KERALA CURRY HOUSE Vs. SALES TAX OFFICER

JUDGEMENT

(1.) The petitioner started a hotel business in April 2007, but failed to get themselves registered under the provisions of the Kerala Value Added Tax Act, 2003 ("the KVAT Act"), in spite of the turnover exceeded the limits prescribed under the said statute. The Intelligence Wing of the Commercial Taxes Department inspected the business place during May 2008 and detected the offence of non -registration and non -payment of tax, for the year 2007 -08. However, the petitioner compounded the offence and paid the compounding fee as well as the tax due, along with interest, for the year concerned as evidenced from exhibit P5 proceedings of the Intelligence Officer. The assessing authority concerned had also completed the assessment with respect to the year, and it is stated that appeal against such assessment is now pending.

(2.) SUBSEQUENT to the inspection conducted by the intelligence wing, the petitioner submitted exhibit P7 application for registration, and registration was granted by the authority. According to the petitioner the date of commencement of business was happened to be wrongly shown in the application as April 1, 2008 instead of April 1, 2007. Hence the petitioner submitted exhibit P8 application seeking correction of the date of commencement of business in the registration particulars. He had produced documents pertaining to the inspection and assessment in support of his contention that actual date of commencement of business was April 1, 2007. But the petition submitted under exhibit P8 for getting the date of commencement of business corrected, is now been rejected by the respondent through exhibit P9 order. The petitioner is aggrieved by the said order. It is noticed from exhibit P9 that the correction sought for was disallowed by the respondent on the ground that the petitioner himself had shown the date of commencement of business as April 1, 2008 in the application submitted in form No. I. Further it is observed that the assessment with respect to the year 2007 -08 is pending in appeal and therefore such correction cannot be allowed.

(3.) THE amended proviso of section 16(2) is to the effect that the registration shall be deemed to have been granted with effect from the date of commencement of the business, irrespective of the date of application for registration, for the purposes like payment of tax under sub -section (5) of section 6 or for opting payment under the compounded rate under section 8. In the case at hand, the authorities concerned have imposed penalty as well as assessment with respect to the year 2007 -08. It is evident that in fact the petitioner had carried out business during the said year and the authorities had imposed liability to tax on the petitioner with respect to that year. Therefore it could not be denied that the petitioner had commenced business during the assessment year 2007 -08. At the same time the question which is to be considered is as to whether the proceedings which are already initiated against the petitioner for imposition of tax or penalty, pertaining to the period prior to submission of application for registration can be allowed to be altered or prejudiced in view of the correction of date of commencement of business to be granted in the registration particulars. Going by the above quoted provisions it is evident that the statute had permitted certain benefits which the assessee can avail of by virtue of the clause provided therein, regarding the date of commencement of business. Therefore the question in this regard will be governed by the provisions contained therein.