IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM WEDNESDAY, THE 15TH DECEMBER 2010 / 24TH AGRAHAYANA 1932 WP(C).No. 37397 of 2010(Y) --------------------------------------- PETITIONER: ------------------- SHILPI CABLETRONICS (P) LTD., E-138, RIICO INDUSTRIAL AREA, BHIWADI, RAJASTAN-301 019, REPRESENTED BY P.A.HOLDER SASIKUMAR. BY ADVS. SRI.VIJAYAN. K.U, SRI.K.N.SREEKUMAR. RESPONDENTS: ------------------------ 1. COMMERCIAL TAX INSPECTOR, COMMERCIAL TAX CHECK POST, WALAYAR – 678 624. 2. COMMERCIAL TAX OFFICER (ENQUIRY), O/O THE DEPUTY COMMISSIONER, COMMERCIAL TAXES, PALAKKAD – 678 001. 3. MANAGER, PUNJAB NATIONAL BANK, S M E, PATPARGANJ INDUSTRIAL AREA, DELHI-110 092. 4. STATE OF KERALA, REPRESENTED BY SECRETARY TO GOVERNMENT, TAXES DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM – 695 001. R1, R2 & R4 BY GOVT. PLEADER SRI. V.K. SHAMSUDHEEN. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 15/12/2010,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: prv. C.K.ABDUL REHIM,J. ------------------------------- WP(C).NO. 37397 of 2010 --------------------------------- Dated this the 15th day of December, 2010 JUDGMENT Petitioner is challenging Ext.P6 through which penalty was imposed under section 47(6) of the KVAT Act. On 10.2.2010 a lorry bearing registration NO. TN 39 AM/2111 was intercepted at the check post at Walayar and proceedings under section 47 (2) was initiated alleging suspicion regarding evasion in payment of tax, for the reason that the documents which accompanied the transport revealed that consignee is at Thiruvallur, Tamil Nadu. However, the petitioner furnished Bank Guarantee for the value of security deposit demanded and the detention was released. Subsequently the 2nd respondent had finalised the enquiry proceedings through Ext.P6 imposing penalty to the tune of Rs.3,39,680/. Through Ext.P6 order the Bank Guarantee was directed to be adjusted against the amount of penalty imposed. 2. Grievance of the petitioner is that he has not received any notice issued by the 2nd respondent with respect to finalisation of the proceedings and that he was denied of any WP(C) .37397/2010 2 opportunity of personal hearing before passing Ext.P6 order. On a perusal of Ext.P6 it is revealed that notice of hearing sent to the petitioner in the address which was revealed from the Bank Guarantee was returned with postal endorsement as 'not known'. It is also stated in Ext.P6 that a notice of hearing was sent to the consignee, which was acknowledged by them. Since there was no appearance either on the side of the consignor or consignee, the 2nd respondent had imposed penalty. 3. Petitioner is a company having its registered office at Rajastan. According to the petitioner, in view of the fact that they have already furnished Bank Guarantee for a considerable amount, they would have definitely appeared if any notice of hearing was received. It is stated that the petitioner has got valid contentions to be submitted before the 2nd respondent, in order to prove that the transport was bonafide and there was no attempt in evasion of payment of tax. According to the petitioner, the denial of opportunity for personal hearing had caused severe prejudice to them. Under such circumstances the petitioner seeks indulgence of this court in quashing Ext.P6 and for directing fresh disposal after affording a personal hearing to WP(C) .37397/2010 3 the petitioner. 4. Considering the fact that, proper notice of hearing was sent through registered post, I am not impressed by the arguments raised. However, it is evident that the petitioner could not participate in the enquiry, under circumstances as narrated above. Hence I am of the view that interest of justice will be served if the petitioner is directed to appear before the 2nd respondent for a personal hearing and the 2nd respondent is directed to pass fresh orders on the basis of such hearing. 5. Therefore, the writ petition is allowed and Ext.P6 is hereby quashed. The petitioner is directed to appear before the 2nd respondent on 29.12.2010 at 11.a.m. for personal hearing. Needless to say that the petitioner shall be permitted to produce documents if any in support of their contentions. The 2nd respondent shall issue fresh orders on the basis of the personal hearing to be conducted on that day itself, or on any other day to which the matter will be adjourned. Orders in this regard shall be issued as early as possible, at any rate, within a period of one month from the date of receipt of a copy of this judgment. WP(C) .37397/2010 4 6. Respondents are directed to keep in abeyance all further steps for realisation of the Bank Guarantee, till fresh orders are issued by the 2nd respondent as directed above, if it is not already encashed. C.K.ABDUL REHIM,JUDGE pmn/ WP(C) .37397/2010 5