C. N. RAMACHANDRAN NAIR :-

The challenge raised in the writ appeals and the writ petitions is against the constitutional validity of section 17D of the Kerala General Sales Tax Act, 1963 (hereinafter called, "the Act"). The value added tax regime came into force in Kerala by the introduction of the Kerala Value Added Tax Act, 2003 with effect from April 1, 2005. The KGST Act has ceased to be operational since the commencement of the VAT Act except in regard to the trade in petrol, diesel and alcoholic products. In other words, from 2005-06 onwards the KGST Act has become redundant for most of the dealers who are governed by the VAT Act. However, the Government noticed that thousands of assessments under the KGST Act were pending even after two years of the commencement of the VAT regime and as a measure for early finalisation of pending assessments, the Finance Act, 2007 introduced a summary procedure for completion of pending assessments. It is this scheme of summary assessment covered by section 17D of the Act that was challenged by few dealers before the single judges. Two learned single judges upheld the constitutional validity of section 17D, against which the connected writ appeals are filed. Remaining cases are new cases filed before the single judge challenging the very same statutory provision and therefore, those cases are also listed with the writ appeals. We have heard various counsel appearing for the appellants/petitioners and the Special Government Pleader appearing for the respondents.

For easy reference we extract hereunder section 17D with all its sub-sections :

"17D. Fast track method of completion of assessment. - (1) Notwithstanding anything contained in any other law for the time being in force or in any other provisions of this Act assessments pending under the Act as on the 1st day of April, 2007 may, subject to the provisions of sub-section (2), be completed under the fast track method.

(2) The assessment under sub-section (1) shall be completed in the following manner, namely :-

(a) The assessment shall be completed by a 'team' comprising of a team of officers which shall be constituted by the Commissioner;

(b) In the case of files relating to special circles, there shall be three Assistant Commissioners in the team, headed by a Deputy Commissioner. In the case of ordinary circles, the team shall be headed by an Assistant Commissioner and comprise three Commercial Tax Officers as members;

(c) All files of the dealer pertaining to an assessment year shall be clubbed with assessment file and taken up for disposal;

(d) No assessment completed by the terms shall be reopened unless there is fresh receipt of materials pertaining to tax evasion :

Provided that the assessment may be reopened with the prior permission of the Commissioner;

(e) The assessment shall be completed fairly by a summary proceeding;

and in cases where the returns are not acceptable, the following criteria may be adopted for determining their tax liability, namely :-

(i) in case where the dealer had compounded the offence under section 47, or penalty under section 45A or section 29A has been levied, the assessment may be completed on an addition proportionate to the period of suppression with reference to the quantum of suppression detected, limiting the tax effect on such addition to a maximum of three times of the compounding fee paid or tax effect of suppression detected, whichever is higher, and in case where a pattern of suppression has not been established, to an amount equal to the suppression detected.

(ii) in case where tax evaded cannot be quantified, the assessment may be completed on an addition equal to five per cent of the taxable turnover conceded by the dealer as per his returns or accounts, subject to tax effect of a minimum of five thousand rupees and a maximum of one lakh rupees.

(iii) in case where statutory forms and/or declarations in support of a claim of concessional rate of tax or exemption have not been