IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON THURSDAY, THE 20TH AUGUST 2009 / 29TH SRAVANA 1931 WP(C).No. 22870 of 2009(C) -------------------------- PETITIONER: --------------- M/S.SRO.PADMABALAJI ALLOYS PVT.LTD 308/1, NIDA MENANPARA ROAD, PUDUSSERY CENTRAL VILLAGE, KANJIKODE, REP.BY ITS AUTHORISED SIGNATORE, SRI.M.S.SREEVALSAN. BY ADV. MR. RAJU JOSEPH RESPONDENT: --------------- THE COMMERCIAL TAX OFFICER-II CIRCLE, OFFICE OF THE COMMERCIAL TAX OFFICER, PALAKKAD. BY GOVERNMENT PLEADER MR. C. K. GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 20/08/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: P.R. RAMACHANDRA MENON J. ~~~~~~~~~~~~~~~~~~~~~~~ W.P. (C) No. 22870 of 2009 ~~~~~~~~~~~~~~~~~~~~~~~ Dated, this the 20th day of August, 2009 JUDGMENT The petitioner challenges Ext.P1 notice issued under Section 25 (1) of the KVAT Act proposing to finalize the assessment merely by adding some turn over, only because of the fact that the penalty orders have been issued against the petitioner in respect of the said specific instances which are already under challenge in appeal. The learned counsel for the petitioner submits that, the power under Section 25 (1) can be invoked only if there is a finding that there is any escape of turn over. No such circumstance is discernible even from Ext.P1, submits the learned counsel. It is also brought to the notice of this Court that, the first respondent has not arrived at any inference as to any instances of variation with regard to the entries in the books of accounts; which appears to be prima facie correct, in view of the fact that no such insinuation has ever been made in Ext.P4, but for effecting four additions as it appears in the last page of Ext.P1, which are very much accountable in respect of instances for which the penalty has been imposed. 2. Heard the learned Government Pleader as well, who made submissions on the basis of the statement filed on behalf of the WP (C) No. 22870 of 2009 : 2 : respondent, sustaining the course adopted by the respondent and pointed out that, altogether 9 cases are still pending against the petitioner and that the petitioner is practising the same course of events, suppressing the manufacture and sales, seeking evasion of tax. 3. Considering the facts and circumstances, the reasons stated for issuing notice under Section 25 (1) and since the addition as specified therein does not refer to any specific instances of escaped turn over as revealed from the 'books of accounts' of the petitioner, the version put forth by the petitioner appears to be more plausible and probable at the first sight. It is also brought to the notice of this Court that the petitioner has already filed Ext.P2 reply in response to Ext..P1 notice and the only relief now prayed for is to defer the finalization of Ext.P1, till the proceedings in appeal challenging the orders imposing penalty attain finality. Such course was pursued by this Court on an earlier occasion as well, vide Ext.P3 judgment in WP (C) 31816 of 2008 preferred by the petitioner. 4. In the above circumstance, the first respondent is directed to ensure that no final orders are passed pursuant to Ext.P1 till the appeals against the orders imposing penalty are finalized. It is also made clear that this Court has not expressed anything on the merits involved. WP (C) No. 22870 of 2009 : 3 : The Writ Petition is disposed of accordingly. P. R. RAMACHANDRA MENON, JUDGE kmd