IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM MONDAY, THE 14TH MARCH 2011 / 23RD PHALGUNA 1932 WP(C).No. 3171 of 2011(V) ------------------------- PETITIONER(S): --------------- N.MOIDEEN KUTTY, S/O.HAMZA, NEELIYIL HOUSE, BIG BAZAR, PERINTHALMANNA, PARTNER, M/S.ELAPPULLY ESSENTIAL OIL INDUSTRIES, ELAPPULLY, PALAKKAD. BY ADV. SRI.R.SUDHAKARA MENON RESPONDENT(S): --------------- 1. STATE OF KERALA, REP. BY SECRETAY, FINANCE DEPARTMENT, GOVT. SECRETARIAT, THIRUVANANTHAPURAM-695 001. 2. THE COMMERCIAL TAX OFFICER, COMMERCIAL TAX OFFICE II CIRCLE, COMMERCIAL TAX COMPLEX, PALAKKAD, PIN-678 001. 3. DEPUTY COMMISSIONER, COMMERCIAL TAXES, COMMERCIAL TAX COMPLEX, PALAKKAD, PIN-678 001. BY GOVERNMENT PLEADER SRI.C.K.GOVINDAN FOR R2 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 14/03/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.K.ABDUL REHIM, J --------------------------------------- W.P(C) No.3171 of 2011-V ---------------------------------------- Dated this the 14th day of March, 2011. J U D G M E N T Exts.P1 and P2 orders of assessment completed against the petitioner, with respect to the years 2003-04 and 2004-05, are challenged in this writ petition. The assessments were completed on a best judgment basis, pursuant to inspections conducted by authorities of the Forest Department at the premise of the petitioner on different dates like 14.8.2004, 10.10.2004 and 12.10.2004. The assessing authority had initiated the proceedings on the basis of a report received from the authorities of the Forest Department. The allegation is that, the petitioner was engaged in clandestine production and sale of sandal wood oil, without accounting. It was also alleged that the sandal wood chips and sandal wood dust were procured through unaccounted purchase. 2. Considering the effective remedy of statutory appeal provided, it is not justified on the part of this Court W.P(C) No.3171 of 2011-V 2 to look into merits of the contentions raised against the orders of assessment. The petitioner is challenging the impugned assessment without filing appeal, mainly on the premise that the assessments were finalised without affording proper opportunity of hearing. Contention of the petitioner is that when the proposal notices were received, he had filed Exts.P3 and P4 objections. In Ext.P3, the petitioner had specifically pointed out that, 'C' Forms declarations mentioned therein were actually lost and steps were already taken through Ext.P4 for notifying the loss and for invalidating the same. Time for submitting objection was requested on the premise that the partners of the firm were not available and the reply could not be finalised after discussion among the partners. It is the allegation of the petitioner that, the matter was posted for hearing before the assessing authority on 27.12.2010 and on that date the petitioner requested for adjournment. It is further stated that eventhough the matter was posted on 30.12.2010 the notice regarding such posting was received by the W.P(C) No.3171 of 2011-V 3 petitioner only on 29.12.2010. It is further alleged that, eventhough request for further adjournment was made it was not considered, since the assessment was finalised. It was also contended that the impugned assessments are unsustainable since it was finalised in violation of the mandatory procedure contemplated under the relevant provisions and also in violation of principles of natural justice. 3. In a statement filed on behalf of the 2nd respondent, it is mentioned that the proposals were communicated in the address of the firm. But the same were returned unserved with postal endorsement as “Door locked”. But the notice sent to the partners were duly served. It is further stated that in response to the notice Sri.M.K.Salim, one of the partners, had filed reply on 27.12.2010, seeking two months time to verify the mahazar and other records pertaining to the inspection conducted by the Forest Department. Eventhough such a request was not valid, the dealer was given one more opportunity to file W.P(C) No.3171 of 2011-V 4 objections against the proposal on 30.12.2010. But the dealer had failed to avail any such opportunity and therefore the assessment was completed. 4. The petitioner also raises a contention that in view of Ext.P5 circular issued by the Commissioner of Commercial Taxes, the authority ought to have completed the assessment by recourse to procedure contemplated under Section 17D, instead of the procedure adopted under Section 17(3) of the Kerala General Sales Tax Act. But I do not find any merit in such a contention, because it is not mandatory that all pending assessments should be finalised under Section 17D itself. There is no legal impediment in the assessing authority finalising the assessment by recourse to the normal procedure as contemplated under Section 17(3). 5. Regarding the opportunity for hearing, eventhough I am not fully impressed on the contentions raised, especially in view of the averments contained in the statement filed on behalf of the 2nd respondent, I take notice W.P(C) No.3171 of 2011-V 5 of the fact that the petitioner had subsequently produced Ext.P8 Gazette notification to the effect of publishing notice regarding loss and cancellation of 'C' Form declarations, which pertains to the assessment year 2003-04. I am of the view that interest of justice will be served if the assessing authority is directed to finalise the matter afresh after affording an opportunity of hearing to the petitioner and after considering Ext.P8 notification issued regarding loss of 'C' Form declaration. 6. Therefore, Exts.P1 and P2 orders are hereby quashed. The 2nd respondent is directed to reconsider the matter on the basis of objections if any, to be filed by the petitioner and on the basis of Ext.P8 notification. Fresh orders of assessment shall be issued after affording affording opportunity of hearing to the petitioner and also an opportunity for producing documents and books of accounts in support of his contentions. 7. Fresh orders of assessment in this regard shall be issued as early as possible, at any rate within a period of W.P(C) No.3171 of 2011-V 6 one month from the date of receipt of a copy of this judgment. Additional objections if any to be filed by the petitioner within two weeks from today. C.K.ABDUL REHIM JUDGE ab