IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR FRIDAY, THE 21ST NOVEMBER 2008 / 30TH KARTHIKA 1930 WP(C).No. 1103 of 2006(F) ------------------------- PETITIONER(S): --------------- N.KRISHNAN, NAVABHARATH CASHEW TRADERS, POLAYATHODE, KOLLAM. BY ADV. SRI.S.SANTHOSH KUMAR RESPONDENT(S): --------------- 1. THE COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM. 2. THE SALES TAX OFFICER, III CIRCLE, KOLLAM. BY G.P. SRI.TEKCHAND THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 21/11/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX PETITIONER'S EXHIBITS: P1: TRUE COPY OF NOTICE DT.22.6.2000. P2: TRUE COPY OF RECEIPT DT.22.6.2000. P3: TRUE COPY OF ORDER DT.26.8.2002. P4: TRUE COPY OF LETTER DT.5.10.2002 TO R2. P5: TRUE COPY OF PETITION DT.9.3.2004 TO R2. P6: .DO. DT.15.12.2005 TO R2. P7: .DO. TO R1. P8: TRUE COPY OF LETTER DT.24.12.2005 OF R2. TRUE COPY PA TO JUDGE C.N.RAMACHANDRAN NAIR, J. .................................................................... W.P.(C) No.1103 of 2006 .................................................................... Dated this the 21st day of November, 2008. JUDGMENT The W.P. is filed for direction to the second respondent to grant refund of security released in adjudication proceedings. Security was furnished for release of goods and in adjudication, part of the security amount was released. According to the petitioner, inspite of repeated demand, security was not released. However, Ext.P8 shows that security was adjusted against demand for 2001-2002 sometime in 2005. Petitioner's case is that interest is not credited to the security amount. Counsel has relied on decision of this court in M/S.SHYAM ELECTRICALS V. STATE OF KERALA (1994 K.L.J. (TAX CASES) 233) whereunder this court ordered payment of interest at the rate of 15% p.a. for inordinate delay in refund of security. Even though I feel this court has no authority to fix interest payable on refunds in excess of statutory limit, I feel in this case on equitable consideration the petitioner is entitled to interest at the rate of 15% p.a. because rate of default interest charged on outstanding liability is 1% per month for first three months and 2% per month thereafter. It is not known whether interest under Section 23(3) is charged on default amount at 2 the time of adjustment. If interest is charged for outstanding liability, then there will be direction to the respondents to credit interest on the refund amount at the rate of 15% p.a. for period after expiry of three months from date of order of refund and grant eligible refund, if any, due to the petitioner within two months from date of production of copy of this judgment. If there is any outstanding liability still due from the petitioner, the refund amount due will be adjusted against such dues. W.P.(C) is disposed of as above. C.N.RAMACHANDRAN NAIR Judge pms