IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR TUESDAY, THE 19TH FEBRUARY 2008 / 30TH MAGHA 1929 WP(C).No. 16248 of 2007(H) -------------------------------------- PETITIONER: ------------------ K.PANDURANGA PAI, KRISHNA NIVAS, KANHANGAD, KASARAGOD DISTRICT. BY ADV. SRI.V.P.SUKUMAR SRI.KURYAN THOMAS RESPONDENTS: ----------------------- 1. THE INTELLIGENCE INSPECTOR, SQUAD NO.II, AGRICULTURAL INCOME TAX & SALES TAX, KASARAGOD. 2. THE INTELLIGENCE OFFICER, SQUAD NO.II, KASARAGOD. 3. THE COMMERCIAL TAX OFFICER, HOSDURG. 4. THE SPECIAL DEPUTY TAHSILDAR (RR), HOSDURG. BY GOVERNMENT PLEADER SRI.K.R.PRADEEP THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 19/02/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) NO.16248/2007 APPENDIX PETITIONERS EXHIBITS EXT.P1:- COPY OF THE ORDER DT. 5.8.97 PASSED BY THE 2ND RESPONDENT. EXT.P2:- COPY OF THE ORDER DT. 20.10.97 PASSED BY THE HONOURABLE COURT IN CMP. NO.31687/97 IN OP. NO.17747/97. EXT.P3:- COPY OF THE ORDER DT. 31.10.97 IN CMP. NO.34160/97 IN OP. 17747/97. EXT.P4:- COPY OF THE ORDER DT. 5.11.97 PASSED BY THE 2ND RESPONDENT. EXT.P5:- COPY OF THE ORDER DT. 31.1.98 PASSED BY THE DEPUTY COMMISSIONER, COMMERCIAL TAXES, KANNUR IN RP. NO.70/97. EXT.P6:- COPY OF THE ORDER DT. 15.9.99 PASSED BY THE COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM. EXT.P7:- COPY OF THE JUDGMENT DT. 5.11.05 PASSED BY THIS HONOURABLE COURT IN OP. NO.32039/99. EXT.P8:- COPY OF THE RR NOTICE DT. 16.5.07 ISSUED TO THE PETITIONER BY THE 4TH RESPONDENT. /TRUE COPY/ P.A. TO JUDGE tss C.N.RAMACHANDRAN NAIR, J. ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ W.P.(C) No. 16248 of 2007-H ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ Dated this the 19th day of February, 2008 J U D G M E N T The petitioner is challenging Ext.P8 recovery proceedings for recovery of an amount of Rs.8,71,136/- which is the value and interest thereon for the goods (rubber) seized by the department under Section 28(8A) of the K.G.S.T Act and released to the petitioner on furnishing security under Ext.P4 order. The proceedings ended up in confiscation of goods and sale of the same under Section 28(8A) of the K.G.S.T Act. That order was issued on 05/08/1997 and the same got confirmed before statutory authorities and ultimately vide Ext.P7 judgment of this Court on 05/11/2005. Since confiscation order was upheld, the petitioner was called up to remit the value of the seized goods released to him based on the bond executed by him which he did not remit for long, which led to accrual of massive amount of interest under Section 23(3) of the K.G.S.T Act. When this writ petition was admitted, this Court felt that the petitioner was bound to pay the amount demanded and, if at all relief is to be considered, it is only a matter of reduction in interest that too if payment is made in time. Counsel submitted that W.P.(C) No. 16248 of 2007-H -: 2 :- pursuant to the interim order of this Court dated 29/05/2007, the petitioner remitted Rs.4,00,000/-. Out of the payment of Rs.4,00,000/-, Rs.2,95,020/- account for value of the goods recovered from the petitioner. The balance of above Rs.5,00,000/- is interest payable at the rate of 24% per annum in terms of Section 23(3) of the K.G.S.T Act. However, the interest stands reduced to 12% with effect from 01/04/2005. 2. Considering the nature of the demand which is neither tax nor penalty but value of goods, I feel that the petitioner can be granted reduction of interest, more so because the Government had even in 2004 granted amnesty benefit granting reduction upto 50% of interest for payment of arrears of tax. In the circumstances, I reduce interest by 50%, provided, the petitioner clears the balance of 50% of interest within one month from today. Payment made pursuant to the interim order should be adjusted towards demand and there will be a direction to the third respondent to re-work interest liability by reducing it to 50% and give a statement to the petitioner on production of a copy of the judgment to make payment within the time granted. However, if the petitioner does not make W.P.(C) No. 16248 of 2007-H -: 3 :- payment of 50% interest as per the judgment, then the waiver of 50% granted will stand vacated on expiry of one month and the respondents will be at liberty to recover the full amount. Writ petition is disposed of as above. C.N.RAMACHANDRAN NAIR, Judge ms