IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.R.RAMACHANDRA MENON WEDNESDAY, THE 26TH MAY 2010 / 5TH JYAISHTA 1932 WP(C).No. 16050 of 2010(E) -------------------------- PETITIONERS: --------------- M/S.SATHISHKUMR AND BROTHERS, BIG BAZAR,CALICUT,REPRESENTED BY ITS PARTNER, HIMANSHU.S.SHAH. BY ADV. MR. N.MURALEEDHARAN NAIR MR. T.G.ABHILASH RESPONDENT: --------------- INTELLIGENCE INSPECTOR,SQUAD NO.I, COMMERCIAL TAXES,ERNAKULAM. BY SENIOR GOVERNMENT PLEADER MR. C.K. GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 26/05/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: P.R. RAMACHANDRA MENON J. ~~~~~~~~~~~~~~~~~~~~~~~ W.P. (C) No. 16050 of 2010 ~~~~~~~~~~~~~~~~~~~~~~~ Dated, this the 26th day of May, 2010 JUDGMENT The petitioner is challenging the sustainability of Ext.P4 notice of detention under Section 47 (2) of the KVAT Act whereby 177 bags of 'flat gram' transported by the petitioner in the vehicle bearing TN 27 A 2535 were intercepted by the respondent on 24.5.2010, doubting evasion of tax and demanding security deposit to the extent as specified therein. 2. The defects noted in Ext. P4 are as follows: “The goods with vehicle has been intercepted and checked at N.H. Bye Pass Road, Edappally on 24.05.2010 at 16.15 hours. On verification of accompany documents seen that the goods are flat gram that have been sold by M/s Balaji, Pollachi to M/s Satheesh Kumar and Brothers, Calicut dealer having TIN 32110296625. This is as per invoice No. 4 at 23.05.2010. It is also mentioning in the accompanying invoice, goods delivery at Kerala State Civil Supplies Corporation Depot, Haripad. No other document is available with the driver of the vehicle at the time of interception and checking. The goods are actually consigned to M/s Sathishkumar & Brothers,, Calicut by way of sale are being transported for delivery at Civil Supplies Depot, Haripad without any documents in support of first point of sale in the State being effected by this dealer at Calicut to Kerala State Civil Suppliers Corporation. It is suspected that the intention of the dealer is to suppress the sales turnover in the sale at the first point of sale within the State. It is also suspecting that there is every chance of the goods being sold to somebody else other than State Civil W.P. (C) No. 16050 of 2010 : 2 : Suppliers Corporation in the State after securing the delivery of the goods and invoice. Hence, value of the goods has been estimated after considering weight and gross profit and security deposit has been demanded to protect the interest of the revenue”. 3. The learned counsel for the petitioner submits that, there is absolutely no rhyme or reason for having detained the vehicle as well as the goods in view of the materials on record, particularly, since Ext.P2 invoice issued by the seller in Pollachi in the name of the petitioner also contains a clear endorsement that the goods were to be delivered at the premises of the Kerala State Civil Supplies Corporation, Haripad and on the way, the goods were intercepted by the respondent at Edappally leading to issuance of Ext.P4. The learned counsel further submits that, Ext.P2 clearly bears the seal of all the check post authorities, that the goods were purchased by the petitioner on the basis of Ext.P1 purchase order issued by the Kerala State Civil Supplies Corporation and that the petitioner has already issued Exts.P3 and P3(a) invoices, with regard to the sale in Kerala, to the Kerala Civil Supplies Corporation, which have been sent by post to the concerned purchaser. 4. The learned Government Pleader appearing for the respondent submits that, the only document which accompanied the transport was Ext.P2 and that Ext.P3/P3(a) invoices were never there. It is stated that, the goods pursuant to Ext.P2 sale have already been W.P. (C) No. 16050 of 2010 : 3 : delivered to the petitioner and that there was no document with regard to the subsequent sale effected by the petitioner in Kerala, so as to justify the transportation to Haripad. The learned Government Pleader also submits that, the delivery schedule as borne by Ext.P1 purchase order dated 22.5.2010 issued by Kerala State Civil Supplies Corporation was between 05.06.2010 and 14.06.2010 and as such, the transportation of the goods on the date of detention can only be of some other consignment. The learned counsel for the petitioner however strongly rebuts the said proposition stating that, as borne by the 'Note' on Ext.P1, the first load to the depot had to be supplied on or before 5.6.2010 and the other date was with regard to the last supply. This Court however finds that, this matter requires to be finalized in proper adjudication proceedings, particularly as to whether the explanation offered from the part of the petitioner is correct or not. . Considering the facts and circumstances, this Court finds that the goods can be released to the petitioner,on condition that the petitioner satisfies the demand, by furnishing 'bank guarantee' (for the amount demanded as security deposit in Ext.P4); on which event, the goods shall be released to the petitioner forthwith. This will be without prejudice to the rights and interests of the respondents to pursue the adjudication proceedings, if any and the same shall be finalized in accordance with law, as expeditiously as possible, at any rate, within a W.P. (C) No. 16050 of 2010 : 4 : period of two months from the date of receipt of a copy of the judgment. The Writ Petition is disposed of. P. R. RAMACHANDRA MENON, JUDGE kmd