IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE THE CHIEF JUSTICE MR.H.L.DATTU & THE HONOURABLE MR. JUSTICE K.M.JOSEPH MONDAY, THE 10TH MARCH 2008 / 20TH PHALGUNA 1929 W.A.No. 486 of 2008 ------------------------------------ AGAINST THE JUDGEMENT IN WPC.2120/2008 DATED 12/02/2008 .................... APPELLANT/PETITIONER: ------------------------------------- SMT. SUJA MATHEW, PROPRIETRIX, S.M. CONVERSIONS, UDUMPANNOOR, THODUPUZHA. BY ADVS. SRI.T.M.SREEDHARAN & SRI.V.P.NARAYANAN RESPONDENTS/RESPONDENTS: ----------------------------------------------- 1. ADDL.AGRICULTURAL INCOME TAX & SALES TAX OFFICER, IIND CIRCLE, THODUPUZHA. 2. THE DEPUTY TAHSILDAR (RR), THODUPUZHA. 3. THE STATE OF KERALA, REPRESENTED BY CHIEF SECRETARY, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM. 4. THE GENERAL MANAGER, DISTRICT INDUSTRIES CENTRE, IDUKKI. BY SR.GOVERNMENT PLEADER MR.MUHAMMED RAFIQ THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 10/03/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: H.L.DATTU, C.J. & K.M.JOSEPH, J. ------------------------------------------------------ W.A.No.486 of 2008 ------------------------------------------------------- Dated, this the 10th day of March, 2008 JUDGMENT H.L.Dattu, C.J. Though the matter is listed for admission, by consent of the learned counsel for the parties to the lis, the matter is taken up for final hearing, since the issues involved in this case lies in a narrow compass. (2). The petitioner is a dealer registered under the provisions of the Kerala General Sales Tax Act and Central Sales Tax Act. She is engaged in processing of paper to make it fit for use in computer, fax machines etc. Petitioner's unit is also a small scale industrial unit. (3). In the writ petition filed, the petitioner primarily called in question Exts.P1 and P2 notices issued by the Additional Agricultural Income Tax & Sales Tax Officer, II Circle, Thodupuzha for the assessment year 1999- 2000 and for the months of April, May, June and July, 2000. (4). Apart from others, Sri.T.M.Sreedharan, learned counsel appearing for the appellant/petitioner would submit, that the respondent authority without passing either the provisional assessment order or final assessment order could not have issued the impugned demand notices for the assessment year 1999-2000 and for the months of April 2000 to July 2000. Therefore, it is stated that the notices issued by the respondent is contrary to the statutory provisions. (5). One of the prayers in the writ petition was to direct the W.A.No.486/2008 -2- respondent to furnish to the petitioner the assessment orders passed prior to the issuance of Exts.P1 and P2 demand notices. (6). When the matter had been posted before the Court for admission, we had directed Sri.Muhammed Rafiq, learned Government Pleader to get instruction from the respondents. (7). Sri.Muhammed Rafiq, learned Government Pleader, on instruction, would submit that the respondents have not passed any provisional or final assessment order. It is also brought to our notice by the learned Government Pleader that a request had been made by the petitioner for deferment of the assessment proceedings for the assessment years in question, and, in fact, this Court in O.P.No.7444/2001 disposed of on 5th March, 2001 had directed the assessing authority to defer the assessment till the claim of the petitioner before the Deputy Commissioner is disposed of one way or other. (8). In the petition, as we have already noticed, the primary grievance of the petitioner was that, without passing either the provisional assessment order or final assessment order for the assessment year 1999- 2000 and for the months of April 2000 to July 2000, the respondent authority could not have issued the impugned demand notices. (9). Admittedly, the petitioner filed her annual returns for the assessment year 1999-2000 and monthly returns for the months of April 2000 to July, 2000. In all these annual returns, while conceding the total and taxable turnover, the assessee had claimed exemption from payment of tax on the ground that there is no manufacturing activity involved as such in W.A.No.486/2008 -3- processing the papers to make it fit for use in computers and fax machines etc. We are not prepared to answer the afore-said contention of the petitioner. We are considering in this case, whether the authorities under the Act are justified in issuing the demand notices without there being either the provisional assessment order or final assessment order. Admittedly, in the two cases, the assessing authority has not passed either the provisional assessment order or final assessment order. The Act contemplates that an assessment order either provisional or final, requires to be passed and thereafter, the demand notices could be issued. Since that has not been done in the instant case, we entertain this appeal and set aside the demand notice issued by the respondent authority for the assessment year 1999-2000 and demand notice issued for the months of April 2000 to July, 2000. We reserve liberty to the assessing authority to quantify the tax liability for the assessment year 1999-2000 and also for the months of April 2000 to July 2000 after issuing pre-assessment notice to the petitioner and after considering the objections that may be filed by the petitioner. Accordingly, we pass the following: Order i). The writ appeal is allowed. ii). The order passed by the learned Single Judge is set aside. The demand notices issued by the respondent authority for the assessment year 1999-2000 and also for the months of April 2000 to July 2000 are set aside. W.A.No.486/2008 -4- iii). Liberty is reserved to the respondent authority to quantify the tax liability of the petitioner for the assessment years in question after issuing notice and after affording an opportunity of being heard to the petitioner. iv). Liberty is also reserved to the appellant/petitioner to produce all such materials which are available in her custody at the time of hearing of the matter by the assessing authority. (10). Consequently, I.A.No.265/2008 is closed. Ordered accordingly. (H.L.DATTU) CHIEF JUSTICE (K.M.JOSEPH) JUDGE MS/DK