IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM MONDAY, THE 28TH FEBRUARY 2011 / 9TH PHALGUNA 1932 WP(C).No. 6105 of 2011(K) ------------------------- PETITIONER(S): --------------- M/S.NEEMA BUILDERS, PATHANAMTHITTA, REPRESENTED BY T.M.MATHAI, MANAGING PARTNER. BY ADV. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON SRI.MAHESH V.MENON RESPONDENT(S): --------------- 1. COMMERCIAL TAX OFFICER (WC & LT), DEPT. OF COMMERCIAL TAXES, PATHANAMTHITTA, PIN 689645. 2. DEPUTY COMMISSIONER (APPEALS) II, DEPARTMENT OF COMMERCIAL TAXES, KOLLAM, PIN 691001. 3. THE TAHSILDAR (RR), PATHANAMTHITTA, PIN 689645. BY GOVT. PLEADER SRI.C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 28/02/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.K.ABDUL REHIM, J --------------------------------------- W.P(C) No.6105 of 2011-K ---------------------------------------- Dated this the 28th day of February, 2011. J U D G M E N T Ext.7 interim order passed by the appellate authority is in challenge in this writ petition. With respect to assessment completed for the year 2008-09, the petitioner filed Ext.P6 appeal before the 2nd respondent, along with a stay petition. The impugned order was passed by the appellate authority granting interim stay subject to condition of the petitioner remitting 30% of the balance amount due and on furnishing security for the remaining amounts. 2. According to the petitioner, the assessment was made in a quite unreasonable and arbitrary manner, adding equal sum to the reported turn over of Rs.30 lakhs through compounding the tax liability at the rate of 12.5%. Contention of the petitioner is that the addition was effected by merely observing that the petitioner had failed to produce books of accounts inspite of repeated demands. W.P(C) No.6105 of 2011-K 2 The case of the petitioner is that he had produced all documentary evidences necessary to prove through the details regarding the works undertaken by the petitioner as well as the purchases made. Further contention of the petitioner is that, the petitioner had undertaken only a works contract involving labour element and that he is entitled for compounding. Therefore, insistence for payment of 30% is an act on the part of the appellate authority without proper application of mind, is the contention. 3. While considering Ext.P7 it is noticed that, the appellate authority had categorically found that the petitioner had failed to produce books of accounts before the assessing authority, and that the statements which were alleged to have been produced could not be considered in lieu of books of accounts. Further it is observed that the records produced are only photocopies of certain documents which are not enough for finalisation of the assessment. It is also observed that the addition of equal sum on the taxable turnover reported was done by the assessing authority on the premise of lack of availability any W.P(C) No.6105 of 2011-K 3 books of accounts. 4. Learned counsel for the petitioner submits that the petitioner had already remitted a sum of Rs.91,000/- calculating tax payable at the rate of compounding, on the basis of the turnover of the contract amount. It is contended that the addition made to the turnover is totally unwarranted and without any basis. It is further contended that the petitioner is entitled for compounding since it is accepted that the work in question is only a labour contract. Under the above circumstances, it is contended that the insistence for payment of the 30% of the total amount is highly rigorous and considering the financial situations the petitioner is not in a position to comply with such condition. 5. Since the appellate authority had only exercised the discretionary power vested, I find no reason to interfere with the matter. Going by the contents of the order impugned, I am not in a position to hold that said order is issued in a mechanical manner without application of mind. However, I notice that no specific reason is stated for insisting payment of 30% of the amount. Therefore, I am of W.P(C) No.6105 of 2011-K 4 the view that interest of justice will be served if the appellate authority is directed to dispose of the appeal itself on an early basis and till such time the recovery proceedings is stayed subject to imposition of a less rigorous condition. 6. Accordingly, the writ petition is disposed of directing the 2nd respondent to consider and pass orders on Ext.P6 appeal, after affording an opportunity of hearing to the petitioner, as early as possible, at any rate within a period of two months from the date of receipt of a copy of this judgment. 7. Till such time the appeal is disposed of, in modification of Ext.P7 order, the recovery shall be kept in abeyance, subject to condition of the petitioner remitting a sum of Rs.1,50,000/- within two weeks from the date of receipt of a copy of this judgment and also on furnishing Security Bond for the balance amount within that time. C.K.ABDUL REHIM JUDGE ab