IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 1ST DECEMBER 2009 / 10TH AGRAHAYANA 1931 WP(C).No. 34504 of 2009(G) -------------------------- PETITIONER(S): --------------- VITHOGA CHEMICALS (P) LIMITED, MALANKARA CENTRE, M.G.ROAD, ERNAKULAM, REPRESENTED BY ITS AUTHORISED SIGNATORY. BY ADVS. SRI.A.KUMAR SMT. G.MINI (1748) RESPONDENT(S): --------------- 1. THE FAST TRACK TEAM, COMMERCIAL TAXES DEPARTMENT, ERNAKULAM. 2. THE ASST.COMMISSIONER, DEPARTMENT OF COMMERCIAL TAXES, SPECIAL CIRCLE III, COMMERCIAL TAX COMPLEX, ERNAKULAM, KOCHI 682 015. BY GOVT. PLEADER SRI. V.K. SHAMSUDHEEN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 01/12/2009, ALONG WITH W.P.(C) NO. 34525/2009 , THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: shg/ C.K. ABDUL REHIM, J. - - - - - - - - - - - - - - - - - - - - - - - W.P.(C)No. 34504 and 34525 of 2009 - - - - - - - - - - - - - - - - - - - - - - - Dated this the 1st day of December, 2009 J U D G M E N T 1. Challenge in these writ petitions are against assessments completed under the provision of Section 17D of the Kerala General Sales Tax Act 1963 (KGST Act). A Division Bench of this court in a batch of cases filed challenging validity of Section 17 D, observed that if exorbitant demand of tax is as a result of arbitrary orders issued, which according to the petitioners are issued in violation of natural justice and without following the mandatory procedure provided under section 17D, it is not as if petitioners are totally without remedy. The constitutional remedy under Article 226 is available in such cases and it will be open to the parties seeking relief against such orders to approach this court and in such cases it is within the power of this court to mould appropriate reliefs. W.P.(C) Nos.34504 and 34525 of 2009 -2- 2. With respect to the procedure to be followed while passing assessments under section 17 D, the Division Bench observed as follows:- “Even though we have upheld the validity of the statutory provisions, we are unable to uphold the impugned assessments for the simple reason that the none of the assessments challenged in the Writ appeals or in the Writ petitions was completed in accordance with the procedure contemplated under section 17D. It is clear from clause (g) of Section 17 D(2) that the team constituted under section 17 (D) should fix the venue and date of hearing and hold sitting to hear the parties after issuing notice in advance to dealers concerned. Further, information in this regard should be published in local media as well. It is provided in Sub section (3)o f Section 17 D that all assessments under Fast Track Method should be unanimous decision signed by all team members. It is very clear from the scheme that all the team members should sit together, consider the returns filed, accounts and records produced, hear the parties or their representatives and suggest proposal for assessment. If an assessment by consent can be passed, then assessment order should be passed in accordance with the terms agreed in first sitting itself. The assessments that could be completed in the first sitting are cases where team of Assessing Officers accept the returns filed or with such additions which the party agrees. On the other hand, if assessment is proposed in deviation with turnover returned or against additions over and above if any agreed by the parties, then it is for the very same team to issue pre-assessment notice containing proposal for assessment and the same should be W.P.(C) Nos.34504 and 34525 of 2009 -3- signed by all of them. The party should be given sufficient time to file objections and the next date of public hearing by the committee should be informed to the party. Assessment has to be complete after hearing the party by team on the objection filed to the pre-assessment notice and in order to have a binding assessment, the assessment should be one completed with unanimous agreement of all the team members, In fact, ex-parte assessment is contemplated only when parties who are served notice informing the venue and date of hearing fail to appear. Here again, we are of the view that there is no harm in giving one more opportunity, if the team of officers feel that the party is not absenting deliberately. Since in all these cases assessments are completed by issuing pre-assessment notice by individual officers, we feel that the procedure contemplated and stated by us above is not strictly followed and so much so, orders passed cannot be sustained under the provision of Section 17 D. We, therefore allow the writ appeals and writ petitions in part by vacating the impugned assessment orders, but with direction to the assessment team to complete the assessment afresh under section 17 D within a period of three months from the date of receipt of copy of this judgment after issuing notice to all parties and after hearing their objections. We make it clear that each and every objection raised by the parties in the reply to pre-assessment notice should be considered and unanimous decision should be taken by the team members. We do not want to examine the other issues raised in some of the cases like challenge against other statutory provisions, challenge against penalty orders etc. These issues are left open. We leave freedom to the parties to challenge the penalty orders before statutory authorities because those are not issued under W.P.(C) Nos.34504 and 34525 of 2009 -4- section 17 D. So far as challenge against other statutory provision are concerned, we leave it open to the parties to raise any such challenge, if required, after completion of assessments afresh as stated above”. 3. In view of the directions contained in the Division Bench Judgment cited supra (Hindustan Petroleum Corporation Ltd. V. Assistant Commissioner and others: Writ Appeal No.1714/2009 and connected cases Jt:dt:8/10/ 2009), I am of the opinion that the impugned assessment in these writ petitions are not sustainable and hence matters need fresh disposal by the authority concerned. 4. Therefore the writ petitions are allowed quashing the impugned assessments finalised under section 17 D and also the consequential demands raised, if any, for realisation of amounts covered under such assessments. The respondent concerned, (The Fast Track Team) is directed to take fresh steps necessary for completing assessment taking note of the directions contained in the Division Bench judgment. The fresh assessment as directed above shall be completed as early as possible, at any rate W.P.(C) Nos.34504 and 34525 of 2009 -5- within a period of three months from the date of receipt of the copy of this judgment, after affording adequate opportunities to the petitioner as directed above. C.K. ABDUL REHIM JUDGE shg/