IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE THE CHIEF JUSTICE MR.H.L.DATTU & THE HONOURABLE MR. JUSTICE A.K.BASHEER TUESDAY, THE 29TH JULY 2008 / 7TH SRAVANA 1930 S.T.Rev..No. 529 of 2004 ----------------------------------------- ORDER DATED 28.5.2002 IN TA.2/1994 OF THE KERALA SALES TAX APPELLATE TRIBUNAL, ADDITIONAL BENCH-II, ERNAKULAM .................... REVISION PETITIONER/APPELLANT/REVENUE: ------------------------------------------------------------------ STATE OF KERALA, REPRESENTED BY THE DEPUTY COMMISSIONER (LAW), COMMERCIAL TAXES, ERNAKULAM. BY SPECIAL GOVERNMENT PLEADER SRI.VINOD CHANDRAN RESPONDENT/RESPONDENT/ASSESSEE: ------------------------------------------------------------ M/S.REJINI ICE & COLD STORAGE, PALLURUTHY, CHCOHN-6. BY ADV. SRI.ARIKKAT VIJAYAN MENON SRI.HARISANKAR V. MENON SMT.MEERA V.MENON THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 29/07/2008, ALONG WITH STRV NO.25 OF 2005 & STRV NO.26 OF 2005 THE COURT ON THE SAME DAY PASSED THE FOLLOWING: H.L.DATTU, C.J. & A.K.BASHEER, J. ------------------------------------------- S.T.Rev.No.529 of 2004, S.T.Rev.No.25 of 2005 & S.T.Rev.No.26 of 2005 ------------------------------------------ Dated, this the 29th day of July, 2008 ORDER H.L.Dattu, C.J. These revision petitions pertain to the assessment years 1979-80, 1980-81 and 1981-82. 2. Since the assessee is common in these revision petitions and since the legal issues involved are also identical, these revision petitions are clubbed, heard and disposed of by this common order. 3. The Revenue calls in question the correctness or otherwise of the orders passed by the Kerala Sales Tax Appellate Tribunal, Additional Bench-II, Ernakulam in T.A.Nos.2/1994, 3/1994 and 4/1994 dated 28th May, 2002. 4. The Tribunal while allowing the assessee's appeal had followed its earlier Full Bench decision in the case of M/s.Sea Rose Marine Pvt. Ltd. v. State of Kerala in T.A.Nos.317 and 318 of 1995 dated 21.11.1995. 5. The State being aggrieved by the Full Bench decision of the Tribunal in M/s.Sea Rose Marine Pvt. Ltd. case, on which reliance is placed by the Tribunal in allowing the assessee's appeal, had approached this Court in T.R.C.Nos.34 and 36 of 1997. S.T.Rev.No.529 of 2004, etc. 2 6. A Division Bench of this Court by its orders dated 4th September, 2003 has disposed of the said revision petitions and in that has remanded the matter to the assessing authority for reconsideration of the entire issues in the light of certain observations made by the apex Court in the case of K.Gopinathan Nair v. State of Kerala, (1997) 105 STC 580 and C.T. Ltd. and another v. Commercial Tax Officer & others, (1997) 104 STC 94. 7. The learned Judges in the aforesaid decision at paragraphs 11, 12 and 13 have observed as under: “11. The scope of the provisions of sections 2(ab), 5 (2) and (3) of the C.S.T. Act was considered in relation to the assessment under the K.G.S.T. Act by the Supreme Court in K.Gopinathan Nair v. State of Kerala (1997) 105 STC 580. Similarly, the scope of the provisions of Sec.5(3) of the C.S.T. Act was considered by the Supreme Court in C.T.Ltd. and another v. Commercial Tax Officer & others (1997) 104 STC 94. Though the first decision mentioned supra was rendered in the context of Section 5(2) which deals with 'sale or purchase in the course of import' it has got a bearing on the interpretation of Section 5(1) which deals with 'sale/purchase in the course of export'. The second decision directly deals with exemption under section 5(3) of the C.S.T.Act. We find that the principles laid down in these two decisions have got a strong bearing on the issue involved in the present case. We note that the S.T.Rev.No.529 of 2004, etc. 3 Tribunal has taken the view that the transaction in question falls within Section 5(1) of the C.S.T.Act without considering the legal principles laid down by this court and the Supreme Court. Of course the two decisions which we have referred were not available at the time when the Tribunal decided the question. We also note that the Tribunal has taken the view that since the transaction falls within Section 5(1) the case will fall under section 5(3) also. 12. Regarding the conditions to be fulfilled under Section 5(3) of the C.S.T.Act the Tribunal has simply stated that the assessing authority had no case that the conditions of section 5(3) have not been fulfilled. According to us, these approaches made by the Tribunal cannot be sustained. We note that the first appellate authority has remitted the matter to the assessing authority to consider the question as to whether the assessee had satisfied the requirements of Sec.5(3) of the C.S.T.Act. 13. In these circumstances we are of the view that the claim of the assessee for exemption under section 5(3) of the C.S.T.Act in respect of the purchase turnover of prawns effected locally has to be considered by the assessing authority as directed by the first appellate authority in accordance with law and in the light of the two decisions of the Supreme Court mentioned above. We accordingly set aside the order of the Tribunal and remit S.T.Rev.No.529 of 2004, etc. 4 the matter to the assessing authority for de novo consideration of the claim of the assessee made under section 5(3) of the Act, as mentioned above. While considering the matter certainly it is open to the assessee to place any other decisions of the Supreme Court in the matter.” 8. Since the Tribunal has allowed the assessee's appeal primarily relying upon the decision of the Full Bench of the Tribunal in M/s. Sea Rose Marine Pvt. Ltd. case in T.A.Nos.317 and 318 of 1995 and that decision has now been set aside by a Division Bench of this Court in T.R.C.Nos.34 and 36 of 1997 and since the matter is remanded to the assessing authority to re-do the matter in accordance with law, in our opinion, these revision petitions also should be disposed of by remanding the matter to the assessing authority to re-do the matter in accordance with law in the light of the observations made by a Division Bench of this Court in the case of Dy. Commissioner (Law) Ernakulam v. M/s. Sea Rose Marine Pvt. Limited in T.R.C.Nos.34 and 36 of 1997. 9. Accordingly, we pass the following: ORDER i) Revision petitions are disposed of. ii) The order passed by the Tribunal in T.A.Nos.2/1994, 3/1994 and 4/1994 dated 28.5.2002 is set aside. S.T.Rev.No.529 of 2004, etc. 5 iii) The matter is now remanded back to the assessing authority to re-do the same in accordance with law and in the light of the observations made by the Division Bench of this Court in the case of Deputy Commissioner (Law) Ernakulam v. M/s. Sea Rose Marine Pvt. Ltd in T.R.C.Nos.34 and 36 of 1997 as expeditiously as possible, at any rate within two months from the date of receipt of a copy of this Court's order. iv) All the contentions of both parties are left open. Ordered accordingly. (H.L.DATTU) CHIEF JUSTICE (A.K.BASHEER) JUDGE vns