IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.BALAKRISHNAN NAIR & THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN MONDAY, THE 2ND FEBRUARY 2009 / 13TH MAGHA 1930 MFA.No. 499 of 2003(F) --------------------------------- ORDER NO.21935/99/CT. DT. 11.4.02 OF THE COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM. ............... APPELLANT(S): ---------------------- M/S. GREAVES LIMITED, (FORMERLY KNOWN AS GREAVES COTTON AND CO. LTD., M.G.ROAD, ERNAKULAM REPRESENTED BY ITS BRANCH MANAGER,P.R.KRISHNAKUMAR BY MR.A.M.SHAFFIQUE, SENIOR ADVOCATE BY ADVS.MR.E.K.NANDAKUMAR MR.A.K.JAYASANKAR NAMBIAR MR.ANIL D. NAIR SMT.PRIYA MAHESH SMT.PRIYA MANJOORAN RESPONDENT(S): -------------------------- STATE OF KERALA. SPL. GOVERNMENT PLEADER K.P.PRADEEP THIS MISC. FIRST APPEAL HAVING BEEN FINALLY HEARD ON 02/02/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ORDER ON CMP. NO.2305/2003 IN MFA. NO.499/2003 Dismissed 02.02.2009 SD/- K.BALAKRISHNAN NAIR, JUDGE SD/- P.N.RAVINDRAN, JUDGE /TRUE COPY/ P.S. TO JUDGE tss K.Balakrishnan Nair & P.N.Ravindran, JJ. =============================== M.F.A. No.499 of 2003 ===================== Dated this the 2nd day of February, 2009. JUDGMENT Balakrishnan Nair,J. The appellant is a registered dealer under the Kerala General Sales Tax Act, hereinafter referred to as the “K.G.S.T. Act” for short. The Assistant Commissioner (Assmt), Special Circle-II, Ernakulam passed an order of penalty against the appellant under Section 45A of the K.G.S.T. Act vide Annexure H. The aggrieved appellant filed a revision before the Deputy Commissioner. The Deputy Commissioner allowed the revision by Annexure I order dated 19.4.1999. The Commissioner of Commercial Taxes suo motu revised the order of the Deputy Commissioner and restored the order of the Assistant Commissioner. The said proceedings of the Commissioner dated 11.4.2003 (Annexure K) suo motu revising the order of the Deputy Commissioner, was purportedly passed under Section 37 of the K.G.S.T. Act. The appellant, feeling aggrieved, has challenged that order by filing this Miscellaneous First Appeal under Section 40 of the K.G.S.T. Act. MFA 499/03 -: 2 :- 2. When the appeal was taken up for hearing, we felt that the order of the Commissioner of Commercial Taxes impugned in this appeal is one passed under Section 45A (5) of the K.G.S.T. Act and therefore, no appeal is maintainable. We heard the learned counsel appearing on both sides on the above point. 3. Section 37 of the K.G.S.T. Act reads as follows: “37. Powers of revision of the Board of Revenue suo motu: (1) The Board of Revenue may suo motu call for and examine any order passed or proceeding recorded under this Act by any officer or authority subordinate to it other than an Appellate Assistant Commissioner which in his opinion is prejudicial to revenue and may make such enquiry or cause such enquiry to be made and subject to the provisions of this Act may pass such order thereon as it thinks fit. (2) The Board of Revenue shall not pass any order under sub-section (1) if- (a) the time for appeal against that order has not expired; (b) the order has been made the subject matter of an appeal to the Appellate Assistant Commissioner or the Appellate Tribunal or of a revision in the High Court; or (c ) more than four years have expired after the passing of the order referred to therein. (2A) Notwithstanding anything contained is sub- section (2), the Board of Revenue may pass an order under sub-section (1) on any point which has not been decided in an appeal or revision referred to in Clause (b) of sub-section (2), before the the expiry of a period of one year from the MFA 499/03 -: 3 :- date of the order in such appeal or revision or before the expiry of a period of four years referred in Clause ( c) of that sub-section, whichever is later. (3) No order under this section adversely affecting a person shall be passed unless that person has had a reasonable opportunity of being heard.” The above quoted provision admittedly confers powers on the Board of Revenue (now the Commissioner of Commercial Taxes) to suo motu revise the order of the various authorities subordinate to it, other than the Appellant Assistant Commissioner. So, an order of the Deputy Commissioner is amenable to revisional powers of the Board of Revenue. As mentioned in the impugned order and the notice issued preceding it, the Commissioner of Commercial Taxes professed that he was invoking the power under Section 37 to suo motu revise the order of the Deputy Commissioner. 