WP(C) No. 31763 of 2009 · Kerala High Court
Case at a glance
Provisions considered
- KeralaValue Added Tax Act, 2003 s. 67(1)(j)
Judgment
C.K.ABDUL REHIM, J. ------------------------------W.P.(C).No.31763 OF 2009 ------------------------------Dated this the 9th day of November, 2009J U D G M E N T----------------------1.Petitioner is the owner of a Goods vehicle bearingNo:KA-19/AB-1571. Grievance of the petitioner is that thevehicle in question is now detained by 1st respondent pursuant toissuance of Ext.P2 notice under Section 67(1)(j) of the KeralaValue Added Tax Act, 2003 (KVAT Act). The allegation in Ext.P2is that the petitioner had used the vehicle for transporting livechicken, value of which is estimated at Rs.2,18,000/-, by usingdelivery note issued by one Sri:C.P. Rasheed, a registered dealerunder the KVAT Act, from Mysore to Calicut. At the time oftransportation the Advance Tax was paid through a chequewhich was subsequently dishonoured for the reason of“insufficient funds”. It is alleged that the cheque in question wasissued misrepresenting the same as if it is a Demand Draft. It isfurther suspected that the driver or the person in charge of thevehicle had colluded with the owner of the goods in attempt ofevasion of payment of tax. Therefore it is alleged that thevehicle is involved in committing fraud on the Government andthereby punishment under Section 67(1)(j) is warranted. W.P.(C).31763/09-M2Penalty is proposed to the tune of double the amount of taxsought to be evaded.
It is contended by the petitioner that imposition ofpenalty on the driver or person in charge of the vehicle is notsustainable based on the allegations contained in Ext.P2 notice, even if it is assumed that those allegations are true and correct. Learned counsel for the petitioner points out Section 51 of theKVAT Act which prescribes liabilities upon persons in charge of avehicle while transporting any consignment of goods. The saidprovision requires that the owner or other person in charge of avehicle shall carry with him documents prescribed under Section46(3) of the KVAT Act while transporting any consignment. There is no allegation in this case that the transport in questionwas effected without any valid documents as required under Section 46(3). It is also pertinent to note that the transport waspermitted at the relevant time by the authorities at the bordercheck post, on receiving the instrument in question towardspayment of Advance Tax, whereas the relevant circular whichinsists payment of Advance Tax permits payment only throughDemand Drafts.
However, going by the impugned notice it cannot bealleged that the driver or person in charge of the vehicle has gotany role or in any way responsible in tendering of the instrument W.P.(C).31763/09-M3in question, towards payment of Advance Tax, and in thesubsequent dishonour. Further more, detention of the vehicle atany rate cannot be justified under the provisions of Section 67. Hence I am of the opinion that the detention of the vehicle aswell as issuance of Ext.P2 notice proposing imposition of penaltyis initiated on a total misconception of the provision contained inthe Act. 4. Under the above circumstances Ext.P2 is herebyquashed. However, it is made clear that quashing of Ext.P2 willnot in any way affect proceedings against the vehicle or itsowner or driver, in the criminal case if any registered againstthem in this regard. C.K.ABDUL REHIM, JUDGE.okb
Questions this judgment answers
Which statutory provisions did this judgment involve?
KeralaValue Added Tax Act, 2003 — s. 67(1)(j).
Which court decided this case, and when?
Kerala High Court, on 09 Nov 2009. The bench was C K ABDUL REHIM.
Precedent status how later indexed judgments have treated this case
No known negative treatment found in the Courts & Cases corpus.
This is a result about the indexed corpus, not a finding that the judgment remains good law. Coverage may be incomplete.