KAMMEDKUTTY P. K. Vs. STATE OF KERALA

JUDGEMENT

(1.) Whether the consequential order passed by the Assessing Authority pursuant to the remand ordered by the First Appellate Authority can survive on its own, if the order passed by the First Appellate Authority remanding the matter is set aside by the Second Appellate Forum, restoring the original order; is the point to be considered in this Revision Petition.

(2.) The petitioner, who is a PWD Contractor, was an assessee on the rolls of the Assessing Authority, Malappuram (Commercial Tax Officer (WC and LT), Malappuram) and he later came to be within the jurisdiction of the Assessing Authority at Thiruvananthapuram (Commercial Tax Officer [Works Contract], Thiruvananthapuram). In connection with the transactions for the year 2008-2009, the petitioner submitted return declaring a total turn over of Rs.10,95,30,373.00 and taxable turn over of 1,60,04,508.00. On scrutiny, the said return was rejected and it was proposed to effect assessment on 'Best Judgment Basis' under S.25(1) of the KVAT Act. This was mainly due to the fact that the value of the "work in progress" at the close of the year was not included as part of the turn over for the year and further, the vouchers issued towards 'hire charges' and 'labour charges' were found as 'self prepared' and not liable to be accepted. After affording an opportunity of hearing, the proceedings were finalised as per Annexure I Assessment order dated 30/06/2011, whereby the total turn over was fixed, adding the value of 'work in progress' and also disallowing 15% of the 'hire charges' and 10% of the 'labour charges', to be included as part of the turn over. The assessment was finalised accordingly, fixing the balance tax payable as Rs.22,15,230.00 and interest as Rs.5,75,960.00.

(3.) The above order was challenged by the petitioner by preferring an appeal before the First Appellate Authority. The contention raised was that, by virtue of R.9(c) of the KVAT Rules, 'work in progress' was not liable to be included as part of the turn over and that no amount was received by the petitioner / assessee towards the 'work in progress' reckoned by the Assessing Authority in the particular financial year. It was also contended that there was absolutely no rhyme or reason for the Assessing Authority to have disallowed 15% of the 'hire charges' and 10% of the 'labour charges'.