A.K. Jayasankaran Nambiar, J.

1. As the issue involved in both these writ petitions is the same, they are taken up together for consideration and disposed by this common judgment.

2. The petitioner in W.P.(C). No. 5348/2015 is an online service provider, registered as such under the Finance Act, 1994, as amended, governing the levy of Service Tax. In the writ petition, the petitioner is aggrieved by orders of penalty that have been passed against it by the authorities under the Kerala Value Added Tax Act [hereinafter referred to as the 'K.V.A.T. Act']. The said orders have been passed under Section 67 of the K.V.A.T. Act, inter alia on the finding that the petitioner has breached the provisions of Sections 20 and 40 of the K.V.A.T. Act in not getting itself registered as a dealer under the K.V.A.T. Act and further, not filing returns and maintaining true and correct accounts as mandated under the said Act.

3. The main contention of the petitioner in the writ petition is that it is a service provider who is not engaged in the business of sale or purchase of goods. It is pointed out that it merely facilitates transactions of sale and purchase through its online portal and, after an online customer identifies a product of his choice, the seller of the particular product is notified of the choice of the customer and he, in turn, raises an invoice on the customer and makes arrangements for the delivery of the product to the customer. Further, depending on the nature of the sale transaction, whether intra-state or inter-state, the seller of the product pays tax either under the local VAT Act or under the C.S.T Act, and the fact of payment of tax is indicated in the invoice issued to the customer. The petitioner contends that it has absolutely no role to play in the transaction of sale and purchase and hence it could not have been proceeded against under the penal provisions of the K.V.A.T. Act. It is its further contention that even if the respondent authorities were of the view that it ought to have filed returns and paid tax under the Act, an opportunity ought to have been first afforded to it in terms of Section 22 of the K.V.A.T. Act before proceeding to issue a notice under Section 67 of the K.V.A.T. Act. Referring to the orders impugned in the writ petition, it is also contended that the findings therein, that the petitioner had effected sales within the State of Kerala, was factually incorrect, and the transactions were, in fact, sales effected by WS Retail and other sellers, who were registered sellers on its web site. According to the petitioner, the said sales were all inter-state sales as the sale transactions occasioned a movement of the respective goods from outside the State to various locations within the State of Kerala.

4. As far as the petitioner in W.P.(C). No. 6916/2015 is concerned, while the orders imposing penalty, impugned in its writ petition, proceed on similar lines as the orders impugned in W.P. (C). No. 5348/2015, the only difference in the facts is that the petitioner herein is a person who actually engages in the business of sale and purchase through an online portal-myntra.com. The petitioner, however, maintains that during the relevant period, it was a registered dealer under the Karnataka Value Added Tax Act and was paying tax in respect of the local sales and inter-state sales effected from its business premises in the State of Karnataka. The orders of penalty, impugned in the writ petition, find that all the sales effected to its customers in Kerala are local sales and it is on the said premise that the petitioner has been proceeded against under the penal provisions of the K.V.A.T. Act and

5. I have heard Sri. Joseph Vellapally and Sri. Joseph Kodianthara, the learned Senior Counsel appearing for the petitioners in both the writ petitions and Sri Liju V. Stephen, the learned Government Pleader appearing for the respondents in both the writ petitions.

6. On a consideration of the facts and cir