IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.M.JOSEPH THURSDAY, THE 29TH JANUARY 2009 / 9TH MAGHA 1930 WP(C).No. 28684 of 2008(M) -------------------------- PETITIONER(S): --------------------- M/S.SASTHA STEELS (PVT) LTD., NIDA, KANJIKODE, PALAKKAD, REP. BY ITS ACCOUNTS MANAGER, SUBHASH.M. BY ADV. SRI.K.SRIKUMAR SRI.K.MANOJ CHANDRAN RESPONDENT(S): ------------------------ 1. THE INTELLIGENCE INSPECTOR, INTELLIGENCE SQUAD NO.VII, COMMERCIAL TAXES, PALAKKAD. 2. THE INTELLIGENCE OFFICER O/O.THE DEPUTY COMMISSIONER (INTELLIGENCE), COMMERCIAL TAXES PALAKKAD. BY GOVERNMENT PLEADER SHRI C.K. GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 29/01/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: K. M. JOSEPH, J. -------------------------------------- W.P.C. NO. 28684 OF 2008 M -------------------------------------- Dated this the 29th January, 2009 JUDGMENT Petitioner is a Company engaged in the production of iron and steel products. An inspection was conducted on 05.09.2007 by the first respondent. He prepared Ext.P1 Report. Certain Slips were recovered. According to the petitioner, the second respondent verified the records which were called for on 27.09.2007. On the very same day, it is contended, in a calculated manner, a hand-written notice was given stating that the Books of Accounts of the petitioner were incorrect and incomplete and there is turnover suppression. It is stated that the second respondent without allowing any time or opportunity to explain the alleged irregularities, threatened to impose huge penalty and prosecute the petitioner Company and the individual Directors of the Company, if the petitioner did not sign an application for compounding as dictated by the first respondent. In such an atmosphere of stress and strain, it is the case of the WPC.28684/08 M 2 petitioner that the petitioner could not continue the business and would have to close down the business. Petitioner filed Ext.P2 application and a Statement was obtained. Rs.2,00,000/= was collected as compounding fee as evident from Ext.P3. Thereafter, Ext.P4 order is passed. According to petitioner, petitioner is maintaining proper Books of Accounts and there is no justification or materials to allege turnover suppression. Petitioner challenges Ext.P4. 2. I heard Shri K. Manoj Chandran, learned counsel for the petitioner and the learned Government Pleader. A Statement is filed on behalf of the respondents. According to the respondents, of course, on 12.09.2007 the authorised representative of the petitioner had filed authorisation and produced the Books of Accounts. The verification was completed after thirteen days ie. on 27.09.2007, it is stated. It is also stated that the petitioner has remitted the amount in four instalments and there is a denial of the contention that there was great pressure and threat for compounding. A Reply Affidavit is WPC.28684/08 M 3 filed, inter alia, stating that the entire process of checking and finalisation of Accounts, preparation and service of notice and all the procedure for composition of offence including collection of compounding fee were completed in one day and the petitioner was not given even one day's time to explain the alleged irregularities. It is stated that the Books contain signature of the respondent only on 27.09.2007. Learned counsel for the petitioner reiterates the contentions. He also relied on a decision of the Karnataka High Court in K.M. Puttaswamy v. Commercial Tax Officer (Intelligence), Mysore Circle, Mysore ((1988) 68 STC 41) to contend that the practice of compounding being completed within one day is not to be approved. He contends that there is violation of the principles of natural justice. Per contra, learned Government Pleader points out that the petitioner filed the application and the only three aspects which were to be considered were as mentioned in Ext.P2 application. He also refers to the decisions of this Court in Sree Sastha Trading Co. v. State of Kerala (1991 (2) KLT WPC.28684/08 M 4 875), Chandrahasan v. State of Kerala (1994 (2) KLT 222) and Biju Ramesh v. Intelligence Officer, Kerala ((1997) 107 STC 374) to point out that it is not open to the petitioner, after having filed the application for compounding, to turn round and question it. There is no dispute that notice dated 12.9.2007 was given. According to petitioner, the Books of Accounts were produced only on 27.9.2007. 3. Admittedly, there was an application filed for compounding. Petitioner remitted Rs.2 Lakhs by way of compounding fee. It is further stated that the petitioner has remitted the entire amount in instalments. More importantly, it is to be noted that the compounding took place on 27.9.2007. The Writ Petition is filed only on 25.09.2008. Petitioner is a Company. First of all, in proceedings under Article 226 of the Constitution of India, it may be, at best, a disputed question of fact as to whether there was pressure applied on the petitioner. There is a presumption that the official acts are done in accordance with law. I also note that the petitioner has chosen WPC.28684/08 M 5 to wake up and challenge the proceedings after nearly one year. This delay is a telling circumstance which dissuades me from extending the discretionary jurisdiction under Article 226 in the aid of the petitioner. I decline jurisdiction and dismiss the Writ Petition. Sd/= K. M. JOSEPH, JUDGE kbk. // True Copy // PS to Judge