Partly allowed

Royal Impex v. the State of Kerala

Kerala HC23 May 2016ST.Rev./7/2013

Case brief

AI extract

What is this about?

High Court of Kerala revisited penalty orders under Kerala VAT Act where fishermen were summoned and interrogated without giving the petitioner notice. The Court held this violated natural justice and remanded the matter for reconsideration.

What did the court decide?

Impugned penalty orders set aside and remitted to the Intelligence Officer to reconsider the matter affording the petitioner an opportunity to cross-examine the fishermen.

Royal Impex Vs the State of Kerala — Writ and Judicial Review | Kerala HC (2016)

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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 ANTONY DOMINIC

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THE HONOURABLE MR. JUSTICE DAMA SESHADRI NAIDU

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MONDAY, THE 23RD DAY OF MAY 2016/2ND JYAISHTA, 1938

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ST.Rev..No. 7 of 2013 ()

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AGAINST THE ORDER/JUDGMENT IN TA 232/2009 of K.S.T.A.T.ADDL.BENCH,TVM. DATED 30-01-2012

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REVISION PETITIONER(S)/APPELLANT/ASSESSEE:

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ROYAL IMPEX BEMAPALLY, THIRUVANANTHAPURAM.

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BY ADVS.DR.K.B.MUHAMED KUTTY (SR.)

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SRI.K.M.FIROZ

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RESPONDENT(S)/RESPONDENT/REVENUE:

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THE STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, TAXES DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM-695001.

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R BY GOVT PLEADER SMT.SOBHA ANNAMMA EAPEN

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THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 23-05-2016, ALONG WITH STRV. 11/2013, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:

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APPENDIX IN STRV.7/13

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PETITIONER'S EXHIBITS:

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ANNEXURE A: TRUE COPY OF THE PENALTY ORDER FOR 2001-02 DATED 31.12.2008.

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ANNEXURE B: TRUE COPY OF THE APPELLATE ORDER DATED 1.6.2009.

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ANNEXURE C: TRUE COPY OF THE APPELLATE TRIBUNAL ORDER T.A.232/2009 DATED 30.1.2012.

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/TRUE COPY/

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PS TO JUDGE

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ANTONY DOMINIC & DAMA SESHADRI NAIDU, JJ.

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----------------------------------S.T.Rev.Nos.7 & 11 of 2013 ----------------------------------Dated this the 23^rd day of May, 2016

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O R D E R

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Antony Dominic, J.

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1.Orders of penalty imposed on the petitioner under section 45 A of the Kerala Value Added Tax Act, which was confirmed by the statutory appellate authorities, is under challenge.

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2.We heard learned senior counsel for the petitioner and learned Government Pleader appearing for the respondent.

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3.These revisions relate to the assessment years 200102 and 2002-03. Petitioner is an assessee on the rolls of the Sales Tax Officer, III Circle, Trivandrum. The Intelligence Officer, Commercial Taxes, Trivandrum imposed penalty under section 45 A of the Act on the basis of unaccounted transactions which were unearthed by the Commercial Investigation Branch of the department by verifying certain extracts of imports through Cochin Customs and bank transactions. The orders of penalty were challenged

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STRV.7/13&11/13

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in revision petitions before the Deputy Commissioner, who remitted the matter for fresh disposal. While remitting so, it was ordered that the details of date war transaction should have been made known to the petitioner by giving him notice and an opportunity. It was also ordered that regarding the amounts entrusted by fishermen with the petitioner for safe custody, the genuineness can be ascertained by verifying the statements/depositions of fishermen and the kurupu book produced before the Deputy Commissioner. Accordingly, the matter was reconsidered and the Intelligence Officer furnished the details of the date war transaction. The Intelligence Officer also summoned the fishermen and their statements were also recorded. It was thereafter that the penalty orders were passed.

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4.Before us, the main contention during the course of the hearing was that in conducting the enquiry by summoning the fishermen and recording statements, the Intelligence Officer has violated the principles of natural justice. This contention was raised on the basis that the fishermen were summoned and their

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STRV.7/13&11/13

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statements were recorded without notice to the petitioner. Although learned Government Pleader admitted to sustain the findings of the Intelligence Officer which was confirmed concurrently, she was unable to satisfy that the enquiry by summoning fishermen was with notice to the petitioner. Reading of the order shows that the statements of the fishermen have been relied on against the petitioner. Since such a statement recorded without notice to the petitioner was relied on against the petitioner, the Intelligence Officer has clearly violated the principles of natural justice. The facts being so, we are inclined to agree with the learned counsel for the petitioner that for violation of the principles of natural justice, the orders impugned in these revisions cannot be sustained.

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5.Answering the questions of law in favour of the petitioner, the impugned orders are set aside. The matter will stand remitted to the Intelligence Officer, IB Commercial Taxes, Trivandrum, who will reconsider the matter, affording the petitioner an opportunity to cross examine the fishermen whose

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STRV.7/13&11/13

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statements are recorded. On that basis, it will be open to the Intelligence Officer to pass fresh orders in accordance with law.

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Revisions are disposed of accordingly.

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Sd/ANTONY DOMINIC, Judge.

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Sd/-

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DAMA SESHADRI NAIDU, Judge.

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kkb.

Royal Impex v. the State of Kerala

Case brief

What is this about?

What did the court decide?

Royal Impex v. the State of Kerala

Case brief

What is this about?

What did the court decide?

What the court decided

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