IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.M.JOSEPH MONDAY, THE 10TH NOVEMBER 2008 / 19TH KARTHIKA 1930 WP(C).No. 32976 of 2008(A) -------------------------- PETITIONER(S): --------------- SMT.M.A.SUHARA, PROPRIETRIX, STAR AGENCIES, MATHILAKAM.P.O, THRISSUR. BY ADV. SRI.SHAIJAN C.GEORGE SRI.JOHN VIPIN SMT.S.A.SHERLY SMT.SAJITHA GEORGE SMT.REKHA RESPONDENT(S): --------------- 1. STATE OF KERALA, REPRESENTED BY CHIEF SECRETARY, GOVERNMENT OF KERALA, THIRUVANANTHAPURAM. 2. COMMISSIONER, COMMERCIAL TAXES, THIRUVANANTHAPURAM. 3. DEPUTY COMMISSIONER (APPEALS), COMMERCIAL TAXES, ERNAKULAM. 4. COMMERCIAL TAX OFFICER (AA),COMMERCIAL TAXES, THRISSUR. 5. COMMERCIAL TAX OFFICER, COMMERCIAL TAXES KODUNGALLUR. 6. INSPECTING ASSISTANT COMMISSIONER, COMMERCIAL TAXES, MINI CIVIL STATION, IRINJALAKUDA. BY GOVERNMENT PLEADER ADV.SRI.C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 10/11/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K.M. JOSEPH, J. ```````````````````````````````````````````````````` W.P.(C) No. 32976 OF 2008 A ```````````````````````````````````````````````````` Dated this the 10th day of November, 2008 J U D G M E N T Petitioner challenges Ext.P2 circular and seeks to quash Exts.P4 to P9 finding that it is ill based and violative of natural justice. Ext.P10 is also challenged. Case of the petitioner is as follows. Petitioner deals in handmade safety matches. Petitioner purchases handmade safety matches from M/s.Chidambaram Match Industry, Madurai. Exemption is granted for safety matches which are handmade as per Entry 24 of Schedule I of the KVAT Act. During the return period 2005-06, 2006-07 and 4/2007 to 11/2008, petitioner submitted returns claiming benefit of exemption. The assessments have been completed by Exts.P4, P6 and P8. This is followed by demand notice. Ext.P2 is the circular issued wherein referring to enquiry it is stated that there is no surviving handmade match making unit in Kerala. It is further stated that some manufacturers are, on the other hand, selling matches which are partially machine made, claiming tax exemption on the pretext that they are handmade WPC.32976/08 : 2 : safety matches. It is further stated that all officers are directed to examine consignments from this view point before allowing exemption claimed by the dealer. Ext.P3 is the certificate issued by the Commercial Tax Officer, Thirumangalam dated 8.4.2008. In Ext.P3, it is certified that Tvl.chidambaram match Industries 10C/6, Mohammed sha puram 1st street, Thirumangalam is a registered dealer in this office having VAT No.33285042046 and doing business in handmade safety matches only. 2. I heard learned counsel for petitioner and learned Government Pleader. Learned counsel for petitioner submits that appeals have been filed accompanied by stay applications against the assessment orders. As far as the challenge against Ext.P2 circular is concerned, the only ground raised is that it has created confusion. It may not be sufficient to challenge the circular citing that it has created confusion. I also note that the circular states that all officers are directed to examine consignments from the view point mentioned in the body of the circular before allowing exemption. It may not be possible for me to hold that the petitioner has established a case for interfering Ext.P2. I feel that WPC.32976/08 : 3 : the petitioner, having invoked the appellate remedy, need not be permitted to approach this court at this stage as applications for stay are also pending. Writ petition is disposed of directing the 3rd respondent to take up the applications for stay in the appeals filed against Exts.P4, P6 and P8 and take a decision thereon in accordance with law within one month from the date of receipt of a copy of this judgment. Till such time, recovery proceedings against the petitioner shall be kept in abeyance. It is open to the petitioner to rely on Ext.P3 before the appellate authority. The petitioner will produce a copy of this judgment before the 3rd respondent as soon as it is received. Sd/- (K.M.JOSEPH, JUDGE) aks // TRUE COPY // P.A. TO JUDGE