IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 3RD DECEMBER 2009 / 12TH AGRAHAYANA 1931 WP(C).No. 34577 of 2009(N) -------------------------- PETITIONER(S): --------------- SHRI.VIJU V.K., VANACHIRAKAL HOUSE, THENGODE, KOCHI 682030. BY ADV. SRI.DALE P.KURIEN RESPONDENT(S): --------------- 1. COMMERCIAL TAX OFFICER (WT & LT), ERNAKULAM. 2. THE INTELLIGENCE INSPECTOR, SQUAD NO.II, COMMERCIAL TAXES, PATHANAMTHITTA. 3. THE SUPERINTENDING ENGINEER, BUILDINGS & LOCAL WORKS, SOUTH CIRCLE, THIRUVANANTHAPURAM. GOVERNMENT PLEADER SRI.V.K.SHAMSUDHEEN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 03/12/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.K.ABDUL REHIM, J. ------------------------------ W.P.(C).No. 34577 OF 2009 ------------------------------ Dated this the 3rd day of December, 2009 J U D G M E N T ---------------------- 1. Petitioner is aggrieved by detention of timber planks transported, on issuing Ext.P9 notice by the 2nd respondent, under Section 47(2) of the Kerala Value Added Tax Act, 2003 (KVAT Act). According to the petitioner he is a registered dealer under the KVAT Act, a works contractor, who has undertaken construction of a school building on behalf of the Union Government, at Alappuzha. According to the petitioner the timber planks were purchased as standing timber on payment of value to the owner of the property, as per Ext.P6. Ext.P7 is the bill evidencing payment of sawing charges. It is the case of the petitioner that the swan timber was transported to his work site for using in the building construction. 2. On a perusal of Ext.P9 it is revealed that the reason for detention is that the value shown in the document accompanying the transport is too low when compared with the value adopted for same kind of goods by similar dealers in this field of business. Therefore security deposit was demanded on the basis of value estimated by the 2nd respondent. W.P.(C).34577/09-N 2 3. According to the petitioner he is not a dealer engaged in sale of timber. On the other hand the timber in question was purchased for own use, from the owner of the property as standing timber. Being a works contractor the petitioner is paying tax on the basis of value of goods transmitted in execution of contract. It is contended that even assuming that the value shown in the document is not correct, there is no instance of tax liability with respect to the transaction in question. On the other hand, at the most there can be a suspicion only with respect to evasion of purchase tax, is the contention. But a detention under Section 47 cannot be made on the basis of such a suspicion, according to the petitioner. 4. I am of the opinion that the question whether there was any attempt at evasion of payment of tax need not be decided in this proceedings, since an adjudication as contemplated under Section 47. It is noticed that the petitioner is a registered dealer and a works contractor. Normally the tax due on the contract bill will be deducted by the awarder at the time of payment. Therefore in my considered opinion the goods can be released pending finalisation of the adjudication on the petitioner furnishing proper security. 5. In the result the 2nd respondent is directed to release W.P.(C).34577/09-N 3 the goods detained under Ext.P9 along with the vehicle, on the petitioner furnishing security bond in the form prescribed under the KVAT Rules, without sureties, for the value demanded under Ext.P9. 5. The competent authorities under Section 47(5) and (6) are directed to expedite adjudication and to finalise the same after affording an opportunity of hearing to the petitioner, as early as possible, at any rate within a period of one month from the date of release of the goods. C.K.ABDUL REHIM, JUDGE. okb