IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 9TH NOVEMBER 2010 / 18TH KARTHIKA 1932 WP(C).No. 33198 of 2010(Y) -------------------------- PETITIONER: ------------------ SHUBH KARAN BAID, M/S.VIJEX & VIJEX, SHENOY JUNCTION, NARAKATHARA ROAD, ERNAKULAM. BY ADVS. SRI.HARISANKAR V. MENON SMT.MEERA V.MENON SRI.MAHESH V.MENON RESPONDENTS: ----------------------- 1. COMMECIAL TAX OFFICER, 4TH CIRCLE, ERNAKULAM-682 003. 2. DEPUTY COMMISSIONER (APPEALS) DEPARTMENT OF COMMERCIAL TAXES, ERNAKULAM-682 003. 3. INSPECTING ASST.COMMISSIONER DEPARTMENT OF COMMERCIAL TAXES, KAKKANADU, ERNAKULAM-682 030. BY SENIOR GOVERNMENT PLEADER SRI.C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 09/11/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: VK C.K. ABDUL REHIM, J ------------------------------ WP(C) NO. 33198 OF 2010 ------------------------------------ Dated this the 9th day of November, 2010 JUDGMENT With respect to year 2007-08, assessments were completed against the petitioner under the Kerala Value Added Tax Act, 2003 (KVAT Act) as well as the Central Sales Tax Act (CST), as per Exts.P1 and P2 orders, respectively. Exts.P3 and P4 are the appeals filed against those assessments, before the 2nd respondent appellate authority. Along with the appeals, the petitioner had filed interim applications seeking stay of collection of the tax amount in dispute, pending disposal of the appeals. The stay petitions were disposed of through a common order Ext.P5. The 2nd respondent had granted stay imposing a condition for payment of 50% of the total amount due and on furnishing security for the balance amount. Ext.P5 order is under challenge in this Writ Petition. 2. According to the petitioner, Ext.P2 assessment 2 WP(C) No. 33198/2010 under the CST Act was finalized rejecting the claim for exemption in relation to the turnover of inter-state sales for want of C-Form declarations. It is stated that the required C-Form declarations were obtained subsequently and they were produced before the appellate authority, at the time when the interim applications were heard. Exts.P7 and P8 are the copies of the C-Form declarations produced in this regard. It is a contention of the petitioner that in spite of production of C-Form declarations, the appellate authority observed that the petitioner had failed to produce the statutory forms before the assessing authority in time, and the reason for non production was not substantiated. According to the petitioner, if the C-Form declarations (Exts.P7 and P8) are accepted, there will not be any liability for payment of Central Sales Tax. It is also contended that the assessment made under KVAT Act as per Ext.P1, also deserves reconsideration since the turnover assessed is highly unreal. 3 WP(C) No. 33198/2010 3. Challenge against the interim order is on the premise that the appellate authority had insisted for payment of 50% of amounts, in a quite mechanical manner without proper application of mind. It is pointed out that inspite of production of the C-Forms the appellate authority had not adverted to those documents and not considered the veracity of those documents. It is further contended that the appellate authority has not stated any specific reasons for imposition of the condition and no reason is stated as to why the assessee is not entitled for an absolute stay. Reliance was placed on a Division Bench decision of this Court in Supreme Electrical Engg. Pvt. Ltd. Vs. Commercial Tax Officer [2008 (3) KLT 805], in order to contend that lack of mentioning such reasons will vitiate the order. 4. Having considered the facts and circumstances, I am of the opinion that the production of C-Form declaration is a matter which ought to have been considered while 4 WP(C) No. 33198/2010 granting the interim order. The documents produced in this regard will prove that a prima facie case has been established by the petitioner for granting absolute stay. Under such circumstances, I am of the opinion that, ends of justice will be served by directing the appellate authority to have an early disposal of the appeals and till then to restrain the recovery subject to imposing lesser rigorous conditions. 5. In the result, the Writ Petition is disposed of directing the 2nd respondent to consider and pass orders on Exts.P3 and P4 appeals, 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. Ext.P5 order is modified to the extent of granting stay till the disposal of the appeals on condition of the petitioner remitting 50% of amount covered under Ext.P1 order of assessment and on furnishing security bond with 5 WP(C) No. 33198/2010 respect to the entire amounts under Exts.P2 order of assessment, and also furnishing security bond for the entire balance, within a period of two weeks from the date of receipt of a copy of this judgment. C.K. ABDUL REHIM JUDGE dnc