IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 21ST MAY 2009 / 31ST VAISAKHA 1931 ST.Rev..No. 94 of 2009() ------------------------ TA.266/2007 of S.T.A.TRIBUNAL,ADDL.BENCH,PALAKKAD .................... REVISION PETITIONER ------------------------------ JOHN VARGHESE, NO.7, KUNNUMPURAM BUILDING, AMBUJAVILASAM ROAD, THIRUVANANTHAPURAM-695001. BY ADV. SRI.V.P.SUKUMAR SRI.KURYAN THOMAS RESPONDENT(S): --------------- STATE OF KERALA REP. BY THE CHIEF SECRETARY, SECRETARIAT, THIRUVANANTHAPURAM. BY G.P. SRI. MOHAMMED RAFIQ THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 21/05/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C .N. RAMACHANDRAN NAIR & C.K. ABDUL REHIM, JJ. -------------------------------------------- S.T. Rev. No. 94 OF 2009 -------------------------------------------- Dated this the 21st day of May, 2009 JUDGMENT Ramachandran Nair,J. Heard counsel for the petitioner and Government Pleader appearing for the respondents. Revision Petition is filed against the order of the Tribunal confirming penalty levied under Section 29A(4) of the K.G.S.T. Act for attempted evasion of tax in respect of three consignments of red chillies purchased by the petitioner from Tamil Nadu. Goods were transported by the consignor from Tamil Nadu to the ultimate purchaser, namely, Kerala State Civil Supplies Corporation, and therefore it was detained for the reason that the consignee, namely, Kerala State Civil Supplies Corporation, has not placed any orders with the supplier in Tamil Nadu. However, petitioner, furnished security and got release of the goods. According to the petitioner, even though petitioner has taken registration under the KGST Act, and goods were supplied to the Civil Supplies Corporation after release from the checkpost, the Corporation rejected the consignments as goods did not conform to the quality. After enquiry 2 penalty was levied for attempted evasion of tax due under the KGST Act. Even though petitioner claimed return of goods 10 days after rejection of the same, the Officer still levied penalty for the reason that there is no proof of return of goods outside Kerala. The First Appellate Authority confirmed the penalty for the reason that there is no proof of return of goods, as claimed by the petitioner. The Tribunal dismissed the second appeal and hence this Revision Petition before us. 2. Counsel for the petitioner has relied on the decision of the Supreme Court in ASST. COMMR., ANTI-EVASION, CT V. AMTEK INDIA LTD., (2007) 6 VST 242 (SC) and contended that delay in return of goods is no ground for levy of penalty. Government Pleader on the other hand referred to the findings of the first appellate authority that there is no entry in the checkpost about the return of goods to the Tamil Nadu. After hearing both sides and on going through the orders of the lower authorities, we notice that the goods in respect of which penalty is levied, reached Kerala pursuant to purchase orders issued by the petitioner to a Tamil Nadu party. Goods though presented before the ultimate purchaser, namely, the Kerala State Civil Supplies Corporation, were returned by them rejecting them as unsuitable for their requirement. Since petitioner has taken registration, and supply 3 made on behalf of the petitioner was rejected, it was the duty of the petitioner to prove as to what happened to the goods subsequently. There is nothing to indicate that the goods have been returned or taken back from Kerala to Tamil Nadu, as claimed by the petitioner. In the circumstances, the only inference is that goods are sold in Kerala, in respect of which admittedly no tax is paid. Even though counsel for the petitioner submitted that it was the duty of the outside supplier to take back the goods and the petitioner is not concerned about it, we are unable to accept this contention because by getting release of goods by remittance of security, petitioner owns up consignments and thereafter petitioner cannot take the contention that supplier in Tamil Nadu is accountable to Kerala sales tax authorities. In the absence of any proof of transport of goods from out of Kerala, sale of goods in Kerala is without payment of tax, is the only inference possible. We therefore dismiss the Revision. (C.N.RAMACHANDRAN NAIR) Judge. (C.K. ABDUL REHIM) Judge. kk 4