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2025 Supreme(Online)(Ker) 19486
IN THE HIGH COURT OF KERALA AT ERNAKULAM
BECHU KURIAN THOMAS, J
PRASAD T.S – Appellant
Versus
THE STATE TAX OFFICER, ALAPPUZHA KSGST DEPARTMENT – Respondent
WP(C) 5224/2023
For the Appellants/Petitioners: V.DEVANANDA NARASIMHAM, P.H.RIYAS
For the Respondents: DR.THUSHARA JAMES, SENIOR GOVERNMENT PLEADER
The Court determined that issues regarding gross profit addition to turnover required factual analysis and dismissed the writ petition, directing statutory remedies.
Headnote:Petitioner challenges Ext.P2 order of assessment issued under Section 17(3) of the Kerala General Sales Tax Act, 1963. The assessing officer added 20% of the turnover as gross profit and imposed a 5% tax based on Ext.P1 notification. The petitioner claims this methodology was perverse. The Court found that the addition of gross profit requires factual appreciation and dismissed the writ, directing the petitioner to pursue appellate remedies. 'I dismiss this writ petition relegating the petitioner to pursue his statutory remedies in accordance with law.'
| Table of Content |
|---|
| 1. challenge to tax assessment process and methodology. (Para 1 , 2) |
| 2. previous case provides context for current interests. (Para 3) |
| 3. dismissal of writ; petitioner directed to pursue statutory remedies. (Para 4) |
JUDGMENT
Petitioner challenges Ext.P2 order of assessment issued by the first respondent under Section 17 (3) of the Kerala General Sales Tax Act , 1963.
2. The issue relates to the assessment year 2020-21. The assessing officer has, while calculating the turnover tax, added 20% of the turnover as gross profit to the turnover and imposed turnover tax @5% based on Ext.P1 notification. According to the petitioner, the methodology adopted by the assessing officer as mentioned above is perverse and is liable to be interfered with by this Court under Article 226 of the Constitution of India . Petitioner has also raised a challenge against the interest component imposed in Ext.P2 as well as the levy of cess.
3. Though this Court had admitted this matter in view of similar challenges relating to the interest component, those cases were all disposed of by a common judgment dated 30.11.2023 in W.P.(C) No.32408/2023 and connected matters. On a perusal of the aforesaid judgment, it is noticed that the learned Single Judge had observed as follows :-
“(i) In cases where the returns are filed by 31.03.2022, and ToT was cleared on or before 30.04.2022, the FL3/FL11 licensees are not liable to pay interest for delayed payment of the turnover tax for the period 22.05.2020 to 21.12.2020 and 15.06.2021 to 25.09.2021 in Financial Years 2020-21 and 2021-22.
(ii) If any FL3/FL11 licensees did not file the return of ToT in respect of the taxable turnover of the parcel sales of IMFL for the period of authorised sale on or before 31.03.2022 and not paid the ToT at 5% by 30.04.2022, such a licensee/ dealer would be liable to pay interest for delayed payment of ToT with effect from 01.05.2022 till the date of payment and for delay in filing returns.
(iii) In all these cases, the impugned orders are quashed, and the cases are remitted back to the Assessing Authority to pass fresh Assessment Orders as per the (i) and (ii) mentioned above.”
4. However, as mentioned earlier, it is evident that the issue in those cases concerned only the interest component which was also one of the issues that arises in the instant case. As far as the addition of gross profit to the turnover and tax imposed thereon are concerned, it requires appreciation of facts. Therefore the petitioner ought to be relegated to pursue the appellate remedies as available under law instead of this Curt considering the issues under Article 226 of the Constitution of India .
Hence, I dismiss this writ petition relegating the petitioner to pursue his statutory remedies in accordance with law. The period spent by the petitioner in pursuing this writ petition from 11.02.2023 till today shall stand excluded for the purpose of limitation. The decision of this Court in W.P.(C) No.32408/2023 and connected matters shall certainly be taken into consideration while disposing the appeal on merits. The appellate authority shall consider the appeal, if any filed by the petitioner, as expeditiously as possible, after granting an opportunity of hearing.
