1. Petitioner is a partnership firm, with its head office at Chalakkudy, where it has established a jewellery. Subsequently, they opened branches at Angamaly and Kollam. Being a dealer registered under the KVAT Act (hereafter referred to as 'Act') from 20102011 onwards, the petitioner had opted for payment of tax at compounded rates as provided under Section 8(f) of the Act.

2. According to the petitioner, with effect from 31.03.2012, they closed their branch at Kollam and by Ext.P2 communication intimated the same to the first respondent. For 2012-2013 also the petitioner opted for compounding and that was accepted and the tax payable was specified in Ext.P4 order based on the tax paid for the previous year. However, in view of the closure of their Kollam Branch, with effect from 01.04.2012, they paid tax under Section 8(f) deducting 1/3rd from the tax payable for that year.

3. The Petitioner submitted Ext.P5 seeking rectification of Ext.P4 and that was disposed of by Ext.P6 order. Ext.P6 order was challenged before this Court in W.P.(c) No.30484 of 2012. By Ext.P7 judgment, the writ petition was disposed of setting aside Ext.P6 order and directing reconsideration of Ext.P5. Accordingly, the matter was reconsidered and the first respondent passed Ext.P8 order, holding that the petitioner should pay tax as provided in Section 8(f) of the Act and that in the absence of any provision in the Act allowing deduction on the closure of one of the branches, the request of the petitioner for rectification, is untenable. It is in these circumstances, the writ petition is filed seeking to challenge Exts.P4, P4(a) and P8.

4. According to the learned counsel for the petitioner, payment of tax under Section 8(f) is in lieu of the tax payable under Section 6 of the Act. Under Section 6 of the Act, once the branch is closed, the dealer does not have the liability to pay tax in respect of the closed branch and therefore, the dealer also does not have the liability to pay tax under Section 8(f) reckoning the closed branch also. In support of this contention, counsel relied on the Apex Court in the judgment in State of Kerala and another v. Builders Association of India and Others (104 STC 134 ) and the judgment of this Court in Bhima Jewellery v. Assistant Commissioner (Assessment, Special Circle and Another(129 STC 90), which was confirmed by the Division Bench in Bhima Jewellery v. Assistant Commissioner (Assessment), Special Circle, Commercial Taxes Department and Another(137 STC 377). The second contention raised by the learned counsel for the petitioner is that Explanation 3 to Section 8(f)(1) provides that a dealer opting for payment of tax under Clause 8(f) shall pay tax at compounded rates in respect of all their branches existing in the year, to which, the option relates. This according to him means that if the branch is not existing, dealer is not liable to pay tax for the branch.

5. On the other hand, according to the learned Government Pleader, payment of tax under Section 8 is purely optional and the rights and obligations of the dealer are to be determined by the provisions contained therein. It is pointed out that none of the provisions of Section 8(f) of the permit, a dealer who has opted for payment of tax under Section 8(f) of the Act to proportionately reduce the tax payable on the closure of a branch. Therefore, the learned Government Pleader argued that the petitioner could not have unilaterally reduced the liability.

6. I have considered the submissions made.

7. Under the KVAT Act, the liability of a dealer to pay tax is as provided under Section 6, which is the charging Section. However, an optional system of payment of tax has been introduced by the Legislature by virtue of Section 8 allowing dealers to opt for payment of tax at compounded rates. Insofar as dealers in gold like the petitioner are concerned, Section 8(f) provides for payment of tax at compounded rates. This provision requires the dealer to make