IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON WEDNESDAY, THE 12TH AUGUST 2009 / 21ST SRAVANA 1931 WP(C).No. 34438 of 2005(Y) --------------------------------------- PETITIONER(S): ------------------------ K.M.PAREETH, PROPRIETOR, UNION SAW MILLS, NADAKKAL P.O., ERATTUPETTA. BY ADVS.MR.ARIKKAT VIJAYAN MENON MR.HARISANKAR V. MENON SMT.MEERA V.MENON RESPONDENT(S): -------------------------- 1. INTELLIGENCE OFFICER (IB), COMMERCIAL TAXES, KOTTAYAM. 2. DEPUTY COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM. 3. COMMISSIONER OF COMMERCIAL TAXES, THIRUVANANTHAPURAM. 4. TAHSILDAR (RR), MEENACHIL TALUK, KOTTAYAM DISTRICT. R1 TO R4 BY GOVERNMENT PLEADER MR. V.K.SHAMSUDEEN THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 12/08/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C) NO.34438/2005 APPENDIX PETITIONER'S EXHIBITS P1:- COPY OF THE ORDER PASSED BY THE IST RESPONDENT DT. 27.9.02. P2:- COPY OF THE ORDER SISEUD BY THE 2ND RESPONDENT DTD. 31.1.05. P3:- COPY OF THE REVISION PETITION FILED BEFORE THE 3RD RESPONDENT DTD. 18.3.05. P4:- COPY OF THE ARGUMENTS NOTE SUBMTITED BY THE PETITIONER. DTD. 13.6.0.5. P5:- COPY OF THE ORDER ISSUED BY THE 3RD RESPONDENT DT. 10.10.05. P6:- COPY OF THE ORDER PASSED BY THE IST RESPONDENT DTD. 14.12.01. P7:- COPY OF THE ASSESSMENT ORDER PASSED BY AIT & SALES TAX OFFICER FOR THE YEAR 2000-01. DTD. 17.1.04. TRUE COPY P.A. TO JUDGE tss P.R. RAMACHANDRA MENON, J. ........................................................................ W.P.(C) No. 34438 OF 2005 ......................................................................... Dated this the 12th August, 2009 J U D G M E N T Imposition of penalty under Section 45A of the KGST Act in respect of the assessment year 2001-02, fixing a liability to an extent of Rs. 4,45,55,614/- is the subject matter of dispute in this Writ Petition. 2. The petitioner is a registered dealer in Timber, bringing the goods either from abroad or from other States and also resorting to local purchase. Pursuant to the inspection conducted by the Squad, several incriminating circumstances were brought to light, leading to imposition of penalty as borne by Ext. P1. Challenging Ext. P1, the petitioner filed the 'first Revision' before the second respondent, which was dismissed as per Ext.P2 and this was subjected to challenge by filing the 'second Revision' before the third respondent as per Ext. P3. The petitioner also submitted Ext.P4 'argument notes'. After considering all the facts and figures, the third respondent passed W.P.(C) No. 34438 OF 2005 2 Ext.P5 order dismissing the Second Revision which is subjected to challenge in the present Writ Petition. 3. The main case put forth by the petitioner is of three folds. Firstly, the petitioner, denies the insinuation in toto; Secondly, the petitioner contends that there are factual mistakes in Ext.P1 and thirdly, the value of the timber, reckoned by the respondents for imposing the penalty, is stated as not correct. 4. The respondents have filed counter affidavit pointing out the sequence of events and the reasons for sustaining the impugned orders. Taking note of the contents in the said counter affidavit, which, however have not been chosen to be rebutted by the petitioner by filing any reply, particularly with regard to points 1 and 3, they do not deserve to be considered by this Court and the point of challenge is rather confined to the 'second point' as to the factual mistake stated as crept in Ext.P1. 5. The learned Counsel for the petitioner submits that the only dispute is with regard to the tax liability in respect of the assessment year 2001-02. The value of the Teak in respect of W.P.(C) No. 34438 OF 2005 3 the alleged suppressed quantity at the rate of Rs. 45000/- works out to be Rs.1,11,93,120/-, whereas the value of the 'other timber' at the rate of Rs.17,000/- per M3 comes to Rs.8,68,24,661/-, thus attributing to a total of Rs.9,80,17,781/- , which in turn has been taken as the opening stock (as given at Ext. P1). The learned Counsel for the petitioner, referring to the quantity of timber and the value as disclosed from Ext.P6 order passed by the Intelligence Officer, IB, Trivandrum in respect of the very same assessment year 2000-01, submits that the total figure shown at internal page 7 of Ext. P6 ( with regard to the alleged suppression of turnover), is to an extent of Rs.2,16,77,005/- and that the very same figure has been adopted by the assessing officer while passing Ext.P7 assessment order, showing the actual extent of the alleged suppression. This being the position , there could not have been any suppression over and above this extent and as such, the figures shown in Ext.P1 to the contrary (i.e. Rs.11,67,69,828/- instead of Rs.9,80,17,781/- ) are quite wrong and unfounded. This specific aspect as to the glaring W.P.(C) No. 34438 OF 2005 4 irregularity in the actual figures was not analysed or considered by the concerned authorities while passing the impugned orders, particularly Ext. P5, submits the learned Counsel. 6. The learned Government Pleader ,with reference to the contents of the counter affidavit, submits that the averments and allegations raised by the petitioner, as to the alleged mistake in the figures is not correct or sustainable. It is also pointed out that absolutely no challenge was raised against the 'quantum' arrived at by the concerned officers in the proceedings filed, including Ext.P3 appeal filed before the 3rd respondent and also anywhere in Ext.P4 'Notes of Argument'. The learned Counsel for the petitioner retorts that, as per the contents of paragraph Nos. 3 and 4 of Ext. P4 'argument notes', the issue was brought to the notice of the third respondent, though not in specific terms. 7. The learned Government Pleader submits that there is also an 'admission' from the part of the petitioner, as recorded in Ext.P5 order passed by the third respondent, stating that the actual suppressed turnover was only of Rs.10 crores and not W.P.(C) No. 34438 OF 2005 5 14.01 crores, as worked out by the intelligence Officer . The said admission is referred to at two places, in the second page of Ext. P5. It is very much relevant to note that the petitioner has not chosen to deny the contents of Ext.P5 with regard to the 'admission' stated as made from his part anywhere in the Writ Petition, nor has he chosen to add that the observation made by the third respondent while passing the order in this regard, as to the 'admission' of alleged suppression of '10 crores' is quite wrong or perverse. In the absence of any specific denial as to the admission stated as made, it remains to be an undisputed fact, which does not require to be proved any further. 8. The learned Government Pleader submits that the reference made in Ext.P1 order by the assessing officer is only with regard to the figures and contents of Ext. P6 regarding compounding of the offence and that the actual figure has been worked out, also taking note of the entries in the Books of Accounts and other records. That apart, it is also pointed out that, the assessment proceedings are liable to be re-opened, in W.P.(C) No. 34438 OF 2005 6 view of the power conferred under Section 19 of the KGST Act . In any view of the matter, the fact remains that the petitioner had made an 'admission' before the 3rd respondent while passing Ext. P5 order, that the suppressed turnover was only to an extent of '10 crores'. This being the position , the case put forth by the petitioner referring to the discrepancies in the facts and figures to an extent of more than Rs. 7 Crores, does not appear to be of any significance. The Writ Petition fails and it is dismissed accordingly. P.R. RAMACHANDRA MENON, JUDGE. lk