IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 19TH NOVEMBER 2009 / 28TH KARTHIKA 1931 WP(C).No. 30038 of 2009(Y) -------------------------- PETITIONER(S): --------------- M/S.DLF HOME DEVELOPERS LTD., PDR BHAVAN, FORESHORE ROAD, ERNAKULAM, COCHIN-682 016, REPRESENTED BY ITS AUTHORISED SIGNATORY SRI.MATHEW JOSEPH, CHIEF MANAGER, KERALA. BY ADVS. SRI.SHAJI THOMAS PORKKATTIL SRI.BINU PAUL SRI.T.V.VINU RESPONDENT(S): --------------- 1. STATE OF KERALA, REPRESENTED BY THE SECRETARY, COMMERCIAL TAXES, GOVT.OF KERALA, TRIVANDRUM, KERALA. 2. COMMISSIONER OF COMMERCIAL TAXES, DEPARTMENT OF COMMERCIAL TAXES, TRIVANDRUM, KERALA. 3. ASSISTANT COMMISSIONER (WORKS CONTRACT) O/O.THE DEPUTY COMMISSIONER (WORKS CONTRACT) DEPARTMENT OF COMMERCIAL TAXES, ERNAKULAM, KERALA. 4. DEPUTY COMMISSIONER (APPEALS) DEPARTMENT OF COMMERCIAL TAXES, ERNAKULAM, KERALA. BY GOVT. PLEADER SRI. C.K. GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 19/11/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: shg/ C.K. ABDUL REHIM, J. - - - - - - - - - - - - - - - - - - - - - - - W.P.(C)No. 30038 of 2009 - - - - - - - - - - - - - - - - - - - - - - - Dated this the 19th day of November, 2009 J U D G M E N T 1. Challenge in this writ petition is against Ext.P5 order issued under Section 67 (2) of the Kerala Value Added Tax Act, 2003 (KVAT Act) through which penalty to the tune of Rs.37,69,940/- was imposed on the petitioner, based on the allegation that the petitioner failed to remit Tax due with respect to the year 2007-08 because they have failed to comply with the interim order issued by the first appellate authority insisting payment of 50%, as evidenced by Ext.P1. 2. In fact the petitioner had challenged Ext.P1 order in a writ petition,W.P.(C) No.27189/2009 before this court. The writ petition was heard on 29.09.2009 and it was reserved for judgment. Subsequently, through judgment dated 21.10.2009, this court had set aside Ext.P1 and modified the condition insisted for granting interim stay, to extent the payment of an amount of Rs.5 lakhs. In the W.P.(C)No. 30038 of 2009 -2- meanwhile notice proposing imposition of penalty was issued to the petitioner as evidenced by Ext.P2. According to the petitioner they have first submitted Ext.P3 reply stating that the appeal is pending consideration before the Deputy Commissioner and that the Deputy Commissioner had granted three weeks time to comply with the interim order. Further they have submitted Ext.P4 before the first appellate authority seeking extension of time granted for compliance of the condition, till this court pronounces judgment in the writ petition cited above. But through Ext.P5, the 3rd respondent had rejected request of the petitioner seeking time for filing objections, and imposed penalty as proposed. 3. In view of judgment of this court in W.P.(C) No.27189/2009, dated 21.10.2009, realisation of the amounts covered under the assessment for the year 2007-08 now stands stayed, till the disposal of the appeal by the first appellate authority. It is also submitted by the learned counsel for the petitioner that the conditions W.P.(C)No. 30038 of 2009 -3- imposed in the said judgment for payment of Rs.5 lakhs, has already been complied with. Therefore there is no arrears pending realisation with respect to assessment for the year 2007-08. Hence no penalty can be sustained on the allegation of non-payment of tax, due for the said year. 4. As observed above, since the allegation based on which the penalty was imposed is no more surviving, I am of the opinion that the order imposing penalty need be quashed. Accordingly the writ petition is allowed and Ext.P5 order is hereby quashed. Needless to say that the demand notice as well as the steps for recovery initiated pursuant to Ext.P5 will also stand quashed consequently. C.K. ABDUL REHIM JUDGE shg/