The petitioner who is a registered dealer under the Kerala Value Added Tax Act, is aggrieved of the detention of goods brought by the petitioner (on the strength of Exts. P1 to P3) which was detained by the first respondent issuing Ext.P4 notice under Section 47(2) of the KVAT Act doubting evasion of tax and demanding security deposit as specified therein.
2. The learned Government Pleader appearing for the respondents submits on instructions and with reference to the materials on record that, the impugned notice was issued on noting the defects as mentioned in Ext.P4 in the following terms:
“The goods are brought to Kerala through Railway Parcel by DTDC courier. As per the 8FA declaration accompanying with the consignment the goods are Electronic goods coming under 3rd schedule but on physical verification it is ascertained that the consignment is Electronic Key Duplicating Machine coming under 5th schedule Taxable @ 14.50%. Hence it is suspected that the consignee has misclassified the consignment at a lower rate of 5% to evade tax payment legitimately.”
W.P.C. No. 27699 of 2014 -2-
3. After hearing both the sides, this Court finds that this is a matter which requires to be finalized by way of adjudication proceedings under Section 47(6) of the KVAT Act. But, for that reason, the goods need not be detained and the same shall be released to the petitioner forthwith, on satisfying 25% of the security deposit demanded vide Ext. P4 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, as expeditiously as possible at any rate, within 'three 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 respondents for further steps.
Writ petition is disposed of.
P.R. RAMACHANDRA MENON, JUDGE.
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