AYODHYA JEWLLERS Vs. INTELLIGENCE OFFICER

JUDGEMENT

(1.) Facts in Brief: The appellant, a jeweler, is an assessee under the Kerala Value Added Tax Act ('KVAT Act'). In the inspection carried out by the departmental authorities at the appellant's premises on 17.1.2009, they detected certain tax evasion. Next, the authorities issued Exts.P2 and P3 notices to the appellant proposing to levy a penalty for the year 2008-2009 as per Section 67 of the Act.

(2.) Under the compelling circumstances, to obviate any coercive departmental proceedings, the appellant has opted for compounding the offence under Section 74 of the Act. He did file Ext.P4 application expressing his willingness to pay Rs.2 lakh as compounding fee for the assessment year 2008-2009.

(3.) As the record reveals, the Intelligence Officer, Department of Commercial Taxes, i.e., the first respondent, insisted on the appellant's paying compounding fee at Rs.4 lakh. The enhanced demand was based on the subsequent amendment to Section 74 of the Act. Evidently, the amendment was after the assessment year, but before the appellant opted for compounding.