Allowed

Prabhus Sanitary v. Commercial Tax Officer, Mattanchery

Kerala HC28 Oct 2016WP(C)/6587/2016

Case brief

AI extract

What is this about?

The single-judge court allowed writ petitions challenging assessment and penalty orders passed against a presumptive dealer under the KVAT Act. Relying on a Division Bench judgment, the court held that detection of suppression does not disqualify a dealer with total turnover under ₹60 lakhs from Section 6(5) benefits. The orders were set aside, and tax/penalty recomputation was directed.

What did the court decide?

Set aside assessment and penalty orders; direct assessing officer to recompute tax and penalty on the basis of Section 6(5) of the KVAT Act.

Prabhus Sanitary Vs Commercial Tax Officer… — 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 A.M.SHAFFIQUE

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FRIDAY, THE 28TH DAY OF OCTOBER 2016/6TH KARTHIKA, 1938

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WP(C).No. 6587 of 2016 (W)

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PETITIONER:

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PRABHUS SANITARY, IV/365, PALLURUTHY, KOCHI-682 006, REPRESENTED BY PROPRIETOR V.A.RAMESH PRABHU).

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BY ADVS.SRI.K.N.SREEKUMARAN SMT.V.P.SEENA DEVI

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RESPONDENT(S):

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1. COMMERCIAL TAX OFFICER, 2ND CIRCLE, MATTANCHERRY, PIN-682 002.

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2. COMMISSIONER OF COMMERCIAL TAXES, TAX TOWER, KARAMANA, THIRUVANANTHAPURAM-695 001.

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BY GOVERNMENT PLEADER SRI V.K.SHAMSUDHEEN

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THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 28-10-2016,ALONG WITH WPC NO. 13014/2016 & WPC NO. 14086/2016 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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K.V.

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WP(C).No. 6587 of 2016 (W)

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APPENDIX

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PETITIONER(S)' EXHIBITS

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P1 : COPY OF THE ANNUAL RETURN FOR THE YEAR 2012-13 FILED BEFORE THE 1ST RESPONDENT.

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P2 : COPY OF THE ANNUAL RETURN FOR THE YEAR 2013-14 FILED BEFORE THE 1ST RESPONDENT.

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P3 : COPY OF THE ANNUAL RETURN FOR THE YEAR 2014-15 FILED BEFORE THE 1ST RESPONDENT.

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P4 : COPY OF THE PRE-ASSESSMENT NOTICE DATED.11.11.2015 FOR THE YEAR 2012-13 ISSUED BY THE 1ST RESPONDENT.

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P5 : COPY OF THE PRE-ASSESSMENT NOTICE DATED.11.11.2015 FOR THE YEAR 2013-14 ISSUED BY THE 1ST RESPONDENT.

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P6 : COPY OF THE PRE-ASSESSMENT NOTICE DATED.11.11.2015 FOR THE YEAR 2014-15 ISSUED BY THE 1ST RESPONDENT.

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P7 : COPY OF THE ASSESSMENT ORDER NO.32426421506/12-13 DATED.19.12.2015 ISSUED BY THE 1ST RESPONDENT.

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P7(A) COPY OF THE PENALTY ORDER NO.32426421506/12-13 DATED.19.12.2015 ISSUED BY THE 1ST RESPONDENT.

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P8 : COPY OF THE ASSESSMENT ORDER NO.32426421506/13-14 DATED.19.12.2015 ISSUED BY THE 1ST RESPONDENT.

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P8(A) : COPY OF THE PENALTY ORDER NO.32426421506/13-14 DATED.19.12.2015 ISSUED BY THE 1ST RESPONDENT.

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P9 : COPY OF THE ASSESSMENT ORDER NO.32426421506/14-15 DATED.19.12.2015 ISSUED BY THE 1ST RESPONDENT.

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P9(A) : COPY OF THE PENALY ORDER NO.32426421506/14-15 DATED.19.12.2015 ISSUED BY THE 1ST RESPONDENT.

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RESPONDENT(S)' EXHIBITS NIL

/TRUE COPY/

P.A.TO JUDGE

K.V.

A.M. SHAFFIQUE, J.

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=============== W.P. (C) Nos. 6587, 13014 & 14086 of 2016

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==========================

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Dated this, the 28^th day of October, 2016

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J U D G M E N T

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Petitioners who are registered dealers under the KVAT Act who had opted for tax at 0.5% of the KVAT Act as a presumptive dealer challenges the assessment orders as well as the penalty orders inter alia contending that though the turnover is less than `60 lakhs, still, the assessing officer has assessed higher rate of tax alleging suppression of turnover and has also imposed penalty for the same.

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This issue is covered by the Division Bench judgment of this Court in Mooken Devassy & Co. v. Commercial Tax Officer [(2016) 24 KTR 516 (Ker)], wherein, after considering the aforesaid issue, the Division Bench held at para 4 as under:-

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“4. There is no dispute even for the Department that the appellant is a registered dealer and that they have opted for payment of tax under Section 6(5) of the Act. However, the benefit of the Section has been denied to the appellant on the basis that certain suppression of turnover has been detected. Though it is true that suppression of turnover has been detected and an equal amount of turnover has been added, still the fact remains that the total turnover now quantified by the Assessing

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W.P(C) No.6587/16 & conn.cases

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-:2:-

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Officer is much less than 60 lakhs of rupees provided in Section 6(5). Section 6(5) of the Act do not contain a provision that an assessee in whose case suppression of turnover is detected will be denied the benefit of Section 6(5) of the Act. In such a case, even in spite of the turnover suppressed, since the turnover of the assessee is still below 60 lakhs of rupees, according to us, the assessee ought to have been given the benefit of Section 6(5) of the Act. For that reason, we are unable to sustain the judgment under appeal and Ext.P3 order of assessment passed for the assessment year 2012-2013.”

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Having regard to the aforesaid facts, I am of the view that these writ petitions are only to be allowed. Accordingly, the impugned orders, Exts.P7, P7(a), P8, P8(a), P9 and P9(a) in WP(C) No. 6587/16, Exts.P4 and P5 in WP(C) No. 13014/16 and Exts.P3 to P6 in WP(C) No. 14086/16 are set aside. The assessing officer is directed to recompute the tax payable on the basis of Section 6 (5) of the KVAT Act and also the penalty in terms with the alleged suppression.

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Sd/-

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A.M. SHAFFIQUE, JUDGE

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Rp28/10/2016

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//True Copy//

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P.S to Judge

Prabhus Sanitary v. Commercial Tax Officer, Mattanchery

Case brief

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Prabhus Sanitary v. Commercial Tax Officer, Mattanchery

Case brief

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