IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM MONDAY, THE 23RD NOVEMBER 2009 / 2ND AGRAHAYANA 1931 WP(C).No. 33644 of 2009(A) -------------------------- PETITIONER(S): --------------- P.H. HAMEED, PROPRIETOR, BADARIYA TIMBER DEPOT, EDAVETTY, THODUPUZHA. BY ADV. SRI.E.P.GOVINDAN RESPONDENT(S): --------------- 1. THE INTELLIGENCE INSPECTOR, SQUAD NO.I, COMMERCIAL TAXES, MATTANCHERRY AT ALUVA, ERNAKULAM DISTRICT. 2. STATE OF KERALA REPRESENTED BY SECRETARY, TAXES DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM. GOVERNMENT PLEADER SRI.V.K.SHAMSUDHEEN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 23/11/2009, THE COURT ON DELIVERED THE FOLLOWING: C.K.ABDUL REHIM, J. ------------------------------ W.P.(C).No.33644 OF 2009 ------------------------------ Dated this the 23rd day of November, 2009 J U D G M E N T ---------------------- 1. Petitioner is aggrieved by detention of transport of timber, by the 1st respondent on issuing Ext.P1 notice under Section 47(2) of the Kerala Value Added Tax Act, 2003 (KVAT Act). According to the petitioner the goods transported is part of timber auctioned by him from the Forest Department of the State of Kerala and it is transported on the basis of Forest Pass as evidenced by Ext.P6. The transport was effected pursuant to sale by the petitioner to another dealer, which is evidenced by Ext.P2 'tax invoice'. The reason for detention mentioned in Ext.P1 is that a slip recovered from the cabin of the vehicle revealed that the actual value at which the goods were sold is Rs.2,20,000/- whereas the value shown in the documents accompanying the transport is Rs.1,40,000/- only. Hence security deposit to the tune of double the amount of tax on the differential value is demanded. 2. Learned Government Pleader for respondents had produced a copy of the slip alleged to have been recovered from the vehicle for my perusal, whih showed the value along with lot W.P.(C)..33644/09-A 2 number written on a white paper as Rs.2,20,000/-. According to he petitioner he is not at all responsible for any such slip and the e is no such conclusive proof that the slip contained value of the goods under transport. 3. However, the matter need adjudication based on evidence. The question as to whether there was any undervaluation of the goods and as to whether there was any attempt at evasion of payment of tax are matters to be decided on finalisation of the adjudication. I am of the opinion that the goods need not be detained till such finalisation and it can be released on the petitioner furnishing adequate security. 4. Under the above circumstances the writ petition is disposed of directing the 1st respondent to release the goods detained under Ext.P1 notice along with vehicle, on the petitioner making payment of 50% of the security deposit demanded under Ext.P1 towards 'Advance Tax' without prejudice to finalisation of proceedings under Section 47 and without prejudice to imposition of penalty, if ultimately found liable. The petitioner shall also furnish the security bond in the form provided under the KVAT Rules, without sureties, for the amount of security deposit demanded under Ext.P1. 5. The competent authority under Section 47 is directed to expedite and finalise the adjudication after affording an W.P.(C)..33644/09-A 3 opportunity of hearing to the petitioner, untrammeled by any observations made herein, as early as possible, at any rate within two months from the date of release of the goods. C.K.ABDUL REHIM, JUDGE. Okb