IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE V.K.MOHANAN TUESDAY, THE 15TH SEPTEMBER 2009 / 24TH BHADRA 1931 OT.Rev.No. 20 of 2009() ----------------------- TA(VAT).254/2008 of KERALA VAT APPELLATE TRIBUNAL, ERNAKULAM .................... REVISION PETITIONER/RESPONDENT/REVENUE: ----------------------------------------------------------- STATE OF KERALA, REPRESENTED BY JOINT COMMISSIONER (LAW), COMMERCIAL TAXES, ERNAKULAM. BY GOVERNMENT PLEADER SRI. MOHAMMED RAFIQ RESPONDENT(S): APPELLANT/ASSESSEE: ---------------------------------- M/S. CLASSIC MARBLES, PALLIKUNNU, KANNUR - 670 004. ADV. SRI.C.A.SADASIVAN SRI.S.ABU BAKER KUNJU SRI.JOY P.JOSE SRI.SOJAN MATHEW THIS OTHER TAX REVISION (VAT) HAVING BEEN FINALLY HEARD ON 15/09/2009, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: C .N. RAMACHANDRAN NAIR & V.K. MOHANAN, JJ. -------------------------------------------- O.T. Rev. No. 20 OF 2009 -------------------------------------------- Dated this the 15th day of September, 2009 O R D E R Ramachandran Nair, J. This Revision is filed by the State challenging the order of the Tribunal deleting the addition towards freight for transport of marble by the respondent from Rajasthan to Depot in Kerala. Government Pleader pointed out that the respondent has estimated entry tax on the goods brought from outside including freight thereon and according to him, additions made by the assessing officer and sustained in first appeal are the freight component on which entry tax was paid by the respondent at the checkpost. However, counsel appearing for the respondent contended that the respondent has not declared any freight at the checkpost but along with the value of goods, freight charges were estimated by the checkpost authorities and respondent was compelled to remit entry tax for release of goods. Therefore according to him there is no scope for addition of freight to purchase cost over and above the freight accounted by the respondent. 2 2. After hearing counsel on both sides and after going through the Tribunal's order, we are of the view that in principle the Tribunal's order is not tenable because they allowed the appeal filed by the respondent on the ground that this Court has declared collection of entry tax as unconstitutional. The Tribunal has failed to notice that the dispute is about acceptability of freight accounted by the respondent. Since the respondent admittedly paid entry tax on higher freight amount over the accounted freight charges, certainly it requires detailed consideration and the Tribunal thoroughly went wrong in relying on the judgment of this Court in the entry tax case wherein this Court was not concerned about the freight charges involved in transport of goods. We do not think there is any difficulty to estimate freight charges more or less at actual because it is common knowledge that source of marble is only Rajasthan and respondent has also accounted transport of goods from Rajasthan to the Depot in Kerala. Since Tribunal has not considered the justification for rejection of freight accounted and additions made in assessment and sustained in first appeal, we set aside the order of the Tribunal and remand the matter back to the Tribunal 3 for considering the justification for rejection of freight accounted and addition thereto. The Tribunal will take into account the volume or quantum of goods transported, freight accounted by the respondent and the corresponding freight on which entry tax is paid at the chackpost and examine whether there is substantial variance, and if so estimate the freight based on the distance travelled and the normal truck charges, details of which can be furnished by both sides. The Tribunal will give opportunity to both sides and decide the matter afresh within a period of three months from the date of production of a copy of this judgment. O.T. Rev. is disposed of as above. (C.N.RAMACHANDRAN NAIR) Judge. (V.K. MOHANAN) Judge. kk 4