IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT :- THE HONOURABLE MR. JUSTICE K.VINOD CHANDRAN SATURDAY, THE 19TH NOVEMBER 2011 / 28TH KARTHIKA 1933 W.P.(C).No.11090 of 2007(T) ---------------------------------------- PETITIONER:- -------------------- M/S.KAIRALI BAR, SHORANUR ROAD, PALAKKAD, REPRESENTED BY ITS PARTNER, K.SIVARAMAN. BY ADV. SRI.N.MURALEEDHARAN NAIR SRI.V.K.SHAMUSUDHEEN RESPONDENTS:- ------------------------- 1. COMMERCIAL TAX OFFICER-IV, 1ST CIRCLE, PALAKKAD. 2. COMMISSIONER OF COMMERCIAL TAXES, PUBLIC OFFICE BUILDING, THIRUVANANTHAPURAM. 3. STATE OF KERALA, REPRESENTED BY SECRETARY TO GOVERNMENT, TAXES DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM. R1 TO R3 BY GOVERNMENT PLEADER SRI.BNOBBY JOHN PUTHENPURACKAL. THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 19/11/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:- APPENDIX PETITIONER'S EXHIBITS:- ------------------------------------- EXT.P1 - TRUE COPY OF THE OBJECTION FILED BY THE PETITIONER DATED 12.3.2007. EXT.P2 - TRUE COPY OF THE ORDER PASSED BY THE 1ST RESPONDENT DATED 20.3.2007. EXT.P3 - TRUE COPY OF THE NOTICE ISSUED BY THE 1ST RESPONDENT DATED 21.3.2007. EXT.P4 - TRUE COPY OF THE CIRCULAR NO.44/2006 DATED 27.11.2006. RESPONDENTS' EXHIBITS:- --------------------------------------- NIL. - true copy - K.Vinod Chandran, J. ---------------------------------------- W.P.(C).No.11090 of 2007-T ---------------------------------------- Dated this, the 19th day of November, 2011 JUDGMENT This writ petition is filed challenging the revision of compounded rate for the year 2006-2007 by an amendment to Section 7 of the Kerala General Sales Tax Act, 1963 (for short “KGST”Act) by Kerala Finance Act, 2006 dated 24.10.2006. 2. The petitioner is a bar attached hotel and had opted for the scheme of compounded tax under Section 7 at the start of the financial year 2006-2007. The petitioner challenges the amendments made to Section 7(a) and (b) of the KGST Act as having no retrospective effect and prays for a declaration that the petitioner may be permitted to pay compounded tax as per the unamended provisions. 3. However, at the time of hearing, the petitioner did not press the above prayers and sought for an alternative relief by way of quashing Exhibit P2 order of the assessing officer rejecting the petitioner's request for withdrawing from the option exercised. 4. I have heard the learned counsel appearing for the petitioner and the learned Government Pleader. WP(C).11090 of 2007 - 2 - 5. The counsel for the petitioner points out that similar issue for the very same assessment year were agitated by a group of persons similarly situated like the petitioner before this Court and a learned Single Judge of this Court had, in a batch of writ petitions (W.P.(C).No.8696 of 2007 and connected writ petitions) upheld the amendments and the retrospectivity of the same; but had allowed the petitioners to withdraw from the option exercised. The learned counsel for the petitioner also points out that the State had clearly averred in the counter affidavit in W.P.(C).No.8696 of 2007 that all the petitioners were given a chance to file fresh option in accordance with the amended provision. The learned Single Judge had also directed that the withdrawal of option, if exercised by the petitioners, has to be granted. 6. In the circumstances, I am of the opinion that Exhibit P2 has to be quashed and the first respondent should be directed to consider the prayer in ExhibitP1 objection afresh in accordance with the observations made above. The petitioner also prayed that the proceedings of the assessing officer as revealed by Exhibit P3 demanding recovery of tax and for showing cause as to why penalty should not be imposed also has to be set aside. Though Exhibit P3 is WP(C).11090 of 2007 - 3 - a notice, in view of the observations made by me above and in view of the specific directions issued by a learned Single Judge of this Court, I am of the view that no purpose would be served in pursuing with Exhibit P3 notice. In the circumstances, the writ petition is allowed and Exhibits P2 and P3 are set aside and the assessing officer is directed to consider the prayer for withdrawal of option exercised under Section 7 of the KGST Act in Exhibit P1, which is an objection to the notice issued by the officer proposing to reject the application seeking withdrawal of option. Sd/- K.Vinod Chandran, Judge. vku/-