IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE V.K.MOHANAN FRIDAY, THE 4TH DECEMBER 2009 / 13TH AGRAHAYANA 1931 ST.Rev..No. 267 of 2009() ------------------------- TA.261/2008 of STAT ADDL.BENCH, KOTTAYAM .................... REVISION PETITIONER/APPELLANT/ASSESSEE: ----------------------------------------------------------- K.DIVAKARAN NAIR, HOTEL SANDHYA, PERUNNA, CHANGANACHERRY. BY ADV. SRI.SOJAN JAMES RESPONDENT(S): --------------- STATE OF KERALA, REPRESENTED BY JOINT COMMISSIONER (LAW) COMMERCIAL TAXES, ERNAKULAM. BY G.P. SRI.MOHAMMED RAFIQ THIS SALES TAX REVISION HAVING COME UP FOR ADMISSION ON 04/12/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.N.RAMACHANDRAN NAIR & V.K.MOHANAN, JJ. .................................................................... S.T. Rev. No.267 of 2009 .................................................................... Dated this the 4th day of December, 2009. JUDGMENT Ramachandran Nair, J. We have heard Adv. Sri.Sojan James appearing for the petitioner and Government Pleader appearing for the respondents. 2. Challenge is against penalty sustained by the Tribunal for belated payment of turnover tax by the petitioner. It is seen that penalty originally levied under Section 45A of the KGST Act was at double the amount of tax. The assessment involved is for three months, April, May and June 2007. Counsel rightly pointed out that when there is specific provision under Section 45AA of the Act to levy penalty for belated payment of tax, there was no justification for invoking Section 45A. Besides this, he has brought to our notice the findings of the lower authorities that omission is only in regard to delay in payment of tax and the demand is based on return filed and the petitioner in fact with delay paid the entire arrears of tax with interest payable under Section 23(3A) of the KGST Act. Government Pleader 2 on the other hand submitted that payment is not voluntarily and the amount is recovered in the course of revenue recovery proceedings. In any case since the entire tax demand is based on returns filed, there was no attempt of evasion of tax. Since it is only a case of belated payment of tax which also should not be encouraged, we feel the case calls for reduction of penalty, particularly when full tax is paid with interest under Section 23(3A). The Tribunal has also found that assessee is not involved in subsequent defaults. In the circumstances, we modify the Tribunal's order by reducing the penalty to Rs.50,000/- (Rupees fifty thousand) as against Rs.75,000/- fixed by the Tribunal. Revision case is allowed in part as above. C.N.RAMACHANDRAN NAIR Judge V.K.MOHANAN Judge pms