ANTONY GEORGE Vs. SALES TAX OFFICER

JUDGEMENT

(1.) The correctness and the sustainability of the proceedings taken by the respondents in realising the sales tax at two different stages, that is at the first point of sale and the last point of sale, as provided under the Fifth Schedule to the Kerala General Sales Tax Act in respect of the commodity (rubber) when the maximum rate to be fully satisfied at the first stage itself, if the said sale is to an unregistered dealer, is the point involved. The case of the petitioner is that he purchased rubber from the third respondent in the year 1996-97 for a total sale consideration of Rs. 21,76,000. He had deposited a total sum of Rs. 27,56,190 which was inclusive of the stipulated income-tax, sales tax, surcharge and such other charges. It is the case of the petitioner that he suffered a huge loss and had to sell the commodity for a lesser price. It is also admitted that the petitioner was not a registered dealer at the time of transaction and as such, by virtue of the mandate under the statute, he was made to pay the total tax payable at the two different stages, i.e., 10 per cent at the first point and two per cent at the last point, thus effecting the tax payment to the tune of 12 per cent as certified by the third respondent by exhibit P1/P1(a).

(2.) In the course of the proceedings, on coming across certain discrepancies with regard to the transaction and accounts, the concerned authority imposed a penalty to the tune of Rs. 1,65,370 being double the amount of tax evaded in respect of the transaction and a further penalty of Rs. 10,000 for not taking registration under the KGST Act, obviously for the reason that the admitted sale consideration was more than Rs. 2,00,000, for which registration was a must. However, on filing revision petition, the said order was set aside by the concerned authority as borne by exhibit P2. Later, the assessment was finalised by the concerned authority as per exhibit P3, imposing a tax liability to tune of Rs. 82,686. The petitioner approached this court challenging the same, by filing W. P.(Q No. 18152 of 2003, which was disposed of relegating the petitioner to avail of the statutory remedy. It was accordingly, that an appeal was preferred and the appellate authority, after considering the plus and minus points modified the exhibit P3 assessment by passing exhibit P4 order. As per exhibit P4, the assessing authority was directed to accept the books of accounts maintained by the petitioner, however sustaining the finding and reasoning in respect of the tax levied at the second point of sale, as assessed by the assessing authority. The fact remains that exhibit P4 passed by the appellate authority has not been subjected to challenge by the petitioner.

(3.) While so, the petitioner was served with exhibit P5 proceedings recomputing the actual tax liability, pursuant to exhibit P4 order passed by the appellate authority. As per the said proceedings, a total sum of Rs. 4,351 was shown as the balance tax payable at the rate of two per cent, with 10 per cent surcharge, i.e., Rs. 435 and thus for a total sum of Rs. 4,786. According to the petitioner, since the said amount was only a meagre one, he did not propose to have it challenged. But the said proceeding was sought to be revised by exhibit P6 notice issued under section 45 of the KGST Act, whereby it was pointed out that the books of accounts actually revealed the admitted sale consideration of Rs. 21,76,000 and it was sold for a sale consideration of Rs. 21,75,753. As such, the taxable turnover was to be reckoned as Rs. 21,75,753 instead of Rs. 2,17,555 as per the books of accounts.