IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.VINOD CHANDRAN TUESDAY, THE 6TH DECEMBER 2011 / 15TH AGRAHAYANA 1933 WP(C).No. 29416 of 2007(B) -------------------------- PETITIONER(S): ---------------------- M/S SRI LAKSHMI ELECTROMELTERS(P)LTD., 182, INDUSTRIAL DEVELOPMENT AREA, ERUMATHALA P.O., ALUVA, REPRESENTED BY ITS GENERAL MANAGER. BY ADV. SRI.J.JULIAN XAVIER SRI.FIROZ K.ROBIN RESPONDENT(S): ------------------------- 1. STATE OF KERALA, REPRESENTED BY ITS SECRETARY, TAXES DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM. 2. THE SALES TAX OFFICER, SALES TAX OFFICE, ALUVA, ERNAKULAM. 3. THE DEPUTY COMMISSIONER(APPEALS), DEPARTMENT OF COMMERCIAL TAXES, ERNAKULAM. 4. THE DEPUTY TAHSILDAR(REVENUE), REVENUE RECOVERY, ALUVA. BY GOVT. PLEADER SRI. MANOJ P KUNJACHAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 06/12/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C).No. 29416 of 2007(B) APPENDIX: PETITIONER'S EXHIBITS: EXT.P1: TRUE COPY OF THE PROCEEDINGS OF THE GENERAL MANAGER, DISTRICT INDUSTRIES CENTRE, ERNAKULAM. EXT.P2: TRUE COPY OF THE PROCEEDING OF THE GENERAL MANAGER, DISTRICT INDUSTRIES CENTRE, ERNAKULAM. EXT.P3: TRUE COPY OF THE NOTICE DATED 1.03.2006 ISSUED BY THE 2ND RESPONDENT. EXT.P4: TRUE COPY OF THE REPLY FILED BY THE PETITIONER ON 09.03.2006. EXT.P5: TRUE COPY OF THE ASSESSMENT ORDER DATED 21.03.2006 IN REGARD TO THE KGST ASSESSMENT FOR THE YEAR 2000-2001. EXT.P6: TRUE COPY OF ASSESSMENT ORDER DATED 21.03.2006 IN REGARD TO CST ASSESSMETN FOR THE YEAR 2000-2001. EXT.P7: TRUE COPY OF THE APPEAL MEMORANDUM DATED 26.06.2006 CHALLENGING KGST ASSESSMENT. EXT.P8: TRUE COPY OF THE APPEAL MEMORANDUM DATED 26.06.2006 CHALLENGING CST ASSESSMENT. EXT.P9: TRUE COPY OF THE COMMON INTERIM ORDER DATED 29.11.2006 IN STA Nos. 1517/06 AND 1518/06. EXT.P10: TRUE COPY OF INTERIM ORDER DATED 25.2.2004 IN W.P.(C) No.6073/2004. EXT.P11: TRUE COPY OF THE INTERIM ORDER DATED 26.2.2004 IN W.P.(C) 6500/2004. EXT.P12: TRUE COPY OF THE RECEIPT DATED 17.3.2004 FOR RS. 5 LAKHS ISSUED BY THE 4TH RESPONDENT. EXT.P12(a): TRUE COPY OF THE RECEIPT DATED 7.5.2004 FOR RS.2.5 LAKHS ISSUED BY THE 4TH RESPONDENT. EXT.P12(b): TRUE COPYOF THE RECEIPT DATED 25.3.2004 FOR RS. 5 LAKHS ISSUED BY THE 4TH RESPONDENT. EXT.P13: TRUE COPY OF THE JUDGMENT DATED 11.8.2005 IN W.P.(C) No.6500/2004. EXT.P14: TRUE COPY OF THE CHALAN ISSUED BY THE 2ND RESPONDENT COLLECTING THE COMPOUDING FEE FOR THE ASSESSMENT YEAR 1998- 99. EXT.P14(a): TRUE COPY OF THE CHALAN ISSUED BY THE 2ND RESPONDENT COLLECTING THE COMPOUNDING FEE FOR THE ASSESSMENT YEAR 1999-2000. EXT.P15: TRUE COPY OF THE REVENUE RECOVERY NOTICE DATED 29.9.2006 ...2) WP(C).No. 29416 of 2007(B) -2- EXT.P16: TRUE COPY OF THE JUDGMENT DATED 20.12.2006. . EXT.P17: TRUE COPY OF THE ORDER DATED 22.1.2007 EXT.P18: TRUE COPY OF THE JUDGMENT DATED 22.1.2007 IN W.P.(C) No.5618/2007 RESPONDENTS' EXHIBITS: NIL. TRUE COPY P.A. TO JUDGE. K.VINOD CHANDRAN,J. --------------------------------------- W.P.(C) No. 29416 of 2007 ---------------------------------------- Dated this the 6th day of December, 2011 JUDGMENT The petitioner is a private limited company and is an assessee under the KGST as well as the CST Act. The petitioner was granted exemption as per SRO 1729/1993 evidenced by Ext.P1 and also was granted further exemption for additional investment by Ext.P2. The petitioner had unaccounted interstate purchases in the years 1998-1999, 1999-2000, 2000-2001 and hence the exemption granted as per Ext.P1 and P2 was denied in view of the amendments brought about by SRO 295/98. The petitioner along with other assessees, similarly placed, challenged the amendments brought in by SRO 295/98 in a batch of writ petitions before this Court. It is the case of the petitioner, the petitioner had challenged the denial of exemption for the year 1998-1999 and 1999-2000 in separate writ petitions numbered as W.P.(C) No.6073/2004 and W.P.(C) No.6500/2004. In the said writ petitions this Court had passed interim directions W.P.(C). No. 29416 of 2007 -2- requiring the petitioner to pay ` 5,00,000/-(Rupees Five lakhs only) and ` 7,50,000/-(Rupees Seven lakhs fifty thousand only) respectively for the two years. The petitioner has paid the said amounts which stands admitted by the Government in their counter affidavit. Ultimately, the writ petitions filed against the amendment brought in by SRO 295/98 was decided by this Court by Ext.P13 judgment upholding the same. While the amendment with respect to the denial of exemption was upheld by this Court, this Court also provided for some relief to the petitioners by directing that if an application for compounding is made along with the copy of the judgment the same shall be accepted after receiving the compounding fee and the liability computed, in tune with the impugned notification, within two weeks. It was also directed that on recovery of compounding fee and twice the amount of tax as provided in the notification, the petitioners shall be granted exemption as having satisfied the conditions in the notification. 