Vitrified tiles imported by the petitioner from China and cleared from the Customs Department as covered by Ext.P1 bill of entry dated 09.10.2014, came to be intercepted in the course of transit, issuing Ext.P6(A)/P6(B) notices under Section 47(2) of the KVAT Act doubting evasion of tax and demanding security deposit. This made the petitioner to approach this Court contending that the interception is per se wrong and illegal in all respects and it is nothing but an 'interstate sale'.
2. Learned counsel for the petitioner submits with reference to the materials on record that, the petitioner is a registered dealer in the State of Gujarat, who wanted to import vitrified tiles from China, through the Cochin Port, and made necessary arrangements in this regard. While so, the petitioner received Ext.P2 purchase order from a dealer in tiles in Mahe on 04.10.2014. On arrival of the goods in Cochin Port, the same was got cleared, satisfying the customs duty. Meanwhile, it is averred that the petitioner had raised Ext.P3 invoices dated 30.10.2014, in the name of the buyer at Mahe. Necessary e-declaration was submitted vide Ext.P4 on 06.11.2014 and the goods were transported on the strength of Ext.P5 'Transit Pass' as well. This being the position, there is absolute no rhyme or reason to have the vehicles with goods detained, and hence the challenge.
3. The learned Government Pleader appearing for the respondents submits that, Ext.P3 invoice raised by the petitioner is not with reference to Ext.P2 purchase order dated 04.10.2014, but with reference to an alleged purchase order dated 28.10.2014. It is contended that, to cover up the issue and to evade the tax, the petitioner has sought to fabricate documents, in the form of Ext.P2 which however was not part of the records in the course of transit, though it is not a document envisaged under Section 46(3) of the KVAT Act.
4. Pursuant to the order passed by this Court on 17.11.2014, as to how the purchase order came to the hands of the petitioner, it is stated by the learned counsel for the petitioner that Ext.P2 was given 'by hand', by the dealer in Mahe, to the petitioner in Gujarat. It is stated that, on confirmation of Ext.P2 over telephone, Ext.P3 invoice was raised on 30.10.2014 referring to such confirmation on 28.10.2014. This Court prima facie finds it difficult to accept the said explanation, in so far as Ext.P2 itself shows that, it is the confirmation letter placed by the dealer in Mahe, pursuant to the telephonic conversations as referred to therein. This being the position, nothing prevented the petitioner from showing the said confirmation order in writing, which is dated 04.10.2014, in Ext.P3 invoice. That apart, the address of the buyer at Mahe has been shown in Kerala, in the first page of Ext.P3, which may or may not be a mistake and it may be possible, if the said dealer is having a unit in Kerala, with regard which this Court does not propose to express any opinion. The factual position as to the nature of transaction can be brought to light only by way of adjudication proceedings.
5. It is brought to the notice of this Court by the learned Government Pleader that, the petitioner is not a registered dealer in Kerala and same is the position with regard to the consignee, who is in Mahe. However, considering the totality of circumstances, the petitioner is permitted to have the vehicles and goods released on satisfaction on 25% of the disputed liability and on executing a 'simple bond' without sureties for the balance amount. This however shall be without prejudice to the rights and liberties of the respondent/competent authority to proceed with the adjudication proceedings, which shall be finalized in accordance with law, with notice to the petitioner, as expeditiously as possible at any rate, within 'two months' from the date of receipt of a copy of this judgment. The petitioner shall produce a copy of the judgment along with a copy of the writ petition before the concerned respondent for further steps.
Writ petition is disposed of.
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P.R. RAMACHANDRA MENON, JUDGE.
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