VISION COMMUNICATIONS Vs. INTELLIGENCE OFFICER SQUAD NO IV

JUDGEMENT

(1.) THE petitioner is stated to be a registered dealer, but the Sales Tax Officer before whom the petitioner is registered is not made a party in the original petition. THE petitioner is challenging two orders issued under section 47 of the Kerala General Sales Tax Act, 1963 accepting composition of offence for which the petitioner would have otherwise faced prosecution. THE petitioner is not questioning the orders granting composition, but is questioning the composition fee collected by the department for both the years 1999-2000 and 2000-2001 at the rate of Its. 1 lakh each.

(2.) I heard counsel for the petitioner and the Government Pleader. While counsel for the petitioner submitted that the petitioner is engaged only in works contract, the tax liability is not determined in assessment and the first respondent has in the proceedings arbitrarily fixed the compounding fee at Rs. 1 lakh each against which the petitioner has no relief by way of appeal or revision. In the circumstances, the petitioner approached this Court for cancellation or at least reduction of compounding fee. The Government Pleader on the other hand submitted that the petitioner is not engaged in works contract and was engaged in sale of dish antenna parts and the same is admitted by the petitioner in the course of inspection in the petitioner's shop conducted on August 3, 2000. It is seen from the counter-affidavit that the petitioner made two separate applications on August 8, 2000 and September 4, 2000 agreeing to compound the offence for both the years admitting compounding fee at Rs. 1 lakh each. According to counsel for the petitioner, the assessment is not completed and the determination of tax in the course of compounding proceeding is not conclusive or binding on the petitioner. It is not known why assessment is not so far taken up and why tax was not collected along with compounding fee. Section 47 of the Act provides for collection of tax sought to be evaded and equal amount towards compounding fee subject to the maximum of Rs. 1 lakh during the relevant time which is now increased to Rs. 5 lakhs. Therefore, the short question is whether the demand of compounding fee without exactly determining the tax liability is justified or not. Of course in principle if tax sought to be evaded itself is found to be at or above the maximum compounding fee provided under the Act, then of course the maximum compounding fee can be recovered leaving assessment to be done by the assessing authority. In the counter-affidavit it is stated that the tax sought to be evaded by the petitioner was estimated at Rs. 2,03,028 for the year 1999-2000 and Rs. 96,450 for 2000-2001. According to the petitioner, the tax amount determined in the penalty proceeding is not correct. However, the details are furnished in the counter stating the date gathered on inspection and the admission by the petitioner.

(3.) THE original petition is disposed of as above. Order on C. M. P. No. 61216 of 2000 in O. P. No. 35916 of 2000 dismissed. Petition disposed of accordingly. .