IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR THURSDAY, THE 19TH JUNE 2008 / 29TH JYAISHTA 1930 WP(C).No. 5460 of 2005(Y) ------------------------- PETITIONER: ------------ COMBINED FOODS PVT. LTD., KOTTIYAM, KOLLAM, REPRESENTED BY ITS DIRECTOR, JOSEPH SIMON. BY ADV. SRI.K.I.MAYANKUTTY MATHER SRI.SUNIL SHANKER RESPONDENTS: ------------- 1. INTELLIGENCE OFFICER, SQUAD NO.II, COMMERCIAL TAXES, KOLLAM AT KOTTARAKKARA. 2. SRINIVAS BUTTER AND CASHEW NUT AGENCIES, PALLURUTHY, KOCHI-6. R1 BY G.P. SRI.TEK CHAND BY ADV. SMT.LAKSHMI FOR R2 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 19/06/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: APPENDIX PETITIONER'S EXHIBITS: P1: TRUE COPY OF NOTICE ISSUED U/S.29A ON THE PETITIONER PROPOSING PENALTY PROCEEDINGS DT.4.6.2003. P2: TRUE COPY OF VERSION FILED BY THE PETITIONER BEFORE R1 DT.7.5.2004. P3: TRUE COPY OF ORDER OF R1. RESPONDENT'S EXHIBITS: R2(a): TRUE COPY OF APPEAL FILED BY THE PETITIONER BEFORE THE APPELLATE ASSISTANT COMMISSIONER, COMMERCIAL TAXES, KOLLAM DT.18.3.2005. TRUE COPY PA TO JUDGE C.N.RAMACHANDRAN NAIR, J. .................................................................... W.P.(C) No.5460 of 2005 .................................................................... Dated this the 19th day of June, 2008. JUDGMENT Petitioner's case is that since penalty is levied on the second respondent, security furnished by the petitioner for release of goods at the time of detention should be refunded to the petitioner. Petitioner's claim is not tenable because the security collected for release of goods is for adjustment towards penalty. If petitioner had not furnished security, goods would have remained with the department and penalty would have been recovered by sale of the goods. Security, whoever furnishes for release of goods, can be adjusted towards penalty levied later. Since the dispute between petitioner and second respondent is to be settled between them, the department need not involve in the same. However, since appeal is filed against penalty order, there will be direction to the appellate authority to dispose of the appeal at the earliest. If appeal is allowed, refund should be granted to the petitioner as petitioner has paid the security. However, if penalty is confirmed, then it is open to the petitioner to claim the same from second respondent. C.N.RAMACHANDRAN NAIR Judge pms