Dismissed

State of Kerala v. P.O. Jose

Kerala HC19 Feb 2021OT.Rev/217/2014

Case brief

AI extract

What is this about?

In this revision, the Revenue challenged the Kerala VAT Appellate Tribunal's order reducing penalty from Rs. 26,099 to Rs. 5,000 on the assessee for tax contraventions involving an undated invoice and missing transport copy. The High Court dismissed the revision, upholding the Tribunal's discretionary reduction.

What did the court decide?

Revision dismissed; Tribunal's order reducing penalty to Rs. 5,000 affirmed; observations made against creating precedent from the Tribunal's specific facts.

State of Kerala Vs P.O. Jose — Writ and Judicial Review | Kerala HC (2021)

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O.T.Rev.(VAT) No.217 of 2014 1

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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 S.V.BHATTI

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THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS

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FRIDAY, THE 19TH DAY OF FEBRUARY 2021 / 30TH MAGHA,1942

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OT.Rev.No.217 OF 2014

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AGAINST THE ORDER/JUDGMENT IN TAVAT 1127/2011 DATED 02-05-2014 OF KERALA VAT APPELLATE TRIBUNAL, ERNAKULAM

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REVISION PETITIONER/RESPONDENT/REVENUE:

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STATE OF KERALA

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BY GOVERNMENT PLEADER

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RESPONDENT/APPELLANT/ASSESSEE:

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P.O. JOSE PROPRIETOR, M/S.J.J. ENTERPRISES, ELAMAKKARA, KOCHI - 682036.

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R1 BY ADV. SRI.V.DEVANANDA NARASIMHAM

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OTHER PRESENT:

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SR GP SHAMSUDHEEN V.K.

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THIS OTHER TAX REVISION (VAT) HAVING BEEN FINALLY HEARD ON 19.02.2021, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:

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O.T.Rev.(VAT) No.217 of 2014 2

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JUDGMENT

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Dated this the 19th day of February 2021

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S.V.Bhatti, J.

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Revenue is the petitioner. The petitioner in the instant revision challenges order of the Kerala Value Added Tax Appellate Tribunal, Ernakulam dated 2.5.2014 in T.A.(VAT) No.1127 of 2011/Annexure-C. The Tribunal through the order in Annexure-C reduced the penalty imposed on respondent/assessee from 26,099/- to 5000/-. Hence the Revision. The gist of controversy is stated thus:

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On 18.7.2008, the Intelligence Inspector Squad-I intercepted a vehicle carrying one FRP setting tank valued at 1,03,363/- consigned to M/s Daya Hospital, Thrissur. The invoice accompanying the consignment suffers from the infirmities that it is not dated and no transport copy of the consignment was accompanying the goods in transit. The primary authority through Annexure-A imposed penalty of 26,099/- on respondent for the violations noted above. The respondent unsuccessfully challenged the levy of penalty before the Asst.Commissioner (Appeals) vide Annexure-B. The appeal filed by respondent in T.A.(VAT) No.1127/2011 was allowed in part by the

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O.T.Rev.(VAT) No.217 of 2014 3

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Tribunal. The operative portion of the order of the Tribunal reads

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thus:

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“The contentions of both the parties for and against the imposition of penalty was heard on 2.4.2014. It is true that the date was not mentioned in the invoice accompanying the consignment. It was a bona fide mistake there are ample evidence to show that no attempt was made by the appellant to evade payment of tax from the records produced. Penalty under section 47(6) of the Act cannot be imposed mechanically without applying mind of the authority concerned. Penalty cannot be imposed on surmises. There must be cogent evidence to prove that there was attempt on the part of the dealer to evade payment of tax. Considering the facts and circumstances of the case and the evidence before us we are of the opinion that this is not a case fit enough to impose penalty under Section 47(6) of the KVAT Act. Hence we reduce the penalty to Rs.5000/- for violating Rule 58(10) of the KVAT Rules and to refund the balance security deposit to the appellant.”

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Hence the Revision.

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The following substantial questions are raised by the Revenue:

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Whether the finding of the Tribunal that the assessee is not liable to be prosecuted under Section 47(6) of the KVAT Act is perverse or not.

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Is it correct to hold the tribunal that, the subsequent production of accounts will absolve the penalty proceedings under Section 47(6) of the KVAT Act.

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Is it proper for the Tribunal to hold that, the non mentioning of the date in the bill accompanying the consignment is not an offence under Section 47(6) of the KVAT Act.

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O.T.Rev.(VAT) No.217 of 2014 4

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Is the view taken by the Tribunal is wrong in considering that the assessee has not committed offence under Section 47(6) of the KVAT Act when the goods are intercepted with invalid documents like undated copy of the bill and not accompanying with transport copy of the invoice.

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Is it proper for the Tribunal to interfere with the penalty proceedings, when there is clear evidence to show that in case the vehicle was not intercepted, there was chances for multiple transport of similar consignments with the strength of the same bill.

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Is Annexure (c) order is perverse and not sustainable in law.

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The substantial questions, in our considered view, are

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questions formulated for adjudicating the scope, object etc. of Section

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47 of the Act. In the case on hand, the Tribunal having taken note of all the given circumstances weighed the omission noted on the date of interception of consignment, the explanation offered by the dealer and the evidence on record to reduce the penalty. The questions now formulated do not refer to any infirmity or illegality in the reasoning of the Tribunal. The power and jurisdiction under Section 47 of the Act is kept in mind, but the Tribunal on totality of circumstances found that the levy of penalty of Rs.26,099/- is not warranted and in its discretion commensurate penalty could have been levied by the primary authority. We are of the view that no ground is made out

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O.T.Rev.(VAT) No.217 of 2014 5

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warranting interference. The revision must accordingly fail.

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After the order is dictated the Senior Government Pleader Shamsudheen states that the Tribunal, if treats the judgment in Annexure-C as a guiding order in matters arising under Section 47 of the KVAT Act, the Revenue will suffer prejudicially and Section would be rendered ineffective or diluted through the process of adjudication. We note the apprehension voiced by the Sr.G.P. and make observations necessary to avoid any confusion in this behalf. We,

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therefore, while dismissing the revision in the facts of this case further hold that the findings recorded in Annexure-C judgment shall not be treated as a precedent for any purpose arising under Section 47 of the KVAT Act and shall be treated as having been rendered in the facts of this case.

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Revision dismissed with the above observations.

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SD/- S.V.BHATTI

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JUDGE

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SD/- BECHU KURIAN THOMAS

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JUDGE

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css/

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O.T.Rev.(VAT) No.217 of 2014 6

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APPENDIX

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PETITIONER'S EXHIBITS:

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ANNEXURE A A TRUE COPY OF THE ORDER DATED 26.05.2009 OF THE INTELLIGENCE OFFICER SQUAD No.1, THRISSUR. ANNEXURE B A TRUE COPY OF THE ORDER PASSED BY THE ASSISTANT COMMISSIONER (APPEALS), PALAKKAD IN KVATA 2419/09 DATED 28.03.2011 ANNEXURE C A CERTIFIED COPY OF THE ORDER DATED 02.05.2014 IN TA(VAT)No.1127/11 ON THE FILE OF THE KERALA IN VALUE ADDED TAX APPELLATE TRIBUNAL, ERNAKULAM. ANNEXURE 5A A TRUE COPY OF ANNEXURE C

State of Kerala v. P.O. Jose

Case brief

What is this about?

What did the court decide?

State of Kerala v. P.O. Jose

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

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