IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 4TH NOVEMBER 2010 / 13TH KARTHIKA 1932 WP(C).No. 29416 of 2010(B) ---------------------------------------- PETITIONER(S): ------------------------ A.NILAVARNEESA SAJITHA TRADERS, M.PUDUR, GOVINDAPURAM PO., PALAKKAD DISTRICT. BY ADVS. SRI.HARISANKAR V. MENON, SMT.MEERA V.MENON, SRI.MAHESH V.MENON. RESPONDENT(S): --------------------------- 1. COMMERCIAL TAX OFFICER II, CHITTUR - 678 101. 2. COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM PIN 695 001. 3. STATE OF KERALA, REPRESENTED BY ITS SECRETARY, TAXES DEPARTMENT, GOVERNMENT SECRETARAIT,THIRUVANANTHAPURAM 695 001. R1 TO R3 BY SR.GOVERNMENT PLEADER SRI.C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 04/11/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.29416 of 2010 ------------------------------------------- Dated this the 4th day of November, 2010 J U D G M E N T ---------------------- The petitioner who is a dealer under the Kerala General Sales Tax Act (KGST Act) had applied for settlement of arrears of sales tax due with respect to assessment years 1995-'96 and 1996-'97, under the Amnesty Scheme. Through Ext.P4 order, the 1st respondent had rejected the application observing that the Amnesty Scheme is not applicable to those cases in which land was attached and taken as bought-in-land. The rejection was made relying on Circular No.13/08 issued by the 2nd respondent, which is produced as Ext.P5. 2. Before rejecting the application for Amnesty benefit, the petitioner was issued with a notice stating that the Government had bid in auction the land belonging to the petitioner, as per order of the Revenue Divisional Officer, Palakkad, and the present market value of the land is reported as Rs.29,15,080/-. Therefore in such cases the settlement amount could not be fixed at less than the value of the attached assets. Ext.P2 is the proposal notice for rejection of the application. W.P.(C).29416/10-B -2- 3. In Ext.P3, the petitioner replied that Ext.P5 circular was issued on the basis of Finance Bill 2008 which contained a provision to the effect that when there is an attachment of any immovable property then the settlement under the Amnesty Scheme shall not be made for any amount less than the value of such assets. But in the Finance Act 2008, such restriction was not incorporated and Section 23B of the KGST Act does not stipulate any such restriction. Hence the reasons proposed are not sustainable. 4. But in Ext.P4 the 1st respondent observed that, nowhere in the provisions of the Amnesty Scheme it is stated that the scheme is applicable to those cases in which land was attached and taken as 'bought-in-land'. The above reasoning for rejection of the benefit of the Amnesty Scheme is assailed in this writ petition, as totally illegal and unsustainable. 5. It is pertinent to note that the land in question was attached pursuant to a proceedings initiated under the Kerala Revenue Recovery Act, 1968. The land was purchased by the Government invoking Section 50 of the said Act and the sale now stands confirmed by virtue of proceedings issued by the Revenue Divisional Officer. Therefore the property in question now stands vested in the Government. Whether the property is liable to be re-conveyed, on settlement of the arrears, is a question W.P.(C).29416/10-B -3- which need be considered depending on the provisions contained in the Kerala Revenue Recovery Act and also depending on the policy decisions of the Government. Amnesty Scheme for settlement of tax arrears is provided under the provisions of Section 23B of the KGST Act. Even assuming that there is any restriction for settlement of arrears below the value of property owned by the defaulter, which is under attachment, such restriction could not be urged in a case where the property has already been purchased by the State Government. In such case the bought-in-land remains not as an asset belonging to the defaulter and there is no meaning in observing that settlement could not be made for any amount less than the value of such property. The question as to whether the petitioner will seek re- conveyance of the land, once the arrears is settled, is not a matter which is to be taken note of while permitting settlement under the Amnesty Scheme. 6. Under the above circumstances I am of the view that the reasoning in Ext.P4 has no backing of law prevalent on the subject. Therefore the impugned decision needs reconsideration. 7. In the result the writ petition is allowed. Ext.P4 is hereby quashed. The 1st respondent is directed to consider Ext.P1 application submitted by the petitioner, and to take a fresh decision considering eligibility of the petitioner for W.P.(C).29416/10-B -4- permitting settlement of the arrears under the Amnesty scheme, taking note of the observations contained herein above. 8. A decision in this regard shall be taken and intimated to the petitioner at the earliest possible, at any rate, within a period of two weeks from the date of receipt of a copy of this judgment. C.K.ABDUL REHIM, JUDGE. okb