K.N.ANIRUDHAN V. THE AGRICULTURAL INCOME TAX & COMMERCIAL TAX OFFICER

WP(C)/8794/2017

AI Insights

The case involves K.N. Anirudhan, the proprietor of M/s. Appas Labhakkada, who challenged the assessment order issued for the year 2014-15 under the Kerala Value Added Tax Act, 2003. The petitioner had previously availed an amnesty scheme for the years 2011-12 to 2014-15, which included the payment of dues. Despite this, an assessment notice was issued based on an audit, leading to a higher tax demand than what was communicated to the petitioner. The court examined whether the amnesty scheme precluded further assessments and found that the petitioner, having complied with the amnesty terms, should not face additional assessments for the period covered under the scheme.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 766913 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 30-03-2017
• Assessment Year: misc
• Other Referred Cases: M/s.Yogesh Trading Company v. State of Kerala
• Laws Referred To: Kerala Value Added Tax Act, 2003
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: V K SHAMSUDDIN
• Assessee Lawyers: A KRISHNAN
• Keywords: Amnesty Scheme; Audit assessment; Natural Justice; Presumptive dealer; Suppression
• Section: 24; 6.5%

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT:- THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN THURSDAY, THE 30TH DAY OF MARCH 2017/9TH CHAITHRA, 1939 W.P(C).No.8794 of 2017 (Y) --------------------------- PETITIONER(S):- ---------------- K.N.ANIRUDHAN, AGED 66 YEARS, S/O.NEELAKANTAN PANICKER, PROPRIETOR, M/S.APPAS LABHAKKADA, (FORMERLY APPAS AGENCIES) ZILLA COURT WARD, ALAPPUZHA. BY ADV. SRI.A.KRISHNAN. RESPONDENT(S):- --------------- 1. THE AGRICULTURAL INCOME TAX & COMMERCIAL TAX OFFICER, COLLECTORATE, ALAPPUZHA-688001. 2. STATE OF KERALA, REPRESENTED BY THE SECRETARY, COMMERCIAL TAXES DEPARTMENT, THIRUVANANTHAPURAM, PIN-695 001. R1 & R2 BY GOVERNMENT PLEADER SRI.V.K.SHAMSUDDIN. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 30-03-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.8794 of 2017 (Y) --------------------------- APPENDIX PETITIONER(S)' EXHIBITS:- ------------------------- P1 : TRUE COPY OF THE NOTICE DATED 14-9-2015. P2 : TRUE COPY OF AMNESTY SCHEME DATED 27-8-2016. P3 : TRUE COPY OF THE ORDER DATED 7-12-2016 UNDER EXT P2 SCHEME FOR THE PERIOD FROM 2011-12 TO 2014-15. P4 : TRUE COPY OF THE ORDER DATED 14-12-2015. P4(a) : TRUE COPY OF THE DEMAND NOTICE. P5 : TRUE COPY OF THE REPLY DATED 2-1-2017. RESPONDENT(S)' EXHIBITS:- ------------------------ NIL. Vku/- [ true copy ] K. Vinod Chandran, J ---------------------------------------- W.P.(C) No.8794 of 2017-Y ---------------------------------------- Dated this the 30th day of March, 2017 JUDGMENT The petitioner is aggrieved with the assessment order at Exhibit P4 for the year 2014-15, which was regularly carried out under Section 24 of the Kerala Value Added Tax Act, 2003 [for brevity “KVAT Act”]. 2. The petitioner was a presumptive dealer who had admittedly made some suppression in the years 2011-12 to 2014-15. The suppression in each year would indicate that in each of the said years, the turnover of the petitioner would go beyond the presumptive limit as provided in Section 6(5) of the KVAT Act. The Government finding a number of such presumptive dealers having practised suppression and exceeded the turnover limit, brought out Circular No.17/2016 dated 27.08.2016, produced as Exhibit P2. The petitioner applied for amnesty under the Scheme and was granted the same for the years 2011-12 to 2014-15. The order of amnesty is found at Exhibit P3. The amounts demanded were paid up by the petitioner. WP(C) No.8794 of 2017 - 2 - 3. Even prior to the amnesty order dated 07.12.2016, a notice under Section 24 was issued on audit assessment, as per Exhibit P1. The amnesty order at Exhibit P3 specifically provided that the assessment under Section 24 for the year 2014-15 is not correlated with this. The pre-assessment notice at Exhibit P1 was proceeded with and orders issued at Exhibit P4; which is impugned herein. 4. The first contention raised by the petitioner against the assessment made is that having paid tax under the amnesty scheme, there is no scope for carrying out any further assessment under Section 24. The next contention is with respect to the notice having indicated a proposal of additional tax of Rs.2,71,251/-, while the original order demanded an amount of Rs.5,38,106/-. The excess amount demanded was not intimated to the petitioner and the same was bad for reason of violation of principles of natural justice. 5. The learned Government Pleader, however, contends on the basis of the Division Bench decision of this Court in S.T.Rev. No.51 of 2012 dated 09.10.2013 [M/s.Yogesh WP(C) No.8794 of 2017 - 3 - Trading Company v. State of Kerala] that if at all a suppression is detected, then necessarily the turnover exceeding the presumptive limit would have to be taxed at the regular rates. It is also contended that the order at Exhibit P3 specifically saved the assessment under Section 24 for the year 2014-15. 6. The Division Bench judgment would not be applicable in the present case insofar as the Government itself having brought out an amnesty scheme, by which the presumptive dealers were directed to be granted relief insofar as complying with the terms as is seen from Exhibit P2. However, it is also seen that the presumptive dealer/petitioner, who was registered with PIN number had converted to a regular dealership with TIN number from 01.01.2015. Even then, the assessment under Section 24 should have been done only for the period 01.01.2015 to 31.03.2016. The amnesty applied for and amounts remitted by the petitioner for the year 2014-15, while he remained under the presumptive net cannot be disturbed. 7. In the above circumstance, Exhibit P4 assessment order is set aside. The Assessing Authority shall issue a fresh WP(C) No.8794 of 2017 - 4 - notice, if so advised, for the period commencing from 01.01.2015; for the balance period in the said assessment year after verifying the books of accounts. The petitioner shall co-operate with the proceedings. The assessment shall be finalised in accordance with law. The writ petition would stand allowed to the above extent. Sd/- K.Vinod Chandran Judge. vku/- [ true copy ] "