4. But we notice that the order of the Assistant Commissioner was one under Section 45 A(1) of the K.G.S.T. Act. We find that the said section is a self contained code. Section 45 A reads as follows: “45 A. Imposition of penalty by officers and authorities: (1) Notwithstanding anything contained in section 46 if the assessing authority or the Appellate Assistant Commissioner is satisfied that any person:- (a) being a person required to register himself as dealer under this Act, did not get himself registered; or (b) has failed to keep true and complete accounts; or ( c) has failed to submit any return as required by the MFA 499/03 -: 4 :- provisions of this Act or the rules made thereunder; or (d) has submitted an untrue or incorrect return; or (e) has failed to comply with all or any of the terms of any notice or summons issued to him by or under the provisions of this Act or the rules made thereunder; or (f) after purchasing any goods in respect of which he has made a declaration under proviso to sub-section (3) of Section 5, has failed to make use of the goods for the declared purpose; or (g) has acted in contravention of any of the provisions of this Act or any rule made thereunder, for the contravention of which no express provision for payment of penalty or for punishment is made by this Act; (h) or has abetted the commission of any of the above offences. such authority or officer may direct that such person shall pay, by way of penalty, an amount not exceeding twice the amount of Sales Tax or other amount evaded or sought to be evaded, where it is practicable to quantify the evasion or an amount not exceeding ten thousand rupees in any other case. Explanation I:- The burden of proving that any person is not liable to the penalty under this Section shall be on such person. Explanation II:- For the purposes of this sub-section the expression “assessing authority” includes any officer not below the rank of a Sales Tax Officer specified by the Government in this behalf by notification in the Gazette. (2) No order under sub-section (1) shall be passed unless the person on whom the penalty is proposed to be imposed is given an opportunity of being heard in the MFA 499/03 -: 5 :- matter. (3) The Deputy Commissioner may, on application by any person on whom the penalty is imposed under sub- section (1) within thirty days from the date of receipt by him of the order imposing such penalty, for reasons to be recorded in writing confirm, reduce or waive such penalty or remand the case to the assessing authority or Appellate Assistant Commissioner, as the case may be, for reconsideration: Provided that the Deputy Commissioner may admit an application made after the expiry of the said period of thirty days if he is satisfied that the applicant had sufficient cause for not making the application within the said period. (4) An order of the Deputy Commissioner under sub- section (3) shall, subject to the provisions of sub-section (5), be final. (5) The Board of Revenue may, either suo-motu or on an application, call for and examine the record of any order passed under sub-section (1) or sub-section (3) and make such order as it thinks fit: Provided that the Board of Revenue shall not admit an application made after the expiry of thirty days from the date of receipt by the applicant of the order under sub- section (1) or sub-section (3), as the case may be, unless it is satisfied that the applicant had sufficient cause for not making the application within the said period. Provided further that no order enhancing a penalty or cancelling the waiver of a penalty shall be passed unless that person affected thereby is given an opportunity of being heard in the matter. MFA 499/03 -: 6 :- (5A) An application under sub-section (3) shall be accompanied by a fee of rupees two hundred and that under sub-section (5) by a fee of rupees five hundred. (6) An order of the Board of Revenue under sub- section (5) shall be final.” Section 45 A(3) empowers the Deputy Commissioner concerned to revise the order of penalty under sub section (1) of Section 45 A of the K.G.S.T. Act subject to the power of review of the Board of Revenue under sub- section (5). The order of the Deputy Commissioner is made final as per sub-section (4), subject to sub-section (5). Under sub-section (5), the Board of Revenue can suo motu revise the order and pass appropriate final orders in the matter. Sub-section (6) makes the order of the Board of Revenue under sub-section (5) final, that is, there is no remedy against it under the statute. In other words, the assessee if he is aggrieved by the order under sub-section (5) of the Board of Revenue has to invoke the constitutional remedy available to him under Article 226. 5. In this case, admittedly, the order of the Commissioner of Commercial Taxes is one passed under sub-section (5) of Section 45 A of the K.G.S.T. Act, though he claimed to exercise the power under Section 37 of the K.G.S.T. Act. Quoting a wrong provision will not affect the powers of the Commissioner or the nature of the order passed by him. The powers under Sections 37 and 45 of the K.G.S.T. Act operate on different planes. Since the order under Section 45(3) of the K.G.S.T. Act has been revised the Commissioner exercising his power under Section MFA 499/03 -: 7 :- 45 (5) of the K.G.S.T. Act, no appeal under Section 40 of the K.G.S.T. Act will lie against it. In the result, the appeal is dismissed without prejudice to the contention of the appellant and its right to invoke other remedies available to it against the impugned order. K.Balakrishnan Nair, Judge. P.N.Ravindran, Judge. ess 3/2