2. The petitioner has a case that, subsequent to the judgment the petitioner approached the competent authority with W.P.(C). No. 29416 of 2007 -3- an application as directed by this Court and complied with the terms of the notification, thus making him eligible for exemption for the years 1998-1999 and 1999-2000. The petitioner's grievance, in short, is that having complied with the terms of the notification, the amounts deposited as per the terms of Ext.P10 and P11 interim orders are to be refunded to the petitioner and adjusted against the dues for the year 2000-2001. 3. It is pertinent to note that in the year 2000-2001 also the petitioner had suppressed interstate purchase, based on which the petitioner was denied exemption for that year. The petitioner also has a case that though he was ready to compound the offence with respect to eight transactions he had specifically pointed out to the assessing officer that the three of the eleven transactions alleged against him were actually disclosed in the books of account. The said issue is not pending before this Court, since admittedly an appeal has been filed for the year and the same is still stated to be pending. It is also found from the records that the petitioner has twice approached this Court against interim orders passed by the appellate authority and W.P.(C). No. 29416 of 2007 -4- Ext.P16 and P18 judgments were passed directing the appellate authority to reconsider the said application and till the disposal of the appeal itself, to keep the recovery in abeyance. Pursuant to Ext.P18, the petitioner says that no orders have been passed by the appellate authority. 4. The petitioner's present case is on the premise that on the petitioner compounding the offence for the year 1998-1999 and 1999-2000 in terms of SRO 295/98, the petitioner is entitled to refund of the amounts minus the collection charges. The prayers made by the petitioner in the writ petition is also to this effect. The State has filed a counter affidavit wherein it has been clearly stated that from the amounts remitted in compliance of the conditions prescribed by this Court by Ext.P10 and P11, the demand against the petitioner as per the modified orders passed in pursuance to Ext.P13 judgment has been adjusted and balance amounts appropriated under Section 55 C of the KGST Act towards the interest due for the year 2000-2001. The petitioner has no challenge against Section 55 C, nor can there be any, since the said provision has already been upheld by this Court. W.P.(C). No. 29416 of 2007 -5- The amounts remitted by the petitioner in compliance with Ext.P10 and P11 orders are no more available for refund due to the automatic appropriation as provided under Section 55 C of KGST Act. It goes without saying that the appropriation as also the payment for the year 2000-2001 shall depend upon the orders to be passed in the appeal. In the aforesaid circumstances, the amounts remitted by the petitioner by Ext.P10 and P11 having been appropriated under the KGST Act towards amounts due from the petitioner, there is no question of refund at this stage. The writ petition is hence without merit. 5. The petitioner also submits that appeals filed by him for the year 2000-2001 under the KGST and CST Acts produced herewith as Ext.P7 and P8 are still pending before the 1st appellate authority and that a direction be issued for the speedy disposal of the same. Though the aspects of the appeal is not an issue projected in this writ petition, considering the fact that the petitioner had been consistently before this Court challenging the interim orders passed in the appeal, I am of the view that appropriate directions can be issued to the third respondent to W.P.(C). No. 29416 of 2007 -6- dispose of the appeals expeditiously. The petitioner shall present himself before the Deputy Commissioner (Appeals) on the 20th of December, 2011 and the Deputy Commissioner shall hear the petitioner on the same date or on any date within two weeks thereafter and the appeal itself shall be disposed of within a period of three months therefrom. The petitioner shall co- operate with the proceedings. The writ petition is dismissed, but with the above directions to the 3rd respondent. No costs. K.VINOD CHANDRAN, JUDGE. Kp/-