IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM MONDAY, THE 6TH JUNE 2011 / 16TH JYAISHTA 1933 WP(C).No. 15112 of 2011(L) -------------------------------------- PETITIONER: ------------------- M/S.LAKSHMI, HOTEL & RESORTS, KUMARAKOM, KOTTAYAM, REPRESENTED BY PARTNER, V.B.ANANDAN. BY ADV. SMT.T.RADHAMANY. RESPONDENTS: ------------------------ 1. INTELLIGENCE OFFICER, SQUAD I, OFFICE OF THE INSPECTING ASSISTANT COMMISSIONER (INTELLIGENCE), COMMERCIAL TAXES, KOTTAYAM. 2. DEPUTY COMMISSIONER (APPEALS), COMMERCIAL TAXES, ERNAKULAM. 3. INSPECTING ASSISTANT COMMISSIONER, COMMERCIAL TAXES, KOTTAYAM. R1 TO R3 BY GOVT. PLEADER MR. K.P. PRADEEP. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06/06/2011,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: prv. C.K.ABDUL REHIM,J. ------------------------------- WP(C).NO. 15112 of 2011 --------------------------------- Dated this the 6th day of June, 2011 JUDGMENT Challenge in this writ petition is against Ext.P8 interim order passed by the 2nd respondent appellate authority. Ext. P3 order imposing penalty issued against the petitioner under section 67(1) of the Kerala Value Added Tax Act 2003 (KVAT Act) was challenged before the 2nd respondent in a statutory appeal (Ext.P4). Ext.P5 is the stay petition filed along with the appeal. Through Ext.P8, interim stay was granted subject to condition of payment of 1/3rd of the amount due and on furnishing adequate security for the balance. 2. According to the petitioner, insistence for payment of 1/3rd of the amount was imposed in a mechanical manner without proper application of mind and without proper advertence to the contentions raised. It is further contended that the amount of penalty imposed is on the basis of an arbitrary assessment and there is every chance of getting considerable relief from the appellate authority. Therefore, if pending disposal of the appeal the petitioner is compelled to make payment of 1/3rd of the penalty amount, that will cause severe prejudice, is the contention. 3. On a perusal of Ext.P8 impugned order it is revealed WP(C).15112/2011 2 that the appellate authority had considered all the grounds raised in the appeal as well as those contended before the said authority while hearing the stay petition. After examination of the merits of such contentions, the appellate authority had arrived at a conclusion that, a prima facie case has been established for granting conditional stay. However, with respect to the quantum of penalty imposed, it is observed by the appellate authority that, the appellant had a strong case in respect of the suppression of turn over computed . It was further observed that a detailed verification of the connected records is required to examine sustainability or otherwise of the contentions raised. 4. While considering the sustainability of Ext.P8, I am in total disagreement with the contention of the petitioner that the order in question was issued in a mechanical manner. Proper advertence to the grounds raised as well as proper application of mind is explicit on the face of Ext.P8 order. However, the appellate authority had failed to mention any specific reason for imposition of the condition for payment of the extent of 1/3rd of the amounts due. Having considered the observations made to the effect that there is a strong case established with respect to the extent of the suppression of turn over and also in view of the observation that detailed verification of WP(C).15112/2011 3 connected records is required, I am of the view that imposition of a less onerous condition would have served ends of justice. 5. Under the above mentioned circumstances, the writ petition is disposed of directing the 2nd respondent to consider and dispose of Ext.P4 appeal on an early basis after affording an opportunity of hearing to the petitioner, as early as possible, at any rate within a period of two months from the date of receipt of a copy of this judgment. 6. Till the disposal of the appeal as directed above, in modification of the condition imposed in Ext.P8, the respondents are directed to keep in abeyance all further recovery steps, provided the petitioner remits a sum of Rs.1,50,000/- and furnishes security bond for the balance amount within two weeks from the date of receipt of a copy of this judgment. C.K.ABDUL REHIM,JUDGE pmn/ WP(C).15112/2011 4