INGRAM MICRO INDIA PRIVATE LIMITED Versus ASSISTANT COMMISSIONER SGST DEPARTMENT, SPECIAL CIRCLE-III, ERNAKULAM AND DEPUTY COMMISSIONER, COMMERCIAL TAXES, THEVARA, KOCHI
VAT and Sales Tax
2019 (3) TMI 443 – KERALA HIGH COURT – TMI
KERALA HIGH COURT – HC
Dated:- 27-2-2019
WP(C). No. 28903 of 2018
CST, VAT & Sales Tax
MR DAMA SESHADRI NAIDU, J.
\nFor The Petitioner : ADV. SRI. V. M. KRISHNAKUMAR
\nFor The Respondent : ADV. GOVERNMENT PLEADER DR. THUSHARA JAMES
\nJUDGMENT
\nFacts: The petitioner, a dealer under the Kerala Value Added Tax Act 2003, deals in IT products. It faces assessment proceedings for one year, but claims a refund for another. Thus, this writ petition concerns two assessment years: 2007-08 and 2016-17.
\n2. In 2012, dissatisfied with the petitioner's self-assessment for the AY 2007-08, the assessing officer re-opened the assessment and passed an order imposing a tax liability. The petitioner then challenged it in a statutory appeal. Finally, throu<\/p>\n
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Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n ly on 04.07.2018, the assessing officer passed two orders: the Ext.P10 order for the assessment year 2016-17; and the Ext.P11 order for the assessment year 2007-08. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n in terms of Section 89(3) of the Act, the amount must have fallen actually due by the date the assessing officer adjusted the tax. To support this contention, she has drawn my attention to Section 31(2) of the KVAT Act. Then Ms. Binoy stresses that the assessing authority could take steps to recover the amount found due from the petitioner only after issuing a notice and giving “not less than fifteen days' time” thereafter. Here, instead, the assessing officer adjusted the amount instantaneously, with no notice under Section 31(2), she adds. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n es, he has passed the orders of adjustment. So, on neither count can the orders be found fault with. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n tioner contends that, with the instantaneous adjustment, it has lost the chance of paying the tax later. Of course, it also argues that had it preferred an appeal, it would have got off by paying 20% of the demanded tax and would have had all recovery stayed until the appeal was disposed of. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n authority or any officer under subsection (5) of section 47, to refund tax or penalty to a dealer, he must comply with that. = = = = = = = =<\/p>\n Plain text (Extract) only<\/strong> = = = = = = = =<\/p>\n","protected":false},"excerpt":{"rendered":" INGRAM MICRO INDIA PRIVATE LIMITED Versus ASSISTANT COMMISSIONER SGST DEPARTMENT, SPECIAL CIRCLE-III, ERNAKULAM AND DEPUTY COMMISSIONER, COMMERCIAL TAXES, THEVARA, KOCHIVAT and Sales Tax2019 (3) TMI 443 – KERALA HIGH COURT – TMIKERALA HIGH COURT – HCDated:- 27-2-2019WP(C). No. 28903 of 2018 CST, VAT & Sales TaxMR DAMA SESHADRI NAIDU, J. For The Petitioner : ADV. … Continue reading “INGRAM MICRO INDIA PRIVATE LIMITED Versus ASSISTANT COMMISSIONER SGST DEPARTMENT, SPECIAL CIRCLE-III, ERNAKULAM AND DEPUTY COMMISSIONER, COMMERCIAL TAXES, THEVARA, KOCHI”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-17226","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/17226","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=17226"}],"version-history":[{"count":0,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=\/wp\/v2\/posts\/17226\/revisions"}],"wp:attachment":[{"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=17226"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=17226"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goodsandservicetax.in\/GST\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=17226"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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\n5. As seen from the record, the Ext.P10 order revises the petitioner's returns for AY 2007-08 and, then, under Section 25(1) of the Act determines the petitioner's tax liability for AY 2016-17, too. On the other hand, through the Ext.P11, the assessing officer grants a tax refund to the petitioner. Yet he adjusts that amount towards the petitioner's alleged liability under the Ext.P10.
\n6. Thus, the tax consolidation runs as follows: For the AY 2016-17 the tax assessed under Section 25(1) of the Act is Rs. 3,31,21,344\/-; and the refund quantified for the AY 2007-08 is Rs. 2,77,34,985\/-. Eventually, the assessing officer issued the Ext.P13 demand notice for the balance amount of Rs. 62,48,176\/-. Assailing the Exts.P10, P11 and P13 orders, the petitioner has filed this writ petition.
\nSubmissions:
\nPetitioner's:
\n7<\/p>\n
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\n10. Ms. Binoy has also contended that had the petitioner gone in appeal, it would have warded off any departmental steps for recovery by paying 20% of the assessed tax. But now the petitioner has been compelled to pay over 80% in the name of adjustment, which is unconscionable.
\nThe Respondents':
\n11. On the other hand, Dr. Thushara James, the Government Pleader, to begin with, has raised a technical issue: the petitioner has an efficacious <\/p>\n
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\nReply:
\n15. In reply, Ms. Binoy, the petitioner's counsel, has drawn my attention to the respondent's counter; she contends that the Department itself has admitted that the delay was due to administrative reasons, including that the incumbent assessing officer has assumed charge recently.
\n16. Heard Ms. Surya Binoy, the petitioner's counsel, and Dr. Thushara James, the Government Pleader.
\nDiscussion:
\n17. Simple and straight, the petitioner, an assessee under the KVAT Act, was found entitled to refund for AY 2007-08; it was also found liable under Section 25(1) of the Act for AY 2016-17. As the amount due from it was more than the amount due to it, the assessing authority adjusted the amount to be refunded and, then, demanded the balance amount. Aggrieved, the petitioner has filed this writ petition.
\n18. As much turns on-the petitioner's counsel asserts so- Sections Section<\/p>\n
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\n20. Now, we will see what Section 89 mandates. And it reads:
\n “89. Refunds.- (1) When an assessing authority finds, on completion of annual assessment, that a dealer has paid tax in excess of what is due from him, it shall refund the excess to the dealer.
\n (2) When an assessing authority receives an order from any appellate or revisional authority or any officer authorised under sub- section (5) of section 47, to make a refund of tax or penalty or cash security paid by a dealer or any other person, it shall effect the refund to such dealer or such other person, as the case may be.
\n (3) Notwithstanding anything contained in sub-section (1) and (2), the assessing authority shall have power to a<\/p>\n
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\n22. But the assessing authority has the power to adjust the amount due to be refunded towards the recovery of any amount due, on the date of adjustment, from the dealer. If the assessing authority delays refund without justification, the dealer may earn interest @10% p.a.
\n23. The question here is: Was the petitioner due to pay any amount to the Department “on the date of adjustment”?
\n24. The petitioner, indeed, asserts that its liability under Section 39(3) of the Act-that is, its obligation to pay tax- materialises only 15 days after its receiving a notice from the Department. The assessing authority's adjusting the amount, the petitioner further contends, before that eventuality is illegal.
\n25. Attractive as the petitioner's submission is, I am afraid it fails to pass the judicial muster. Section 31(1) declares that every dealer liable to pay tax for any r<\/p>\n
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