K.RAGHUNATHAN V. DEPUTY COMMISSIONER

WP(C)/4372/2021

AI Insights

The case involves K. Raghunathan, the proprietor of K.R. Inn, who contested the conditional stay imposed by the Kerala Agricultural Income Tax and Sales Tax Appellate Tribunal on his appeal against a tax assessment for the year 2013-14. The Tribunal's stay order required him to pay 30% of the tax demand and secure the remaining amount with a bond, citing no legal issues and concurrent findings by the lower authorities. Raghunathan challenged this order, arguing it lacked sufficient reasoning, referencing the Archana Agencies case which emphasized the need for reasoning in such orders. The High Court, however, found the Tribunal's decision reasonable and dismissed the petition, allowing the petitioner to seek installments and an expeditious hearing of the appeal.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 726554 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 19-02-2021
• Assessment Year: misc
• Other Referred Cases: Archana Agencies Vs. Commercial Tax Officer 2014(2) KLT 715
• Laws Referred To: KGST Act, 1963
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: THUSHARA JAMES
• Assessee Lawyers: TOMSON EMMANUEL
• Keywords: Appeal; Conditional stay; Goods and Services Tax; Stay Petition; Tax assessment
• Section: 17(3)

Judgement Text

"IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE A.M.BADAR FRIDAY, THE 19TH DAY OF FEBRUARY 2021 / 30TH MAGHA,1942 WP(C).No.4372 OF 2021(V) PETITIONER/S: K.RAGHUNATHAN, PROPRIETOR, M/S. K.R. INN, DOOR NO. 7/274E, PERUMPILAVU, KARIKKAD P.O. THRISSUR DISTRICT 680 519. BY ADV. SRI.TOMSON T.EMMANUEL RESPONDENT/S: 1 DEPUTY COMMISSIONER, FORMERLY, ASSISTANT COMMISSIONER, STATE GOODS AND SERVICES TAX DEPARTMENT, SPECIAL CIRCLE, PUTHOLE, THRISSUR 680 004. 2 INTELLIGENCE OFFICER, SQUAD NO. IV, STE GOODS AND SERVICES TAX COMPLEX, PUTHOLE, THRISSUR 680 004. 3 DEPUTY COMMISSIONER (APPEALS), STATE GOODS AND SERVICES TAX COMPLEX, POOTHOL, THRISSUR 680 004. 4 THE KERALA VALUE ADDED TAX APPELLAE TRIBUNAL, THEVARA, ERNAKULAM, COCHIN 682 015. 5 DEPUTY COMMISSIONER, STATE GOODS AND SERVICES TAX COMPLEX, POOTHOL, THRISSUR 680 004. GP- SMT. THUSHARA JAMES THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19.02.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No.4372 OF 2021 2 JUDGMENT Dated this the 19th day of February 2021 Heard learned Counsel appearing for the petitioner. Learned Counsel for the petitioner drew my attention to the 1st appellate order as well as the order on the stay petition at Ext.P7, passed by the 2nd appellate authority, and argued that the appellate authority has disposed of the stay petition filed by the petitioner by holding that the petitioner has a prima facie case, but at the same time, directing the petitioner to pay 30% of the existing demand and by adding further direction to execute a bond for the balance amount before the assessing authority. Learned Counsel for the petitioner placed reliance on judgment of this Court in the matter of Archana Agencies Vs. Commercial Tax Officer 2014(2) KLT 715, wherein, this Court has held that the stay order must be a recent order. With this, learned Counsel for the petitioner submits that the impugned order WP(C).No.4372 OF 2021 3 granting conditional stay needs to be quashed and set aside. In the alternative, learned Counsel for the petitioner further argued that the appeal be directed to be heard expeditiously. 2. Learned Government Pleader appears for the respondents. 