HAMZA N Vs. STATE OF KERALA

JUDGEMENT

(1.) The question raised in the revision filed by the assessee is, whether the Tribunal was justified in sustaining the penalty levied under section 30B(4) of the Kerala General Sales Tax Act, 1963 (for short, "the KGST Act") on the petitioner. We have heard Sri T. M. Sreedharan, learned counsel appearing for the petitioner and the Government Pleader appearing for the respondent.

(2.) The petitioner is a timber merchant-cum-owner of three trucks transporting various consignments of timber from outside Kerala to the dealers in Kerala. Based on the declarations furnished, the Department made enquiries with the consignee, viz., the dealer for whom the petitioner brought the timber. However, he denied having transported the timber through the petitioner's trucks. Consequently, the Department issued notice under section 30B(4) of the KGST Act and proposed to levy tax and penalty in terms of the said provisions read with sub-section (3) of section 30B of the KGST Act. Even though the petitioner raised objection, tax was levied along with penalty at twice the amount of such tax. Though in first appeal, the order of the Intelligence Officer imposing penalty and tax was confirmed, in second appeal, the petitioner only prayed for cancellation of penalty, which was declined by the Tribunal, holding that the penalty was rightly levied under sub-section (4) read with sub-section (3) of section 30B of the KGST Act. It is against this order, the petitioner has filed revision petition before this court.

(3.) The contention of counsel for the petitioner is that section 30B(4) does not provide for any penalty and it only provides for levy of tax in respect of the consignment transported. According to the petitioner, the manner of levy as provided in sub-section (3) stated in sub-section (4) of section 30B does not take in penalty and it only adopts the procedure referred to in sub-section (3). The Government Pleader, on the other hand, submits that the manner of assessment and recovery of tax provided in sub-section (3) always includes penalty subject to the upper limit provided therein and by virtue of incorporation of sub-section (3) in sub-section (4), penalty is mandatory and discretion is only with regard to the quantum. In order to decide the controversy, we have to necessarily refer to the relevant sub-sections of section 30B of the KGST Act and therefore, the said section and sub-sections are extracted hereunder :