IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON TUESDAY, THE 18TH MAY 2010 / 28TH VAISAKHA 1932 OP.No. 20579 of 2001(Y) ----------------------- PETITIONER: --------------- M/S.KADAMBUKATTIL EXPORTS REPRESENTED BY THE MANAGING PARTNER, K.M.JOSEPH. BY ADV. SRI.C.K.THANU PILLAI SRI.T.K.SHAIJ RAJ RESPONDENT: --------------- 1. THE UNION OF INDIA REPRESENTED BY THE REVENUE SECRETARY, MINISTRY OF FINANCE, GOVERNMENT OF INDIA, NEW DELHI. 2. STATE OF KERALA REPRESENTED BY THE SECRETARY TO GOVERNMENT, TAXES DEPARTMENT, SECRETATRIAT, THIRUVANANTHAPURAM. 3. THE DEPUTY COMMISSWIONER, COMMERCIAL TAXES, MATTANCHERY, KOCHI-2. 4. THE ADDITIONAL SALES TAX OFFICER-1 SALES TAX OFFICE, FIRST CIRCLE,PERUMBAVOOR. ADV. SRI.THOMAS ANTONY, ADDL.CGSC SRI.THOMAS ANTONY, ADDL.CGSC SRI.DENU JOSEPH, ADDL.CGSC FOR R1 GOVERNMENT PLEADER SRI.V.K.SHAMSUDHEEN THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 17/05/2010, ALONG WITH OP NO. 33215 OF 2001 THE COURT ON 18/05/2010 DELIVERED THE FOLLOWING: P.R.RAMACHANDRA MENON, J -------------------------------------------- OP NO. 20579 OF 2001 ----------------------------------------- Dated this the 18th day of May, 2010 JUDGMENT The issue involved in this Original Petition is whether the assessing authority as well as the appellate authority were justified in demanding and realizing interest under Section 23 (3) from the 'date of the return', instead of having the same confined to the period from the date of raising the demand. 2. The case of the petitioner is that the petitioner is a dealer in plastics. In respect of the assessment year 1996-97, the 4th respondent completed the assessment as per orders dated 30.10.2000 (Exts.P1 and P2) and demand notices were issued, levying interest at the rate of 9% under Section 23 (3) of the Act and Rs.11,090/- under the CST Act. In addition to interest, the respondents demanded a balance sum of Rs.10,100/- towards the 'balance Registration fee' and a compounding fee of Rs.10,100/-, which in turn were subjected to challenge by filing STRP 3/01 and 4/01 before the 3rd respondent, who passed Ext.P3 verdict; whereby the revision petitions were turned down, sustaining the orders passed by the assessing authority. The petitioner is challenging the above orders raising many a ground in the Writ Petition. 3. The respondents have filed a counter affidavit rebutting the 2 OP No. 20579/2001 averments and allegations raised by the petitioner. The petitioner has filed a reply affidavit as well. 4. The learned counsel for the petitioner submits that the course pursued by the assessing authority as well as the appellate authority fixing huge liability upon the shoulders of the petitioners; particularly in respect of the interest to be realized from the date of return; is not correct or proper. Reliance is also placed on various decisions including the decision of the Apex Court in Maruthy Wire Industries Pvt. Ltd. Vs. Sales Tax Officer [(2001) 122 STC 410] contending that it is liable to be paid only from the date of demand. The averment made by the respondents in counter affidavit that the rate of tax is never subjected to challenge from the part of the petitioner (page 3) is also rebutted in paragraph 5 of the reply affidavit, stating that the rate of tax is very much being disputed by the petitioner and that the sales tax revision under Section 41 of the Act is pending before this Court at the instance of the petitioner, though the particulars of said case are not discernible from the reply affidavit. 5. The learned Government Pleader with specific reference to the counter affidavit, the relevant provisions of law and binding judicial precedents submits that the issue is no more open to challenge by way of the declaration of law in Chandramani Traders Vs. State of Kerala [16 VST 294]. The specific observation made by the Bench in paragraph 33 (last 3 OP No. 20579/2001 sentence) is also brought to the notice of this Court which reads as follows. “ Since the assessee had not paid tax on the admitted turnover at the specified rate of tax, this is a case where tax due under the Act is not paid and therefore, the petitioner cannot escape the rigour of the penal provision under the Act”. 6. It is pointed out that the actual rate of tax in respect of the commodity dealt with by the petitioner was 20% and the law was declared by this Court as per the decision in Maykutty Joseph Vs. State of Kerala (102 STC 79). This being the position, it was no more open to the petitioner to have paid tax at the rate of '10%' instead of satisfying the entire tax liability under the relevant provisions of law, effecting payment at the rate of 20%. It is also asserted that the version of the petitioner that the petitioner was challenging rate of tax is not correct or sustainable, as no particulars are furnished from the part of the petitioner. It is more so in view of the submissions made by the learned counsel for the petitioner that the Revision Petition filed by the petitioner under Section 41 before this Court has not been assigned any number. It is settled that a case which has not been numbered even, cannot be stated as pending, and it cannot cause any adverse consequence with regard to the rights and interest of the other party concerned. 7. With regard to the prayers raised in the Writ Petition, particularly the second prayer, the learned Government Pleader submits that the same, with regard to the challenge in respect of the retrospective levy of interest 4 OP No. 20579/2001 has been answered against the petitioner, by virtue of the decision reported in M/s. English Indian Clays Ltd. Vs. Union of India and others [13 KTR 84]. Similarly, with regard to the 3rd prayer reliance is sought to be placed on the observations made by the Division Bench in Kerala Electric Trades Association and another Vs. State of Kerala and others [2004 (12) KTR 114 (Ker)]. The position is sought to be asserted with respect to the 'compounding fee' as well, pointing out that the course pursued by the respondents is perfectly in conformity with the relevant provisions of law and the binding judicial precedents. 8. The learned Government Pleader submits on the basis of instructions obtained from the departmental authorities that, pursuant to further steps taken, the petitioner has already satisfied the entire liability as aforesaid in connection with the setting up of a new unit and that no further recovery proceedings are due. This Court finds that the legal issue stands squarely covered by the decisions referred to above, while the factual dispute stands no more germane, as the liability has already been cleared. The Original Petition is devoid of any merit. Interference is declined and it is dismissed accordingly. P.R.RAMACHANDRA MENON JUDGE dnc