OF THE NOTICE DATED 26.07.2011 RELATING TO THE ASSESSMENT YEARS 2009-10 AND 2010-11 ISSUED BY THE 1ST RESPONDENT.

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EXT.P4 TRUE COPY OF THE REPLY DATED 16.08.2011 TO THE NOTICE RELATING TO THE YEAR 2011-12 GIVEN BY THE PETITIONER TO THE 1ST RESPONDENT.

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EXT.P5 TRUE COPY OF THE REPLY DATED 15.08.2011 TO THE NOTICE RELATING TO THE YEAR 2009-10 AND 2010-11 GIVEN BY THE PETITIONER TO THE 1ST RESPONDENT.

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EXT.P6 TRUE COPY OF THE NOTICE DATED 26.08.2011 ISSUED BY THE 1ST RESPONDENT TO THE PETITIONER

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EXT.P7 TRUE COPY OF THE LETTER DATED 27.09.2011 GIVEN BY THE PETITIONER TO THE 1ST RESPONDENT.

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EXT.P8 TRUE COPY OF JUDGMENT DATED 29.9.2011 IN W.P(C) NO.25964 OF 2011 OF THIS HON'BLE COURT.

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EXT.P9 TRUE COPY OF THE ACKNOWLEDGMENT FOR DELIVERY OF EXT.P7 LETTER TO THE 1ST RESPONDENT.

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EXT.P10 TRUE COPY OF ORDER NO IB(K 141)/2010-11 DATED 4.10.2011 PASSED BY THE FIRST RESPONDENT.

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EXT.P11 TRUE COPY OF THE ORDER DATED 8-7-2011 UNDER SECTION 25(1) OF THE KVAT ACT FOR 2010-11 ISSUED BY THE 2ND RESPONDENT.

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EXT. P12 COPY OF THE NOTICE NO. A.2133/11-12 DATED 15.11.2011 ISSUED BY THE INSPECTING ASST. COMMISSIONER, COMMERCIAL TAXES, KASARAGOD

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RESPONDENTS' EXHIBITS : NIL

/TRUE COPY/

P.A. TO JUDGE

DCS

V.CHITAMBARESH,J.

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-------------------------------

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W.P.(C) Nos. 27576, 30063 of 2011 & W.P.(C) No.9415 of 2012

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--------------------------------------- Dated this the 10^th day of December, 2013

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J U D G M E N T

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The orders imposing penalty as well as the notice proposing reassessment on its basis are impugned in these three writ petitions. Ext. P10 order in W.P.(C).No. 27576/2011 imposes penalty on the petitioner for the assessment year 2010-11. Ext. P11 order in W.P.(C). No. 30063/2011 imposes penalty on the petitioner for the assessment year 2011-12. The petitioner had submitted Ext. P7 representation to the first respondent confirming the despatch of a telegram earlier. The relevant part of Ext. P7 representation marked in the above two writ petitions reads as follows:-

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“I confirm the following telegram sent to you today:

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“Further to the previous replies submitted, I request you to please disclose the sources from which the invoices used against me were obtained/recovered and also an opportunity for cross examination of the concerned persons who supplied the invoices to you. This is part of the requirements of natural justice. Letter follows”.

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W.P.(C) Nos. 27576, 30063 of 2011 &

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W.P.(C) No.9415 of 2012 2

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The petitioner apprehended that he would not be afforded an opportunity to cross examine the persons who had supplied the documents to the first respondent. The petitioner therefore filed W.P.(C). No. 25964/2011 which was disposed of by Ext. P8 judgment marked in the two writ petitions as follows:-

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“I am of opinion that this writ petition is premature. The opportunity prayed for and the documents sought for have not yet been denied to the petitioner. In fact, if it is so denied by the 1^st respondent without appropriate reasons, certainly, the petitioner will have a cause of action to challenge the orders pursuant to Exts. P2 and P3. I have no reason at this stage to assume that the 1^st respondent would complete proceedings against law.”

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But the apprehension of the petitioner proved to be true when Exts. P10 and P11 orders referred to supra were passed without affording an opportunity to cross examine the persons who supplied the invoices.

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A counter affidavit has been filed on behalf of the first respondent in W.P.(C). No. 27576/2011 wherein it is inter alia averred as follows:-

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“It is submitted that on 16.08.2011 the only request of the petitioner was to peruse the invoices. Only after replacing the 45 invoices and obtaining the certified copies, on 27.09.2011 the petitioner gave a letter seeking an opportunity for cross examination of the

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W.P.(C) Nos. 27576, 30063 of 2011 & W.P.(C) No.9415 of 2012 3

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person who allegedly supplied the invoices to the authorities. So opportunity for cross examination of the persons who allegedly supplied these invoices to the authorities was not granted.”

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It is thus a conceded fact that an opportunity to cross examine the persons who supplied the invoices was not afforded to the petitioner as sought. This is an infraction of the principles of natural justice as held in State of Kerala v. K.T. Shaduli Yusuff [(1977) 39 STC 478(SC)]. It has been held therein as follows:-

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“Now, obviously “to prove” means to establish the correctness or completeness of the return by any mode permissible under law. The usual mode recognised by law for proving a fact is by production of evidence and evidence includes oral evidence of witnesses. The opportunity to prove the correctness or completeness of the return would, therefore, necessarily carry with it the right to examine witnesses and that would include equally the right to cross-examine witnesses examined by the Sales Tax Officer....................................................

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It can hardly be disputed that cross-examination is one of the most efficacious methods of establishing truth and exposing falsehood.”

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Ext. P10 order in W.P.(C). No. 27576/2011 and Ext. P11 order in W.P.(C). No. 30063/2011 have obviously been passed in negation of the principles of natural justice. An opportunity should therefore be afforded to the petitioner to

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W.P.(C) Nos. 27576, 30063 of 2011 &

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W.P.(C) No.9415 of 2012 4

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cross examine the witnesses who supplied the invoices for which the matter has to be remitted to the first respondent. The Government Pleader points out that a whopping sum of Rupees Seven Crores is due from the petitioner under Exts. P10 and P11 orders impugned in these two writ petitions. I am therefore inclined to grant one more opportunity to the petitioner but ofcourse on condition that he remits a sum of Rs. 15,00,000/- (Rupees Fifteen Lakhs only) with the first respondent within a period of one month from today. The petitioner shall appear before the first respondent at 11 A.M. on 18.12.2013 who shall complete the exercise and pass final orders on or before 31.01.2014. The first respondent shall afford reasonable opportunity to the petitioner to summon and cross examine the witnesses and to offer his explanation within the time stipulated.

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The proceedings pursuant to Exts. P3 and P4 reassessment notices in W.P.(C). No. 9415/2012 shall also be taken to a logical end by the first respondent. This would ofcourse depend on the fresh orders to be passed by the first respondent pursuant to the directions in W.P.(C). No. 27576/2011 and W.P.(C). No. 30063/2011. The petitioner will lose the benefit of this judgment if he commits default in the

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W.P.(C) Nos. 27576, 30063 of 2011 & W.P.(C) No.9415 of 2012 5

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payment of Rs. 15,00,000/- (Rupees Fifteen Lakhs only) as directed or refuses to appear before the first respondent as scheduled.

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These writ petitions are disposed of.

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sd/-

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V.CHITAMBARESH JUDGE

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DCS

T.M.Firoze v. the Intelligence Officer (Ib) Kasargod

Case brief

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T.M.Firoze v. the Intelligence Officer (Ib) Kasargod

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