IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE B.P.RAY WEDNESDAY, THE 6TH APRIL 2011 / 16TH CHAITHRA 1933 ST.Rev..No. 45 of 2011() ------------------------ AGAINST ORDER IN TA.170/2010 DATED 12/11/2010 of S.T.A.T.ADDL.BENCH,ERNAKULAM .................... REVISION PETITIONER / APPELLANT / ASSESSEE -------------------- M/S.CANTEEN STORES DEPARTMENT AREA DEPOT, BOST BOX NO.2054, SANDHI NAGAR, KOCHI - 20 REPRESENTED BY ITS AREA MANAGER P.V.JOSEPH BY ADV. SRI.SANTHOSH P.ABRAHAM RESPONDENT(S): --------------- STATE OF KERALA REPRESENTED BY ITS FINANCE SECRETARY, SECRETARIAT, THIRUVANANTHAPURAM, PIN - 695 001. MR.MOHAMMED RAFEEQ, GOVERNMENT PLEADER THIS SALES TAX REVISION HAVING COME UP FOR ADMISSION ON 06/04/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.N.RAMACHANDRAN NAIR & BHABANI PRASAD RAY, JJ. ---------------------------------- S.T.Rev.No.45 of 2011 --------------------------------- Dated, this the 6th day of April, 2011 J U D G M E N T Ramachandran Nair, J. Heard the learned counsel for the petitioner and learned Government Pleader for the respondent. 2. The question raised is whether the Department is justified in levying penalty for non payment of 90% of the tax due before 31/03/2011 in terms of the Rules. The case of the petitioner is that funds have to be allotted from the Head Office for payments as well as for expenses. It is further pointed out that the amount payable is turn over tax which is not collected from the buyers. The Rule providing for payment of 90% of the tax before 31/03/2011 is not a new provision and therefore we see no justification for the petitioner's failure to arrange funds for payment within the due date. In fact compliance was there during the last year, and so much so, the delay in providing funds is a lapse on the part of the Officers concerned. S.T.Rev.No.45/2011 -2- 3. In any case, considering the fact that Canteen is an agency created for the benefit of the defence personnel, quantum of penalty was reduced from Rs.97 lakhs to Rs.10 lakhs by the first appellate authority and to Rs.5 lakhs by the Tribunal. We are told that interest is paid for the belated payment, which is at 1%. If interest is paid at 1% of the deficiency, then the same will work out to Rs.1 lakh. We, therefore, reduce the penalty to Rs.3 lakhs. Therefore the Revision case is allowed in part by modifying the Tribunal's order reducing the penalty to Rs.3 lakhs as against Rs.5 lakhs fixed by the Tribunal. If interest is not paid along with tax, interest also will be paid on the belated payment of advance tax. (C.N.RAMACHANDRAN NAIR, JUDGE) (BHABANI PRASAD RAY, JUDGE) jg