IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE K.SURENDRA MOHAN TUESDAY, THE 31ST MARCH 2009 / 10TH CHAITHRA 1931 ST.Rev..No. 32 of 2007() ---------------------------------- TA.109/2006 of SALES TAX APPELLATE TRIBUNAL,ADDL.BENCH,PALAKKAD .................... PETITIONER(S) / RESPONDENT/ RESPONDENT/ REVENUE ------------------------ STATE OF KERALA, REP.BY JOINT COMMISSIONER (LAW) IN- CHARGE, COMMERCIAL TAXES, ERNAKULAM. BY GOVERNMENT PLEADER MR.V.K.SHAMSUDEEN RESPONDENT(S): APPELLANT/APPELLANT/ ASSESSEE ----------------------- M/S.GRAMY TREADS, ANAMANGAD, TIRUR. BY ADVS.MR.K.ANAND (A.201) FOR R1 SMT.LATHA KRISHNAN FOR R1 THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 31/03/2009, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: C.N.RAMACHANDRAN NAIR & K.SURENDRA MOHAN, JJ. ------------------------------------------------------------------------------------ S.T.Revn. NO: 32 OF 2007 ----------------------------------------------------------------------------------- Dated this the 31st March, 2009. JUDGMENT RAMACHANDRAN NAIR, J. Revision is filed by the State challenging the cancellation of interest levied under Section 23(3) and 23(3A) of the KGST Act for the year 2002-03. 2. We have heard Govt. Pleader appearing for the petitioner and counsel appearing for the respondent. 3. The case of the State is that respondent had conceded tax at 10% and in spite of the same they did not remit the tax so conceded but contested the levy before the first appellate authority. Therefore, interest is automatic is his case. Counsel appearing for the respondent on the other hand contended that there was a bonafide dispute with regard to the rate of tax which got settled in favour of the appellant by decision of the appellate authority. So much so there was no default attracting liability for interest is his case. We notice that the Assessing Officer has not considered the assessee's reply to pre-assessment notice, concessions in rate of tax claimed by the assessee etc before determining liability for S.T.Revn. 32/2007 2 interest. We therefore feel the matter should be remitted back to the Assessing Officer for considering the interest question after going through the returns, pre-assessment notice and the reply filed. Sales tax revision is therefore allowed vacating the order of the Tribunal on the question of interest but by remanding the case back to the Assessing Officer to issue notice and raise interest on the respondent if they are liable under Section 23(3) and 23(3A) of the KGST Act. C.N. RAMACHANDRAN NAIR Judge K. SURENDRA MOHAN Judge jj K.K.DENESAN & V. RAMKUMAR, JJ. ---------------------------------------------------- M.F.A.NO: ----------------------------------------------------- JUDGMENT Dated: