ABDUL SATHAR M G Vs. STATE OF KERALA

JUDGEMENT

(1.) The connected revision case and the W. P. (C) are filed by a dealer engaged in the business of stationery and confectionery goods. After taking registration under the Kerala Value Added Tax Act, 2003 (hereinafter called, "the Act"), the petitioner started collecting and remitting tax during the year 2005-06. After completion of assessment, the assessing officer noticed that the petitioner has not taken permission under section 6(1A)(a) of the Act prior to collection of tax, which according to the officer, is the requirement of the said section in terms of rule 10A of the Kerala Value Added Tax Rules (hereinafter called, "the Rules") as the turnover was below Rs. 10 lakhs. For collecting and remitting tax by the petitioner who had turnover below Rs. 10 lakhs without permission under section 6(1A)(a) read with rule 10A of the Rules, the assessing officer forfeited the tax collection and levied penalty under section 67(2) of the Act for the alleged violation. In first appeal, the appellate authority, though cancelled penalty levied under section 67(2), left freedom to the officer to consider penalty under section 72 of the Act, against which the Department filed an appeal and the assessee filed a cross objection which were disposed of by the Tribunal by the order impugned in the O. T. Revision filed by the assessee under section 63 of the Act. The connected W. P. is filed by the assessee for a declaration that form IF prescribed is ultra vires and beyond the powers of the respondents under rule 10A of the Rules and is applicable only for the purpose of section 6(1A)(b) of the Act. We have heard counsel appearing for the petitioner and the Government Pleader Sri Mohammed Rafiq appearing for the respondent.

(2.) The main question to be considered is whether the petitioner which is a registered dealer with turnover below Rs.10 lakhs is entitled to collect tax without obtaining a prior permission in terms of rule 10A of the Rules. According to the petitioner, rule 10A and form IF prescribed thereunder apply to only dealers who are covered by section 6(1A)(b) of the Act and not a dealer registered under the Act with turnover less than Rs. 10 lakhs otherwise not liable to pay tax. For easy reference, we extract hereunder the relevant provisions of the Act and the Rules :

(3.) The only question is whether form IF prescribed under rule 10A and rule 10A as such are applicable to a registered dealer for collection and payment of tax, if the turnover of such dealer is below the non-taxable limit of Rs.10 lakhs. While the contention of the petitioner is that dealers like petitioner who have registration are entitled to collect tax and remit the same without any prior permission under rule 10A, the contention of the Government Pleader is that both dealers with turnover below the nontaxable limit of Rs.10 lakhs falling under sub-clause (a) and dealers in whose hands sale of any goods are exempted, covered by sub-clause (b) of section 6(1A), should obtain advance permission from the officer under rule 10A by filing form IF prescribed under the said rule.