3.I have considered the submissions so advanced and perused the material placed before me. 4. The petitioner who is an assessee engaged in sale of cooked food, soft drinks and Indian Made Foreign Liquor, submitted the return for the assessment year 2013-14 under section 17(3) of the KGST Act, 1963. The assessing authority completed the assessment, and feeling aggrieved by the said assessment, the petitioner had preferred an appeal before the 1st appellate authority, i.e., the Deputy Commissioner (Appeals). By this order, the 1st appellate authority had modified the assessment by directing that the tax paid by the petitioner before the Intelligence Wing should be given due credit. However, rest of the prayers made by the petitioner WP(C).No.4372 OF 2021 4 were rejected and that is how the petitioner preferred an appeal before the Kerala Agricultural Income Tax and Sales Tax Appellate Tribunal. The appeal was accompanied by the said petition and the learned Tribunal decided that the said petition by the impugned order at Ext.P7, which according to the learned Counsel for the petitioner is bereft of any reason and as such, is not sustainable. 5. In the matter of Archana Agencies, this Court has held that, in taxation matters, reasons must support not only the decision to waive payment of amounts due but also the decision that directs an assessee to make some payment pending consideration of the appeal. If the conditional order granting stay is bereft of reasons then the such orders cannot be sustained. However, at the same time, this Court has clarified that the requirement of giving reason also includes minimal reason for granting stay. In this context, it is relevant to quote paragraph No.5 of the impugned order granting conditional stay. “5. On going through the appeal, we find WP(C).No.4372 OF 2021 5 that stay is to be granted till the disposal of the appeal. In view of the concurrent findings of the authorities below and the merits of the contentions raised by the petitioner and the fact that no legal issue is involved in this appeal, stay can be granted only on payment of 30% of the existing demand and on executing bond for the balance amount before the assessing authority.” 6. Perusal of paragraph 5 makes it clear that the learned appellate Tribunal has held that no question of law is involved in the appeal. Learned Tribunal was aware of the fact that there is concurrent findings by atleast two authorities. In this backdrop, learned Tribunal observes that the stay can be granted only on payment of 30% of the existing demand. This in my considered opinion, constitute sufficient reasons for imposing condition for directing the petitioner to pay 30% of the existing demand. In this view of the matter, it is not possible to interfere in the impugned order which is an interim order passed in an appeal. WP(C).No.4372 OF 2021 6 The petition therefore fails and the same is dismissed. Petitioner is at liberty to seek instalments if any and for expeditious hearing of the appeal, before the learned appellate Tribunal. Sd/- A.M.BADAR JUDGE uu 19.2.2021 WP(C).No.4372 OF 2021 7 APPENDIX PETITIONER'S/S EXHIBITS: EXHIBIT P1 TRUE COPY OF ORDER DATED 02.05.2018 COMPLETED BY 1ST RESPONDENT, FOR THE YEAR 2013-14 IN ESTIMATING 66% GROSS PROFIT TO ESTIMATE SALES TURNOVER OF IMFL. EXHIBIT P2 TRUE COPY OF APPEAL SUBMITTED AGAINST EXT P1 ORDER BEFORE 3RD RESPONDENT. EXHIBIT P3 TRUE COPY OF APPELLATE ORDER PASSED BY 3RD RESPONDENT IN EXT P2 APPEAL. EXHIBIT P4 TRUE COPY OF FORM NO. 32 2ND APPEAL DATED 06.10.2002 SUBMITTED BY PETITIONER BEFORE 4TH RESPONDENT CHALLENING EXT. P3 1ST APPELLATE ORDER. EXHIBIT P5 TRUE COPY OF AFFIDAVIT AND PETITION FOR STAY DATED 06.10.2020 SUBMITTED BY PETITIONER ALONG WITH EXT. P4 APPEAL, BEFORE TH RESPONDENT. EXHIBIT P6 TRUE COPY OF MODIFIED ASSESSMENT ORDER PASSED BY 1ST RESPONDENT PURSUANT TO EXT P3 1ST APPELLATE ORDER. EXHIBIT P7 TRUE COPY OF MECHANICAL CONDITIONAL STAY ORDER DATED 04.02.2021, COMMUNICATED TO PETITIONER ON 13.02.2021 BY 3RD RESPONDENT IN EXT. P5 STAY PETITION. EXHIBIT P8 TRUE COPY OF JUDGMENT OF THIS HONBLE COURT IN ARCHANA AGENCIES V/S. COMMERCIAL TAX OFFICER REPORTED IN 2014 (2) KLT 715). EXHIBIT P9 TRUE COPY OF JUDGMENT DATED 20.10.2002 IN ST REV. NO. 13 OF 2020 PASSED BY DIVISION BENCH OF THIS HONBLE COURT. "