GEORGE KOCHUPARAMBIL Vs. COMMERCIAL TAX OFFICER

JUDGEMENT

(1.) PETITIONER is a dealer registered under the KVAT Act, who owns a metal crusher unit. He has opted for payment of tax under the Compounded Scheme as provided under section 8(b) of the Act. Ext.P1(a) is the proceedings of the 1st respondent according permission in this behalf and Ext.P1 is the permission in Form No IE issued by the 1st respondent on 29/6/11. Accordingly tax was being paid by the petitioner for the three secondary machines and one primary machine that were installed in his unit.

(2.) ACCORDING to the petitioner, during the 3rd quarter of 2011-12, on 01/10/2011, replacing 3 old secondary machines, a modern cone machinery attracting higher tax liability was installed in his unit. By Ext.P2, the installation and replacement of the machineries was intimated to the 1st respondent with a request to revise the tax liability as provided under Rule 11(7) of the KVAT Rules. Complaint of the petitioner is that instead of revising the tax liability for the period subsequent to the installation of the new cone machinery, the 1st respondent issued Exts.P3 and P3(a), a fresh permission in Form 1E and proceedings.

(3.) ON the other hand, based on the instructions obtained, the learned Government Pleader contended that compounding is optional and that permission for payment of tax at compounded rates is allowed on an annual basis accepting the option exercised by the dealer. According to her, once option is accepted and permission is granted, the dealer cannot opt out of the scheme or seek any modification of the liability under the scheme. It was also argued that once the details of the additional machinery installed are furnished as provided under Rule 11(7) of the KVAT Rules, the Assessing Authority is bound to revise the permission granted. Further, according to her, when revision is effected on the installation of additional machinery, what is revised is the permission granted and that such revision of the permission already granted can only be for the whole year and not with effect from the date of installation of the additional machinery. It was also contended that as per Rule 11(7), revision is permitted only on installation of additional machinery, and therefore, even if any existing machinery is replaced during the year, the dealer is not relieved of the liability to pay tax for the replaced machinery. Therefore, the learned Government Pleader argued that the writ petition is without any merit and prayed for its dismissal.