1. A question, the answer to which is debatable; with respect to classification, whether could attract penalty under Section 67 of the Kerala Value Added Tax Act, 2003 (KVAT Act) is the short question to be decided.

2. The brief facts for answering the above question are that the assessee sells a product which is known in the market as “Fryums”. The assessee disclosed the turnover; however, claims exemption insofar as classifying the same to be “Papads”. Entry 36 of the 1st schedule relating to 'Papad'; obviously grants exemption from tax. The debate is insofar as the Assessing Officer by Ext.P7, sought to treat it as “food products like pickles and corn flakes as included in Entry 49 of the 3rd schedule; exigible @ 4%. And the instant proceedings proceeded on the assumption that the product would be exigible at the rate of 12.5% as specified in SRO.82 of 2006 under Entry 103; residuary entry.

3. The learned senior counsel placed reliance on Cement Marketing Co. of India Ltd. v. Assistant Commissioner of Sales Tax, Indore and Others (1980 (1) SCC 71). The brief but forceful contention is that penalty under Section 67 of the KVAT Act cannot be maintained for reason of there being no contumacious conduct on the part of the assessee and for further reason that the penalty contemplated under Section 67 for attempted evasion of tax would definitely take in mens rea and cannot at all be said to be a civil obligation, which attracts penalty without anything more, other than tax delinquency as such.

4. The learned Special Government Pleader (Taxes) however, primarily opposes the writ petition on the ground of effective efficacious alternate remedy being available to the petitioner. The learned Government Pleader would also contend that the Intelligence Officer was perfectly within his powers in proceeding on an enquiry, when admittedly the petitioner had disclosed the turnover of its product as nontaxable, while obviously it was taxable.

5. Both; the learned senior counsel appearing for the assessee, as also the learned Special Government Pleader would urge this Court to consider the issue of classification on merits. However, this Court is of the opinion that the same has to be left to the assessment proceedings and it may not be proper for this Court to consider the question of classification, in a proceeding filed against a penalty order, when assessment, with all its ramifications, has to be proceeded with by the authority, conferred with such powers under the enactment.

6. An incidental look, into the facts, would reveal that the petitioner had, under the Kerala Value Added Tax Act, 2003, filed a return showing the turnover of its product; however claiming exemption as aforesaid. The Assessing Officer by Ext.P7, issued a notice under Section 25 seeking to classify the produce “Fryums” under item No.49 exigible to tax @ 4%. A detailed reply is said to have been filed in Ext.P8; on which admittedly no action has been taken till date. An assessment under the KVAT Act being one in the nature of self assessment, no order as such need be passed unless the Assessing Officer intends to meddle with the self-assessment made, on the basis of classification or otherwise, as permitted by statute. It is also clear that going by the limitation provided under the KVAT Act, the period for such interference, to the self assessment made under Section 25, is not yet over. More reason why this Court should not go into the facts and pre-empt the Assessing Authority from a consideration of the question of classification.

7. In the present writ petition the penalty proceedings are with respect to the year 2011-12 and 2012-13. Notices were issued and were replied to; however, culminating in Exts.P13 and P14 orders imposing penalty at twice the amount of tax, alleged to have been evaded for the respective years. That assessee disclosed the turn over, in the books of accounts, as also the annual returns, is not disputed at all. The power of t