ALUKKAS JEWELLERY Vs. STATE OF KERALA REP

JUDGEMENT

(1.) Original Petition No. 15583 of 2002 was preferred seeking a declaration that the first proviso to Section 7(1)(a) of the Kerala General Sales Tax Act, 1963 is not applicable to the petitioner's case in the matter of fixation of compounding fee for the year 2000-01 and also to quash exhibit P-3 order determining the compounded tax payable for the year 2000-01 at Rs. 85,13,749.

(2.) Section 7(1)(a) of the Kerala General Sales Tax Act, 1963 provides for payment of tax at compounded rates for dealers in gold or silver ornaments or wares, at their option instead of paying tax in accordance with the provisions of the said section. For the assessment year 2000-01 as per Section 7(1)(a) as it stood at the relevant assessment year, compounded rate of tax payable by any dealer in gold was 120 per cent of the tax payable by him as conceded in the return or accounts for the immediate preceding year. It also provides that where any such dealer opens new branches, the compounded tax payable by him in respect of each new branch for the first year shall be twenty-five per cent of the compounded tax for the principal place of business.

(3.) The assessee had opened a new branch of business at Perintalmanna on September 1, 1999. The total tax admitted by the assessee for the year 1999-2000 respectively in the head office and branch office was Rs. 49,95,438 and Rs. 9,06,318, total of which would come to Rs. 59,01,756. The assessee had paid a sum of Rs. 59,06,459 and collected tax. The assessee is eligible to opt for payment of tax at compounded rate under Section 7(1)(a) of the Act and hence applied for permission to pay tax at the compounded rate for the year 2000-01. Based on the total tax paid by the assessee for the year 1999-2000, compounded tax payable by the assessee for the year 2000-01 in terms of Section 7(1)(a) is 120 per cent of Rs. 59,06,456, i.e., Rs. 70,87,151.