The petitioner challenged an assessment order passed under the KGST Act without a hearing and without crediting tax deducted at source. Found merit in violation of natural justice and omission of TDS.
Ext.P2 order quashed; Fast Track Team directed to complete assessment afresh within three months noting TDS from Ext.P1 and giving hearing opportunity.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR. JUSTICE A.K.JAYASANKARAN NAMBIAR
THURSDAY, THE 28TH DAY OF JANUARY 2016/8TH MAGHA, 1937
WP(C).No. 6421 of 2011 (C)
PETITIONER:
MR.BINU THOMAS,WORKS CONTRACTOR, 43/3000, KURUMACHERRY, S.N.ROAD, ERNAKULAM, PIN-682020.
BY ADV. SMT.K.LATHA
RESPONDENT(S):
1. THE STATE OF KERALA, REPRESENTED BY CHIEF SECRETARY, SECRETARIAT, THIRUVANANTHAPURAM-695001.
2. ASST.COMMISSIONER(WORKS CONTRACT), OFFICE OF THE DEPUTY COMMISSIONER, COMMERCIAL TAXES, ERNAKULAM-682019.
3. THE FAST TRACK TEAM-1, COMMERCIAL TAX DEPARTMENT, ERNAKULAM-682019.
4. THE INSPECTING ASST.COMMISSIONER, COMMERCIAL TAXES, ERNAKULAM-682030.
BY GOVERNMENT PLEADER SRI.LIJU V.STEPHEN
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28-01-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
mbr/
WP(C).No. 6421 of 2011 (C)
APPENDIX
PETITIONERS' EXHIBITS:
RESPONDENTS' EXHIBITS: NIL.
//TRUE COPY//
P.S. TO JUDGE
mbr/
A.K.JAYASANKARAN NAMBIAR, J. ............................................................. W.P.(C).No.6421 Of 2011
............................................................. Dated this the 28th day of January, 2016
J U D G M E N T
The challenge in the writ petition is against Ext.P2 order of assessment passed in relation to the petitioner under the Kerala General Sales Tax Act (hereinafter referred to as 'the KGST Act') for the assessment year 2004-2005. Ext.P2 assessment order is passed under Section 17D of the KGST Act during a fast track assessment. The grievance of the petitioner in the writ petition is essentially two fold. On the one hand, it is stated that the assessment order was passed without hearing the petitioner. Secondly, it is pointed out that in the assessment order there is no credit given of tax amounts that were deducted from payments made to the petitioner and remitted to the department. The petitioner therefore impugns Ext.P2 order, inter alia, on the grounds that it is passed in violation of the rules of natural justice and also vitiated on account of a patent non-application of mind.
W.P.(C). No. 6421 of 2011
-2-
On a consideration of the facts and circumstances of the case and submissions made across the bar, I find that, it is not in dispute that the petitioner was not heard before passing Ext.P2 order. Ext.P2 order clearly mentions that a notice was served on the address of the petitioner but the said notice was returned unclaimed or with the endorsement addressee left. Although the petitioner would dispute the service of notice on him, there is no material produced to doubt the correctness of the statements in Ext.P2 order with regard to service of the notice on the address of the petitioner. I find, however, that the petitioner has produced as Ext.P1, a certificate issued by the Corporation of Cochin, for whom the petitioner had rendered various works, wherein it is stated that amounts were deducted by way of sales tax from payments that were made to the petitioner, and the details of tax remittance to the department are also shown. In Ext.P2 order that is passed in relation to the petitioner, the tax paid by way of TDS is shown as nil. This would indicate that the amounts that were deducted at source from payments made to the petitioner by the Corporation of Cochin have not been credited to the account of the petitioner while completing the assessment in relation to the petitioner for the assessment year in question. The tax amounts shown as deducted in Ext.P1 certificate are substantial when compared to
-3-
W.P.(C). No. 6421 of 2011
the total tax liability that is ultimately fastened on the petitioner under Ext.P2 order. Inasmuch as, as per the provisions of Section 17D of the KGST Act, the petitioner cannot prefer an appeal against Ext.P2 order without paying the entire tax amount that is confirmed on the petitioner by Ext.P2 assessment order, I am of the view that the interests of justice would require me to quash Ext.P2 order and direct the Fast Track Team to complete the assessment in relation to the petitioner for the assessment year 2004-2005 afresh after taking note of the deductions effected from payments made to the petitioner by the Corporation of Cochin as noticed in Ext.P1 certificate produced in the writ petition. The petitioner shall also be given an opportunity of hearing before passing fresh orders as directed. The Fast Track Team shall pass fresh orders within a period of three months from the date of receipt of a copy of this judgment. The petitioner shall produce a copy of the writ petition along with a copy of the judgment before the members of the Fast Track Team for further action.
A.K.JAYASANKARAN NAMBIAR JUDGE
mns/29.01.16
W.P.(C). No. 6421 of 2011
-4-
3 issues framed by the court
Whether the assessment order passed without hearing the petitioner violates natural justice.
Whether tax deducted at source was credited to the petitioner during assessment.
Whether the quashing of the assessment order is necessary to secure the interests of justice.
1 provisions across 1 enactments
MR.BINU THOMAS
THE STATE OF KERALA
A.K.JAYASANKARAN NAMBIAR
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
