IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR FRIDAY, THE 11TH JANUARY 2008 / 21ST POUSHA 1929 OP.No. 21845 of 2001(A) ----------------------- PETITIONER: ------------ KESAVAN DAMODARAN GOPALAKRISHNAN, ALIAS K.D.GOPALAKRISHNAN, VELIYIL HOUSE, ERUVA WEST, ERUVA P.O., KAYAMKULAM, ALAPPUZHA DIST., REP. BY HIS POWER OF ATTORNEY HOLDER G.VIAJAYAN. BY ADV. SRI.V.P.SUKUMAR RESPONDENTS: ------------- 1. THE SALES TAX OFFICER (WC&LT), OFFICE OF THE DEPUTY COMMISSIONER, COMMERCIAL TAXES, ALAPPUZHA. 2. THE DEPUTY TAHSILDAR(R.R.), TALUK OFFICE, KARTHIKAPPALLY. 3. THE DISTRICT COLLECTOR, ALAPPUZHA. BY GOVERNMENT PLEADER SRI.K.P.PRADEEP THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 11/01/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ORDER ON C.M.P. NO.35545/2001 IN O.P. NO.21845/2001 DISMISSED: 11.1.2008 SD/-(C.N.RAMACHANDRAN NAIR, JUDGE.) APPENDIX PETITIONER'S EXHIBITS: P1: TRUE COPY OF POWER OF ATTORNEY EXECUTED BY THE PETITIONER IN FAVOUR OF SRI.G.VIJAYAN. P2: TRUE COPY OF NOTICE DT.7.2.2001 ISSUED TO THE PETITIOENR BY R1. P3: TRUE COPY OF REPLY DT.20.2.2001 SUBMITTED BY PETITIONER'S FATHER BEFORE R1. P4: TRUE COPY OF R.R. NOTICE DT.19.7.2001 ISSUED TO PETITIONER BY R2 U/S.7 OF THE RR ACT. P5: .DO. U/S.34 OF THE R.R. ACT. P6: TRUE COPY OF REPRESENTATION DT.20.7.2001 SUBMITTED BY FATHER IN LAW OF THE PETITIONER BEFORE R3. TRUE COPY PA TO JUDGE C.N. RAMACHANDRAN NAIR, J. -------------------------------------------- O.P. NO. 21845 OF 2001 -------------------------------------------- Dated this the 11th day of January, 2008 JUDGMENT Heard counsel for the petitioner and Government Pleader. Petitioner is challenging recovery proceedings for recovery of arrears of sales tax demanded from the petitioner under Section 7(7B) of the KGST Act read with Rule 22A(5) of the KGST Rules. According to the petitioner, petitioner is not served with copy of the assessment order. However, Government Pleader produced assessment order dated 26.3.2001 in Court and according to him, the order was served through affixture. 2. Counsel for the petitioner submitted that the order issued without notice to the petitioner and without hearing the petitioner is arbitrary and untenable. On going through the assessment order produced in Court, I do not think the same can be sustained in law because it is made purely on estimate without any basis. Petitioner's case is that house is around 577 sq. metres and going by the normal construction cost for residential house, the cost should not exceed Rs. 2 55 lakhs. But assessment is made on the turnover of Rs. 7.5 crores. The Officer did not obviously conduct any enquiry nor has he stated even the plinth area of the building. Even though Section 7B was declared invalid, Section 7C was introduced and therefore awarder was bound to deduct sales tax, if there was a contract. In the normal course, a person like the petitioner, who is residing abroad would have engaged a contractor for construction purpose. However, petitioner's case is that materials were purchased and construction was got done by his father- in-law. If this is the position, then purchase bills for purchase of materials and accounts for payment of labour charges will be available with the petitioner's father-in-law. Having regard to the circumstances, I feel one more opportunity can be given to the petitioner to produce bills and accounts before the first respondent for him to reconsider the matter and pass fresh orders. Even though assessment order is not produced in court, I declare that the assessment so issued on 26.3.2001 based on which recovery is initiated against the petitioner is invalid. Petitioner will produce a copy of this judgment along with entire records for construction of building before the first respondent and 3 appear before him within a period of six weeks from today. Even if petitioner is not in station, petitioner can authorise any person to produce records based on which first respondent will issue fresh orders after hearing petitioner's representative and after verifying the records. Final orders should be issued by the first respondent within a period of three months from today. Recovery proceedings will remain stayed for the amount stated therein, but as and when fresh orders are issued, first respondent will communicate the same to the second respondent for him to continue recovery for the said amount, if the petitioner does not make payment within the time granted. O.P. is disposed of as above. Issue photocopy tomorrow itself. (C.N. RAMACHANDRAN NAIR) Judge kk