M/S.Sitics Logistics Solutions (P) Ltd vs The Commercial Tax Officer
2024 Latest Caselaw 27077 Ker

Kerala High Court

M/S.Sitics Logistics Solutions (P) Ltd vs The Commercial Tax Officer on 6 September, 2024

                                                  2024:KER:68257
           IN THE HIGH COURT OF KERALA AT ERNAKULAM

                             PRESENT

            THE HONOURABLE MR.JUSTICE BASANT BALAJI


   FRIDAY, THE 6TH DAY OF SEPTEMBER 2024 / 15TH BHADRA, 1946


                      WP(C) NO. 25609 OF 2016


PETITIONER/S:

           M/S.SITICS LOGISTICS SOLUTIONS (P) LTD,
           18/386-5, ENGLISH CHURCH ROAD - 18, PALAKKAD,
           REPRESENTED BY ITS MANAGING DIRECTOR, A.M.SIKANDER



           BY ADV MEERA V.MENON


RESPONDENT/S:

     1     THE COMMERCIAL TAX OFFICER,
           2ND CIRCLE, PALAKKAD - 678 001.

     2     STATE OF KERALA,
           REPRESENTED BY THE SECRETARY, TAXES DEPARTMENT,
           GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM



           BY ADV GOVERNMENT PLEADER
OTHER PRESENT:


           GP SRI. SAYED M. THANGAL


     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
06.09.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
                                                                    2024:KER:68257
WP(C) NO. 25609 OF 2016

                                         -2-




                                    JUDGMENT

(Dated this the 6th day of September 2024)

The petitioner is an assessee under the Kerala Value Added

Tax Act, 2003, engaged in trading branded food products. For the

year 2013-14, returns were filed, and thereafter, the 1 st respondent

issued a notice under Section 25(1) proposing to make additions to

the allegation that the petitioner carried out unaccounted

purchases from outside the State, as revealed from the details

available from the Bangra-Manjeswaram check post. The allegation

is that the petitioner effected unaccounted purchases from

M/s.Abbott Healthcare (P) Ltd., on two occasions, for Rs.51.54

lakhs and 105.52 lakhs. The petitioner pointed out that the first

transaction is accounted for along with the return for August 2013.

With respect to the second transaction, the petitioner pointed out

that the same was neither received nor ordered by it. Therefore,

the petitioner obtained Ext.P3 certificate dated 05.03.2015 from 2024:KER:68257 WP(C) NO. 25609 OF 2016

M/s.Abbott Healthcare (P) Ltd. They have stated that they have

never raised such an invoice with respect to the petitioner.

2. The 1st respondent passed Ext.P4 order dated

27.05.2016, refusing to accept the explanations based on Ext.P3

and demanding Rs.42,41,271/- including interest. The Assessing

Authority did not accept the certificate produced, and it is

suspected that the petitioner made an unaccounted purchase in the

name of M/s.Abbott Healthcare (P) Ltd.

3. The petitioner contends that the check post entry alone

cannot be a reason for the assessment, especially when the

consignor has specifically pointed out that they never raised such

an invoice. Hence, the petitioner approached this Court for

quashing Ext.P4 assessment order.

4. A counter affidavit is filed on behalf of the 1 st

respondent, and a check post entry for the transaction is produced

as Ext.R1(a). In the counter affidavit, it is contended that for the 2024:KER:68257 WP(C) NO. 25609 OF 2016

assessment year 2013-14, the petitioner filed a return disclosing

export sales for Rs.3,22,54,502/-. However, on further scrutiny of

KVATIS, it was found that the petitioner had not accounted for

the invoice for Rs.157.06 lakhs. Hence, notice under Section 25(1)

of the KVAT Act was issued for making the best judgment

assessment. The petitioner filed a reply, contending that the check

post authority recorded the transactions twice on two different

dates as the same invoice had been carried out as a part of the

transit document on both occasions. On verification of the

KVATIS, it was found that it was duplicated. The petitioner's

contention is genuine, and the first interstate transaction was

deleted. The second contention was rejected on the ground that

the explanation offered by the petitioner was not acceptable. The

denial of a transaction without any documents is only an attempt

to escape the assessment and the penalty proceedings.

5. The petitioner filed a reply affidavit to the counter 2024:KER:68257 WP(C) NO. 25609 OF 2016

affidavit filed by the 1st respondent and produced Exts.P5 to P7.

Ext.P5 is a copy of the stock transfer, and Ext.P7 is a copy of the

return filed by a dealer named Gokaram Enterprises. Exts.P5 to P7

were never produced before the Assessing Authority. For that

reason, Ext.P4 was issued.

Since the petitioner produced Exts.P5 to P7 before this Court

as additional documents, I deem it appropriate to quash Ext.P4

directing reconsideration. In the result, Ext.P4 is quashed, and the

1st respondent is directed to reconsider the petitioner's case, taking

into consideration Ext P5 to P7 and pass appropriate orders within

a period of two months from the date of receipt of a copy of this

judgment.

The writ petition is allowed as above.

Sd/-

BASANT BALAJI JUDGE

JS 2024:KER:68257 WP(C) NO. 25609 OF 2016

APPENDIX OF WP(C) 25609/2016

PETITIONER EXHIBITS

EXHIBIT P1. COPY OF NOTICE ISSUED BY THE 1ST RESPONDENT DATED 11.05.2016.

EXHIBIT P2. COPY OF LETTER SUBMITTED BY THE PETITIONER BEFORE THE 1ST RESPONDENT DATED 23.05.2016.

EXHIBIT P3. COPY OF LETTER ISSUED BY M/S.ABBOTT HEALHCARE PVT.LTD., MUBAI DATED 05.03.2015.

EXHIBIT P4. COPY OF ORDER ISSUED BY THE 1ST RESPONDENT DATED 27.05.2016.