IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM THURSDAY, THE 14TH OCTOBER 2010 / 22ND ASWINA 1932 WP(C).No. 31158 of 2010(T) --------------------------------------- PETITIONER: ------------------- MS. EXCEL TIMBERS PVT.LTD. PETTA, FEROKE, CALICUT, BY MANAGING DIRECTOR V.MAMMU. BY ADV. SRI.P.RAGHUNATH. RESPONDENTS: ------------------------ 1. THE INTELLIGENCE OFFICER, SQUAD NO.I, COMMERCIAL TAXES,KASARGODE. 2. COMMISSIONER OF COM.TAXES, THIRUVANANTHAPURAM. R1 & R2 BY SR. GOVT. PLEADER SRI. C.K. GOVINDAN. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 14/10/2010,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: prv. C.K.ABDUL REHIM, J. ------------------------------------------- W.P.(C).No.31158 of 2010 ------------------------------------------- Dated this the 14th day of October, 2010 J U D G M E N T ---------------------- This writ petition is filed challenging the detention of Timber transported from Mangalore. In Ext.P4 notice, which is issued under Section 47(2) of the Kerala Value Added Tax Act, 2003 (KVAT Act) the reason for detention mentioned is that, the goods under transport was not accompanied with departmental Delivery Note and it was not declared at the check posts enroute. According to the petitioner, the goods in question was imported at the coastal port of Mangalore and it was transported to the place of business of the petitioner at Feroke, accompanied with Ext.P1 Delivery Note, and Advance Tax was paid at the border Check Post at Manjeswar, as evidenced from Ext.P2. It is stated that the petitioner had effected sale in transit to a dealer at Kasargode, by virtue of Ext.P3 invoice after collecting tax at the rate of 12.5%. The transport was intercepted while the goods were unloaded at Kasargode, at W.P.(C).31158/10-T -2- the place of business of the purchaser. Under the above circumstances there was no occasion for the goods being brought to Feroke and there was no occasion of the goods passing through the Check Posts at Mahe and Kunhipally, is the contention. 2. Learned Government Pleader, per contra, contended that there was no departmental Delivery Note accompanied with the transport at the time when it was intercepted and only Ext.P3 invoice was available. If it was a sale in transit as claimed by the petitioner, the same ought to have been endorsed in the original document under which it was transported from Mangalore. It was also pointed out that, the price declared in Ext.P3 is not tallying with the price as mentioned in Ext.P1 and the Advance Tax paid under Ext.P2 was added together. Under such circumstances suspicion raised with respect to the attempt in evasion of payment of tax is reasonable and the petitioner need to furnish security deposit, is the contention. 3. However, the questions as to whether the transport was genuine and as to whether there was any attempt in evasion of payment of tax, are matters which need be decided on finalisation of the adjudication contemplated under Section 47. W.P.(C).31158/10-T -3- It is pertinent to note that the petitioner had already remitted Advance Tax with respect to import of the goods and that he is a registered dealer regularly paying tax. I am of the opinion that the goods need not be detained pending finalisaion of the enquiry. 4. Therefore, the 1st respondent is directed to release the goods detained under Ext.P4, along with the vehicle, on the petitioner furnishing Security Bond in the form prescribed under the KVAT Rules, without sureties, for the amount demanded thereunder. 5. The competent authority under Section 47 is directed to finalise the enquiry as expeditiously as possible, after affording an opportunity of hearing to the petitioner, at any rate within a period of (6) six weeks from the date of release of the goods. C.K.ABDUL REHIM, JUDGE. okb