IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 5TH NOVEMBER 2009 / 14TH KARTHIKA 1931 WP(C).No. 31431 of 2009(Y) -------------------------- PETITIONER(S): --------------- ANOOP.G, M/S. VICTORY ENTERPRISES, CHAVAKKAD. BY ADV. SRI.P.RAGHUNATHAN SRI.PREMJIT NAGENDRAN RESPONDENT(S): --------------- 1. COMMERCIAL TAX OFFICER, CHAVAKKAD. 2. DEPUTY COMMISSIONER (APPEALS), ERNAKULAM. 3. INSPECTING ASSISTANT COMMISSIONER, COMMERCIAL TAXES, THRISSUR. GOVERNMENT PLEADER SRI.C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 05/11/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.K.ABDUL REHIM, J. ------------------------------ W.P.(C).No.31431 OF 2009 ------------------------------ Dated this the 5th day of November, 2009 J U D G M E N T ---------------------- 1. Challenge in this writ petition is against Ext.P14 order of the 2nd respondent by which the interim stay petitions filed along with statutory appeals were dismissed. With respect to Ext.P1 to P3 assessments pertaining to the year 2007-08 and for the months of April to October 2008, and November 2008 the petitioner had filed Ext.P4, P6 and P8 appeals before the 2nd respondent. Ext.P5, P7 and P9 are the stay petitions filed along with the appeals. The 2nd respondent had issued interim order granting stay, imposing condition for payment of 50% of the tax amount in dispute. The petitioner challenged the said order in a writ petition before this court. Through Ext.P13 Judgment this court set aside the order and directed the 2nd respondent to reconsider the matter in the light of decision rendered by the Sales Tax Appellate Tribunal in relation to assessment of the manufacturer for the previous periods, and also in the light of the judgment of this court in OTA.9/07. Ext.P14 is the consequential order passed in compliance with the above judgment. W.P.(C).31431/09-Y 2 2. In Ext.P14 the interim stay applications were dismissed finding that, a Division Bench of this court in the judgment in OTA.9/07 dt.6.4.09 had declared that the commodity dealt with by the petitioner, “Ujala Supreme” and “Ujala Stiff and Shine” are classified under the residuary entry of 103 of SRO 82/2006 taxable @ 12.5% on upholding the clarification issued by the Commissioner of Commercial Taxes. Therefore it is found that the appeals deserve no merit. 3. The main dispute with respect to the assessments relates to the rate of tax applicable to the commodities dealt with by the petitioner. According to the petitioner the product will fall under Entry 155(8) (d) and Entry 118 of List A of the 3rd schedule of the KVAT Act and the rate of tax is 4%. But according to the respondents the product will fall only under residuary entry of 103 of SRO. 82/2006 and therefore taxable at 12.5%. The appellate Tribunal as per order in T.A.No:272 and 314 of 2008, dt.23.12.2008 held that the products are taxable only at 4%. A tax revision case filed by the State against the said decision is pending disposal before this court. At the same time the Commissioner of Commercial Taxes had issued clarification under Section 94 of the KVAT Act to the effect that the product is taxable only at 12.5%. Challenge against the clarification issued by the Commissioner was negatived by the Division Bench of this W.P.(C).31431/09-Y 3 court in the judgment in OTA.9/07. But that Judgment is now pending in challenge before the Hon'ble Supreme Court in an SLP filed by the petitioner. 4. It is submitted by the petitioner that there is no stay granted by the Hon'ble Supreme Court in the SLP pending as well as there is no stay order issued by this court in the tax revision case filed against the order of Tribunal. Therefore according to the petitioner the order issued by the appellate Tribunal is holding the field at present. On the other hand learned Government Pleader contended that since the clarification issued under Section 94 has already been upheld by a Division Bench of this court, the dictum laid down therein is governing the field. 5. On an active consideration of the rival contentions, I am convinced that the dispute with respect to rate of tax still remains unsettled, pending consideration in various litigations. Eventhough a Division Bench of this court upheld the view adopted in the clarification order, the same is pending consideration in SLP before the Hon'ble Supreme Court. At the same time the decision of the appellate Tribunal taking a contrary view is also under challenge in the tax revision case. However, without arriving at any finding regarding the dispute relating to the rate of tax, I am of the opinion that the appeal W.P.(C).31431/09-Y 4 pending before the 2nd respondent can be directed to be disposed of, keeping in abeyance realisation of the tax amount due on insisting conditions for part payment. 6. Under the above circumstances Ext.P14 order is hereby quashed. The writ petition is disposed of directing the 2nd respondent to consider and pass orders on Ext.P4, P6 and P8 appeals as early as possible, after affording an opportunity of hearing to the petitioner. The respondents are restrained from proceeding with recovery of the amounts covered under Ext.P1 to P3, till the disposal of the appeals, on condition of the petitioner remitting 1/3rd of the amount of tax in dispute within six weeks from today and on furnishing security for the balance amount. C.K.ABDUL REHIM, JUDGE. okb