NATIONAL AGENCIES, CENTURY BUILDINGS Vs. COMMERCIAL TAX INSPECTOR, COMMERCIAL TAX CHECK POST, WALAYAR, PALAKKAD DISTRICT

JUDGEMENT

(1.) The petitioner's goods were detained at the check post as is seen from Ext.P5 notice. The petitioner is a dealer inter alia in plastic carry bags. The petitioner had purchased the goods from outside the State and had declared the same to be 'packing material' in the declaration uploaded in Form 8F under the Kerala Value Added Tax Act, 2003 ('KVAT Act' for short). The detention was on account of the mis-classification of the goods as 'packing material'.

(2.) The contention raised by the learned Government Pleader in support of Ext.P5 is that the petitioner, obviously, is not using the material as packing material and in such circumstance there could be no claim raised of the concessional rate of 5%, applicable only to packing materials. On facts, it is submitted that the petitioner is engaged in the sale of such material, which would attract tax at the higher rate of 20%. It is also submitted that, in such circumstance, there is discernible a clear attempt to evade tax.

(3.) The learned Counsel for the petitioner, however, submits that the petitioner had been paying tax at the rate of 20% as can be seen from the returns filed earlier. The alleged mis-classification occurred only since the State, from which the materials were purchased, does not have a Schedule as available in Section 6(1)(a) of the KVAT Act. In the Schedule, inter alia carry bags made of plastic, under item no.3, is liable to be taxed at the rate of 20%. It is submitted that there was no attempt to evade tax and the mis-classification, if at all, is a bona fide mistake.