IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HON'BLE THE ACTING CHIEF JUSTICE MR.C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE P.S.GOPINATHAN MONDAY, THE 24TH OCTOBER 2011 / 2ND KARTHIKA 1933 OT.Rev.No. 63 of 2011() ----------------------- TA(VAT).654/2010 of KERALA VAT APPELLATE TRIBUNAL, ERNAKULAM .................... REVISION PETITIONER/APPELLANT/ASSESSEE ---------------------------------------------------------- M/S.KALLYAN JEWELLERS KOLLAM & ERODE, ZAIN TOWER, BEACH ROAD, KOLLAM, REPRESENTED BY ITS MANAGING PARTNER, SRI.T.S.KALYANARAMAN. BY ADV. SMT.S.K.DEVI SRI.M.RAJ MOHAN SRI.SANTHOSH P.ABRAHAM SRI.SHANMUGHAM D.JAYAN RESPONDENT: RESPONDENT/REVENUE --------------------------------- STATE OF KERALA, REPRESENTED BY ITS FINANCE SECRETARY, SECRETARIAT, THIRUVANANTHAPURAM. SPL. GOVT. PLEADER SRI. BOBY JOHN. THIS OTHER TAX REVISION (VAT) HAVING COME UP FOR ADMISSION ON 24/10/2011, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: O.T. REV. 63/2011 APPENDIX ANNEXURE-1 TRUE COPY OF THE PENALTY ORDER NO. CR-14/08-09 DATED 21.10.2009 ANNEXURE-II TRUE COPY OF THE FIRST APPELLATE ORDER NO. KVAT 611/10 DATED 30.9.2010. ANNEXURE III TRUE COPY OF THE TRIBUNAL ORDER TA (VAT) NO. 654/2010 DATED 21.1.2011. RESPONDENTS' EXHIBITS: NIL. // TRUE COPY // P.S. TO JUDGE. KNC/- C.N. RAMACHANDRAN NAIR, Ag. C.J. & P.S. GOPINATHAN, J. = = = = = = = = = = = = = = = = = = O.T. REV. NO. 63 OF 2011 = = = = = = = = = = = = = = = = = = DATED THIS, THE 24TH DAY OF OCTOBER, 2011. J U D G M E N T C.N. Ramachandran Nair, J. Heard counsel for the petitioner and the Government Pleader for the respondent. 2. Challenge is against the order of the Tribunal modifying penalty levied under Section 67(1) of the KVAT Act for holding unaccounted stock and for making unaccounted sales by the petitioner, which is a jewelery. It is seen that an inspection was carried out in the shop of the petitioner on 17.1.2009 wherein it was noticed that appellant has suppressed stock of Rs.8,49,15,850/- with tax effect at Rs. 24,49,789/-. The unaccounted stock is estimated only by physical verification of items weighing above 40 gms. (223 in numbers) and low weight items were not weighed or checked by the Department. Probably, the Department avoided verification because it is a laborious job of counting and weighing small weight gold ornaments. Though penalty was levied at double the amount of tax on the suppressed turnover, the Tribunal reduced it to tax amount which means that penalty levied is nothing but tax on the unaccounted stocks. O.T. (REV.) 63/2011 2 3. After hearing both sides, what we notice is that stock register in the gold shop in Form 14A under Rule 58(13) was not maintained by the petitioner. Verification is made only in respect of high weight items, which is certainly to the advantage of the petitioner. Further, Tribunal has shown a very liberal approach by reducing the penalty to tax amount. It is against this order of he Tribunal, petitioner has come up in revision before us. We do not find any substantial question of law arising from the order of the Tribunal. Consequently, the revision is dismissed. C.N. RAMACHANDRAN NAIR, (Ag. CHIEF JUSTICE P.S. GOPINATHAN, (JUDGE) KNC/-