IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMAN TUESDAY, THE 18TH MARCH 2008 / 28TH PHALGUNA 1929 OP.No. 33698 of 2002(J) ----------------------- PETITIONER: ------------ P.S. BADER, EX-SUNIL SAW MILLS, KOTTARAKKARA, KOLLAM DISTRICT. BY ADV. SRI.B.MOHANLAL RESPONDENTS: ------------- 1. THE COMMISSIONER OF COMMERCIAL TAXES, KERALA STATE, THIRUVANANTHAPURAM. 2. THE DEPUTY COMMISSIONER OF COMMERCIAL TAXES, KOLLAM. 3. THE INTELLIGENCE OFFICER, COMMERCIAL TAXES SQUAD NO.II, KOLLAM. 4. THE SALES TAX OFFICER, KOTTARAKARA, KOLLAM DISTRICT. BY GOVERNMENT PLEADER SRI T.C.R. CHAND THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 18/03/2008,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: OP.NO.33698/02 ORDER ON CMP.NO.56899/02 IN OP.NO.33698/02 ----------- Dismissed 18/3/2008 Sd/- P.R.RAMAN, JUDGE. APPENDIX PETITIONER'S EXTS: EXT.P1 TRUE COPY OF THE SHOP INSPECTION REPORT DTD. 17/6/94. EXT.P2 TRUE COPY OF THE NOTICE NO.CR-36/94-95 DTD. 25/5/95 ISSUED BY THE 3RD RESPONDENT TO THE PETITIONER. EXT.P3 TRUE COPY OF THE OBJECTION FILED BY THE PETITIONER AGAINST EXT.P2 NOTICE DTD. 4/8/95. EXT.P4 TRUE COPY OF THE ORDER OF THE 3RD RESPONDENT NO.CR-36/ 94-95 DTD. 17/10/95. EXT.P5 Series TRUE COPY OF THE AFFIDAVIT FILED BY THE DEPONENTS BEFORE THE 2ND RESPONDENT. EXT.P6 TRUE COPY OF THE ORDER OF THE 2ND RESPONDENT IN R.P.NO.128/925 DTD. 13/5/97. EXT.P7 TRUE COPY OF THE ORDER OF THE IST RESPONDENT IN S.T.R.P.NO.991/97 (R1-32669/97/CT/3/2/2000). EXT.P8 TRUE COY OF THE NOTICE NO.12171850/94-95 (REMANDED) DTD. 20/9/2002 ISSUED BY THE 4TH RESPONDENT TO THEir PETITIONER. P.R.RAMAN, J. --------------------------- O.P.No.33698 OF 2002 ---------------------------- Dated this the 18th day of March, 2008 JUDGMENT Petitioner is running a Saw Mill under the name and style "Sunil Saw Mills" at Kottarakara and according to him, was doing sawing of timber on coolie basis for which proper accounts were maintaining. The 3rd respondent-Intelligence Officer made an inspection of the business premises of the petitioner on 17/6/1994 and the shop inspection report is produced as Ext.P1. He noticed that all the goods lying there, are not entered either in the stock register or in the books maintained by the assessee. Ext.P1 shows the complete physical stock of certain items. It also shows that no daily stock register or closing stock inventory as on 31/3/94 is kept. Notice was issued proposing to impose penalty under Section 45A of the K.G.S.T. Act for non-maintenance of true and complete accounts. Ext.P2 is the said notice. Petitioner submitted his reply Ext.P3 wherein he stated that the goods taken note of in the inspection report belonged to various other third parties; but entrusted the same for coolie sawing. He has also produced affidavits of those persons to support his case. The Intelligence Officer however did not accept the contention of the petitioner and confirmed the -2- O.P.No.33698/2002 proposal and imposed penalty, against which he preferred a revision before the Deputy Commissioner, who also agreed with the finding of the Intelligence Officer. Thereafter, he preferred second revision before the Commissioner. That also ended without any success. Hence, this writ petition under Article 226 of the Constitution of India. 2. Learned Counsel Sri Mohan Lal appearing for the petitioner would contend that petitioner's establishment is a small Saw Mill. In that mill he was doing coolie sawing and what was noticed at the time of inspection was the goods entrusted by third parties, who have been entered in the register maintained for that purpose. He has given the details in Ext.P3. He also produced the affidavits of those persons in support thereof. Therefore, in case the authorities thought that the affidavits cannot be believed, necessarily, they should have been called and cross-examined as otherwise there is no reason why the sworn in statement by the third parties ought not have been accepted by the authorities. Therefore, according to him, the matter requires re- consideration by the authorities concerned. He also expressed his apprehension that once this penalty has become final, then Ext.P8 notice under Section 17(3) of the Act will be finalised. 3. The learned Government pleader appearing for the State, on the -3- O.P.No.33698/2002 other hand, would submit that there is no dispute that the petitioner is doing business in coolie sawing. What has been entrusted to the petitioner as born out by the records was not the goods noticed at the time of inspection. As a matter of fact, the Officer concerned has verified all the registers maintained and that is not covered by the register for not included in the shop inspection report. What are specifically noted in the shop inspection report are those not covered by any register. Therefore, the burden is on the petitioner to show that the goods that has been found at the time of shop inspection were in the stock register or those goods are actually entrusted by third parties and necessary entries have been made in the register. The fact that the logs were entrusted to the petitioner in February and June, 1993 and the sawing was done only in July and August, 1994 i.e. for over one year the logs were lying in his premises, that too for coolie sawing, is an unbelievable story. A person, who brings the logs for sawing, necessarily will take it immediately or at least within a week's time. He would not have allowed these goods to be remained with the petitioner for over a period of one year. Hence, the explanation offered by the petitioner do not instill confidence in the mind of this Court. Further, the fact finding authority and the revisional authorities have gone into these matters and having considered and entered a finding -4- O.P.No.33698/2002 on facts, this Court will not re-appreciate the facts except when the finding is found to be perverse. The penalty imposed is also reasonable. Taking into consideration all the above circumstances, I am not inclined to interfere with the orders impugned. However, I add to say that the penalty proceedings and the assessment proceedings are different proceedings and therefore, proceedings pursuant to Ext.P8 will be considered and decision taken independently dehors the penalty proceedings and without being influenced by this judgment. Subject to the above Original Petition is dismissed. P.R.RAMAN, JUDGE. kcv.