IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM FRIDAY, THE 4TH MARCH 2011 / 13TH PHALGUNA 1932 WP(C).No. 5021 of 2011(C) ------------------------- PETITIONER(S): --------------- K.K.PURUSHOTHAMAN, GREEN POINT INTERIORS, ENGANDIYOOR-680 615. BY ADV. SRI.K.I.MAYANKUTTY MATHER SRI.R.JAIKRISHNA RESPONDENT(S): --------------- 1. COMMERCIAL TAX OFFICER-I, DEPARTMENT OF COMMERCIAL TAXES, CHAVAKKAD – 680 506. 2. DEPUTY COMMISSIONER (APPEALS), ERNAKULAM – 682 031. 3. INSPECTING ASSISTANT COMMISSIONER, IRINJALAKUDA – 680 121. BY SR.GOVT. PLEADER SRI.C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 04/03/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.K.ABDUL REHIM, J --------------------------------------- W.P(C) No.5021 of 2011-C ---------------------------------------- Dated this the 4th day of March, 2011. J U D G M E N T By virtue of Exts.P3 and P4 orders, assessments were finalised against the petitioner with respect to the years 2003-04 and 2004-05. Statutory appeals were filed against the assessments, before the 2nd respondent, as evidenced from Exts.P6 and P7. Interim orders passed by the 2nd respondent as per Exts.P8 and P9, while disposing the stay petitions filed along with the appeals, are challenged in this writ petition. The appellate authority, while disposing the stay petitions had granted interim stay, subject to condition of the petitioner remitting 50% of the amount due, in Ext.P8 order, and 40% of the amount due, in Ext.P9 order along with the conditions to furnish adequate security for the balance amount. 2. According to the petitioner the condition for payment was imposed in a mechanical manner without proper application of mind and without adverting to the W.P(C) No.5021 of 2011-C 2 contentions raised, in its real perspective. 3. It is noticed that, the specific contention of the petitioner is that his tax consultant, one Sri.Gimson George, with whom the petitioner had entrusted matters relating to registration and filing of returns, had committed fraud on the petitioner through malpractice by misutilising the Form 18 declarations and Delivery Notes and by conducting large volume of business by using such documents. The petitioner had produced proof to the effect that a criminal complaint was instituted against the persons, who were involved in such malpractice and fraud, before the Judicial First Class Magistrate Court, Chavakkad and the matter is now in seizin of the said Court. It is further contended that inspite of specific allegation raised in this regard before the appellate authority and on production of proof regarding filing of such criminal complaint, the authority took a view that the petitioner had failed to prove any material evidence that the transactions were conducted by anybody else through malpractice. Further contention raised by the petitioner is that the business concern of the petitioner is a W.P(C) No.5021 of 2011-C 3 registered unit under the Khadi and Village Industries Board and as such he was entitled for exemption from payment of tax. The certificate issued by the Kerala Khadi and Village Industries Board (Ext.P2) was also produced in this regard. 4. On a perusal of the impugned interim order, it is revealed that the appellate authority had illustrated all the main contentions raised. It was observed that the petitioner had failed to produce books of accounts and other documents before the assessing authority in relation to the turn over which were unearthed through declaration obtained from the check post. It is further observed that the petitioner could not produce any materials to prove the eligibility for exemption from payment of tax. Therefore the conditions were imposed. 5. It is evident that the appellate authority had gone into the main contentions raised and had expressed prima facie opinion regarding those contentions. As such I am of the view that the interim order could not be classified as one issued without application of mind or without W.P(C) No.5021 of 2011-C 4 advertance to the contentions raised. However, it is noticed that the appellate authority has not mentioned any specific reason for imposing the condition for payment to extent as mentioned in Exts.P8 and P9, inspite of the specific findings arrived to the effect that the petitioner was successful in establishing a prima facie case. 6. Learned counsel for the petitioner submits that the petitioner was totally innocent and he had not done any volume of business as alleged in the order of assessment. It is due to malpractice, cheating and fraud committed by others that the petitioner was held liable. In order to prove the real facts, the petitioner had already taken steps before the appropriate authority and under such circumstances, the condition imposed will cause onerous liability, which according to him is totally unworkable, considering the present financial situation. 7. On a consideration of circumstances contained in this case, I am of the view that interest of justice will be served, if a direction is issued to the appellate authority to dispose of the appeals on an early basis and till then to W.P(C) No.5021 of 2011-C 5 restrain the recovery steps, subject to imposition of the less rigorous conditions. 8. Therefore the writ petition is disposed of directing the 2nd respondent to consider and pass orders on Exts.P6 and P7 appeals, 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. 9. Till such time the appeals are disposed of as directed above, recovery of amounts covered under Exts.P3 and P4 shall be kept in abeyance, subject to conditions incorporated in modification of Exts.P8 and P9. If the petitioner makes payment of 20% of the amounts due under the respective orders of assessments, and also furnishes Security Bond for the balance amount, within two weeks from the date of receipt of a copy of this judgment, further recovery steps shall be kept in abeyance till the disposal of appeals. C.K.ABDUL REHIM, JUDGE W.P(C) No.5021 of 2011-C 6 ab