IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 12TH OCTOBER 2010 / 20TH ASWINA 1932 WP(C).No. 27870 of 2010 (G) -------------------------- PETITIONER: --------------- C.S.MANIKANDAN, CHIX LAND, PALATHULLY ROAD, THATHAMANGALAM, PALAKKAD. BY ADVS. SRI.K.M.JAMALUDHEEN SMT.LATHA PRABHAKARAN SRI.M.UNNIKRISHNA MENON RESPONDENT: -------------------- THE INTELLIGENCE OFFICER, (IB), DEPARTMENT OF COMMERCIAL TAX, MATTANCHERRY, AT MINI CIVIL STATION, ALUVA- 683101. BY SENIOR GOVERNMENT PLEADE, C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12/10/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: VK C.K.ABDUL REHIM, J --------------------------- W.P(C) No.27870 of 2010-G ---------------------------- Dated this the 12th day of October, 2010. J U D G M E N T Grievance of the petitioner is that the respondent is taking hasty steps to finalise the proceedings for imposing penalty upon the petitioner without affording him a reasonable opportunity to object the proposal and also without affording copies of relevant incriminating documents, and further without affording opportunity to cross examine the persons concerned. 2. Ext.P1 is a proposal notice issued under Section 67(1) of the KVAT Act for imposing penalty to the tune of Rs.11,44,588/-, being twice the amount of tax alleged to have been evaded by the petitioner. The proceedings was initiated on the basis of an inspection conducted at the office of the tax consultant and recovery of one executive diary from the consultant which contained the transaction undertaken by the petitioner, which are allegedly unaccountant. On receipt of Ext.P1 notice the petitioner made a request before the respondent for furnishing copies of documents relied on by the respondent and also for giving an opportunity to W.P(C) No.27870 of 2010-G 2 cross examine the tax consultant. Ext.P2 is a written request submitted in this regard. Through Ext.P3 reply the respondent permitted the petitioner to verify the executive diary and other connected documents, on 12.8.2010. The petitioner again submitted Ext.P4 letter stating that mere verification of the documents and taking of abstracts therefrom will not help the petitioner to contest the case in an effective manner and therefore requesting to furnish photocopies of the relevant documents. Since the respondent has not complied with such requests, apprehending finalisation of the penalty proceedings, this writ petition is filed. 3. In a statement filed on behalf of the respondent it is mentioned that considering the request made by the petitioner permission to cross examine the tax consultant was afforded on 16.9.2010 and notice was issued in this regard. It is further mentioned that a statement regarding details of transaction unearthed from the executive diary was furnished to the petitioner 6.9.2010 through registered post. But it is mentioned that no statement was recorded from the tax consultant. 4. In the reply affidavit filed by the petitioner, it is mentioned that the notice intimating opportunity regarding cross W.P(C) No.27870 of 2010-G 3 examine was received by the petitioner only at belated stage. It is further stated that the petitioner was not furnished with copy of any statement recorded from the tax consultant, on the basis of which alone cross examine can be conducted. However, receipt of Ext.P5 statement which contained details of the transactions revealed from the executive diary, is admitted. 5. Considering the rival submissions, I am of the opinion that it is necessary in the interest of justice to afford the petitioner with reasonable opportunity to cross examine the Sales Tax Consultant. If no statement has been recorded from the consultant, the respondent could not be insisted for furnishing copy of the same to the petitioner. It is left to the petitioner to decide whether the consultant need be cross examined in the absence of any statement recorded from him. From Ext.P5 it is evident that a statement containing details of the transaction has already been furnished, the petitioner or his agent shall be afforded with reasonable opportunity to make verification of the executive diary and to permit them to take note of the entries contained therein for the purpose of filing objections and also for the purpose of conducting cross examine. W.P(C) No.27870 of 2010-G 4 6. Under the above circumstances, the writ petition is disposed of directing the respondent to afford an opportunity as stated above to the petitioner, to file effective objections against the proposal and to contest the proposal for imposition of penalty in a reasonable manner. At the same time, it is made clear that the petitioner shall co-operate with the respondent for finalisation of the proceedings and if any attempt for protracting the matter is practiced, then the respondent will be at liberty to finalise the proceedings without any further delay. The writ petition is disposed of with the above observations. C.K.ABDUL REHIM JUDGE ab W.P(C) No.27870 of 2010-G 5