A sales tax revision challenge by a dealer against a Tribunal order was dismissed. The Court followed a Full Bench judgment interpreting the calculation of highest turnover tax payable under Section 7(b) of the KGST Act, ruling the argument against the department was untenable.
S.T. Revision stands dismissed.
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 S.V.BHATTI
&
THE HONOURABLE MR.JUSTICE BASANT BALAJI
WEDNESDAY, THE 3RD DAY OF AUGUST 2022 / 12TH SRAVANA, 1944
ST.REV. NO. 4 OF 2021
AGAINST THE ORDER/JUDGMENTTA 49/2018 OF AGRL.I.T.ADDITIONAL
BENCH,KOZHIKODE
PETITIONER/S:
SOLAR HOTELS (P) LIMITED PAVARATTY, THRISSUR - 680 507. (REPRESENTED BY THE DIRECTOR SRI.K.B.PADMADAS).
BY ADVS. K.N.SREEKUMARAN SRI.P.J.ANILKUMAR (A-1768) SRI.N.SANTHOSHKUMAR
RESPONDENT/S:
STATE OF KERALA REPRESENTED BY SECRETARY TO GOVERNMENT, TAXES DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM - 695 001.
BY ADV GOVERNMENT PLEADER
THIS SALES TAX REVISION HAVING COME UP FOR ADMISSION ON 03.08.2022,
THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
S.T.(Rev.) No.4/2021
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J U D G M E N T
S.V. Bhatti, J.
Heard Advocate Mr K N Sreekumaran and Sr. Government Pleader Mr Shamsudheen V K for parties.
“16. We are afraid the said argument omits to take note of the factors on which the highest turnover tax is determinable. Construed literally, the word highest is comparing all the three situations. The word ‘paid’ is in the company of words “turnover
S.T.(Rev.) No.4/2021
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tax” which means the tax permitted to be paid in the previous year at a compounded rate. The authority verifies the highest tax payable as conceded in the returns or accounts on one hand and turnover tax paid on the other hand whichever is the highest among the three, the applicable percentage viz. 115% is applied and compounded rate for the subsequent year is accepted. The construction as commended to the Court by Mr Harisankar, we are afraid, will efface the clear expression in Section 7(b), viz. highest turnover tax payable as conceded in the return/accounts. ‘Payable’ is understood in the company of the return or accounts and ‘paid’ is understood in the company of the turnover tax. By applying the rule of Noscitur-a-sociis , we hold that for the purpose of Section 7(b) the turnover tax payable by the dealer as conceded either in the return or accounts or the turnover tax paid for the previous consecutive three years is the deciding factor. So interpreted, we hold that the construction adopted by the Tribunal which reads as follows is the correct and literal construction available in the circumstances of the case.
“The State contends that TOT payable as per accounts is to be taken for calculating TOT. Respondents contention is that it is to be done on the basis of return. On a perusal of relevant provision, it is very clear that the clause applicable to this assessee is clause (b) of Sec.7. In clause (b) itself, 3 situations arise.
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The question is answered as indicated above…..”
The principle laid down in the Full Bench since applies in all fours, the instant questions of law, by following the Full Bench,
are answered against the dealer, in favour of the Department.
S.T. Revision stands dismissed consequently.
S.V.BHATTI
JUDGE
BASANT BALAJI
JUDGE
jjj
S.T.(Rev.) No.4/2021
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APPENDIX OF ST.REV. 4/2021
PETITIONER ANNEXURES
ANNEXURE A TRUE COPY OF THE ASSESSMENT ORDER NO.25181553/2011-12 DATED 5/1/2016 OF THE ASSISTANT COMMISSIONER, COMMERCIAL TAXES, SPECIAL CIRCLE, THRISSUR. ANNEXURE B TRUE COPY OF THE ORDER DATED 20/1/2017 IN KVATA 1210/2016 ISSUED BY THE DEPUTY COMMISSIONER (APPEALS), COMMERCIAL TAXES, THRISSUR. ANNEXURE C TRUE COPY OF THE COMMON ORDER NO.48/2018, 49/2018 & 50/2018 DATED 28/2/2020 OF THE HON'BLE KVAT TRIBUNAL, KOZHIKODE SERVED ON THE PETITIONER ON 15/9/2020. ANNEXURE D TRUE COPY OF THE REFERENCE ORDER DATED 22/8/2019 IN OT(REV.) 75/2018 AND OTHERS OF THIS HON'BLE COURT.
1 issue framed by the court
Whether the Full Bench decision interpreting Section 7(3) of the KGST Act and the method for calculating highest turnover tax applies to the present case.
Colour shows how this judgement treated each authority
S.T. Rev. No.21/2014 dated 06.04.2022Followed¶24
1 provisions across 1 enactments
Solar Hotels (P) Limited
State of Kerala
S.V.Bhatti
Basant Balaji
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
