IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 25TH NOVEMBER 2010 / 4TH AGRAHAYANA 1932 WP(C).No. 34534 of 2010(N) ----------------------------------------- PETITIONER(S): ------------------------ THE KONCHERRY COIR FACTORIES, MAYITHARA P.O., ALAPPUZHA DISTRICT, REPRESENTED BY ITS MANAGING PARTNER K.S.SUBHASH. BY ADV. SRI.V.P.SUKUMAR RESPONDENT(S): ---------------------------- THE COMMERCIAL TAX OFFICER-II, COMMERCIAL TAX OFFICE, CHERTHALA-688 524. BY SR. GOVERNMENT PLEADER SRI. C.K.GOVINDAN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 25/11/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.34534 of 2010 ------------------------------------------- Dated this the 25th day of November, 2010 J U D G M E N T ---------------------- The petitioner is aggrieved by Ext.P6 and P7 orders of assessments completed under Section 17D of the Kerala General Sales Tax Act (KGST Act), with respect to the years 2003-04 and 2004-05. The orders in question are impugned without filing statutory appeals on the ground that the assessments were completed without affording the petitioner any reasonable opportunity for production of books of accounts and for objecting to the proposal. 2. According to the petitioner, the business premises of the petitioner remained closed since the bank from where the petitioner had availed financial assistance had locked the factory premises and kept the same under their lock and key, pursuant to proceedings initiated on the basis of default committed in repayment W.P.(C).34534/10-N -2- of amounts due. It is stated that the assessments were finalised imposing the huge liability on the petitioner which is not actually due in view of the trading account produced as Ext.P1 and P2, which reveals that the petitioner was doing only export sales, mainly of coir products. It is stated that no notice intimating the proposal for finalisation of the assessments were served on the petitioner. It is also stated that copies of Ext.P6 and P7 orders of assessments were also not served. When the petitioner received Ext.P5 arrear notice through registered post, he approached the assessing authority and then only he came to know that the assessments were finalised. Under such circumstances the petitioner seeks to quash Ext.P6 and P7 orders issued in violation of the mandatory procedure contemplated under the statute and also in violation of the principles of natural justice. 3. On a perusal of Ext.P6 and P7 it is revealed that the petitioner had failed to produce Books of Accounts inspite of various notices issued and hence the assessment W.P.(C).34534/10-N -3- was proposed to be finalised under Section 17D. It is mentioned that a proposal notice in this regard was served on the petitioner by way of affixure at the place of business of the petitioner, on 10.6.2010. Since the petitioner has not responded to such notice the assessment was completed by the Fast Track Team. 4. Learned counsel for the petitioner points out that as per provisions contained in Rule 63 of the KGST Rules, affixure can be effected only as a last resort, if the authority fails to serve notice on the assessee by way of other methods prescribed therein, including sending of notice by registered post to the address of the assessee available with the authority. It is contended that the allegation regarding affixure is false and the authority concerned had never made any genuine attempt to serve notice on the petitioner, even after knowing well that the business premises is remaining closed. It is also stated that the authority concerned had not attempted to serve notice on any of the partners of the petitioner firm who are residing in the very W.P.(C).34534/10-N -4- same locality. 5. Considering the facts and circumstances I am of the view that the assessment under Section 17D was finalised by the Fast Track Team without affording adequate opportunity to the petitioner to represent their case. It is evident that the proposal notice was served only through affixures. In spite of the fact that the petitioner has not filed any objection to the proposal, the Fast Track Team has not attempted to issue fresh notice or to attempt service of any notice either calling for objection or calling the petitioner for personal hearing through any of the methods contemplated under Rule 63 of the KVAT Rules. Hence I am of the considered opinion that the impugned assessments are finalised in violation of principles of natural justice. 5. Under the above circumstances the writ petition is allowed and Ext.P6 & P7 are hereby quashed. The respondent herein or the Fast Track Team, as the case may be, is directed to finalise the assessment afresh either under Section 17(3) or under Section 17D of the KGST Act on W.P.(C).34534/10-N -5- issuing fresh notice and after affording proper opportunity to the petitioner for filing objections to the proposal notice and for production of Books of Accounts and documents in support of their claim. 6. Needless to say that assessment shall be finalised after affording an opportunity of hearing and after filing such objections. Fresh decision in this regard shall be taken as early as possible, at any rate, within a period of three months from the date of receipt of a copy of this judgment. C.K.ABDUL REHIM, JUDGE. okb