The petitioner is an assessee under the KGST Act and the CST Act. The assessment of the petitioner under the KGST Act for the period from 1998-99 to 2000-01 were completed by the 2nd respondent Assessing Authority. Against the assessment orders, the petitioner preferred appeals before the 1st respondent Appellate Authority. The 1st respondent initially passed an appellate order for the aforementioned assessment years. That order was impugned by the petitioner in W.P.(C).No.1789/2010 which was disposed by Ext.P3 judgment setting aside the appellate order passed by the 1st respondent and remanding the matter to him to consider the same de novo and pass fresh orders in accordance with law after hearing the petitioner. In Ext.P3 judgment, the 1st respondent was directed to pass orders in the appeal within two months from the date of receipt of a copy of the judgment. Pursuant to Ext.P3 judgment, the 1st respondent passed Ext.P4 order wherein he has entered findings with regard to the two issues that had come up for consideration in the appeal. On the issue of exemption in respect of second sales effected by the petitioner, the 1st respondent noted the submissions of the petitioner, with regard to the existence of the dealers from whom he had purchased the goods that he had subsequently sold within the State. It is noted in Ext.P4 order that the books of accounts produced for assessment in the year 1998-99 were checked up properly and the appellant is eligible for the exemption on the second sales turn over of rice, wheat and resin purchased from registered dealers within the State supported by purchase bills issued by them. With regard to the other issue concerning “C” Form, it was found that the sale in transit as contended by the petitioner was not proved by “El” and “C” Forms and therefore it was to be assessed as local sales. After having made these observations in Ext.P4, the 1st respondent remanded the matter to the Assessing authority for verification of the contentions and books of accounts of the petitioner once again and to pass modified orders in the matter. Ext.P4 order of the 1st respondent to the extent it remands the matter to the Assessing authority is impugned in the writ petition inter alia on the ground that the direction of this Court in Ext.P3 judgment was to the 1st respondent to pass orders afresh and further, that in view of the amendments that were brought about in the KGST Act, the 1st respondent did not have a power of remand. 2. I have heard Sri.Raju Joseph, the learned senior counsel appearing on behalf of the petitioner as also Smt.Lilly.K.T., the learned Government Pleader appearing on behalf of the respondents.
4. On a consideration of the facts and circumstances of the case as also the submissions made across the Bar, I note that this is a case where this Court, by Ext.P3 judgment, directed the 1st respondent appellate authority to consider the appeal preferred by the petitioner for the assessment year 1998-99 afresh and pass orders in the matter within a specified time frame. In Ext.P4 order that has been passed by the 1st respondent Appellate Authority, he has taken into account the documents and evidence, that was produced before him by the petitioner to establish that the persons from whom he had purchased goods for resale within the State were registered dealers in existence within the State. This evidence was produced by the petitioner in the wake of the objections that had been earlier pointed out by the Department as regards the existence of the dealers from whom the petitioner is stated to have purchased the goods. After going through the evidence produced before him and noting the submissions on behalf of the petitioner, the 1st respondent observed as follows:
“The appellant further argued that there is no suppression in turnover conceded. The compounding was not for any suppression in turnover. But for the inadequacy of proof and evidence for claiming tax exemptions. The books of accounts produced for the assessment year 1998-99 were checked up properly and the appellant is eligible for exemption on the 2nd sales turnover of rice, wheat and resin purchased from registered dealers within the State supported by purchase bills issued by them. The consignment sales of Rs.42,95,910/- is proved by sales pattial, etc. by the details of sales collection by M/s.K.M.Mehta & Co., Mattanchery is proved by sales pattial submitted by appellant.”
It is the contention of the learned senior counsel appearing on behalf of the petitioner that the extracted portion above, in Ext.P4 order of the Appellate Authority, indicates his findings on the issue of whether or not the petitioner was entitled to the benefit of second sale exemption.
5. Per contra, the learned Government Pleader would contend that the extracted portion is not the finding of the Appellate Authority but only the recording of the submissions of the petitioner before the said Authority. Confronted with this situation, I have to analyse the nature of the said observations in Ext.P4 in the light of what was expected of the 1st respondent while passing Ext.P4 order. As already noted, Ext.P4 order was passed pursuant to a specific direction from this Court to pass orders in the matter. That apart, the statutory provisions during the relevant period, did not enable the 1st respondent Appellate Authority to remand the matter to the lower authorities. In that backdrop therefore, I can only view the observations of the 1st respondent appellate authority as his findings with regard to the entitlement of the petitioner for the grant of exemption of second sales effected by him. There is no dispute that there was a finding rendered by the Appellate authority on the other issue with regard to transit sales which he found against the petitioner. Under these circumstances, the directions in Ext.P4, issued to the assessing authority, can only be seen as intended to guide the assessing authority while passing consequential orders based on Ext.P4 appellate order. Accordingly, I dispose this writ petition by quashing Ext.P4 to the extent it remands the matter to the assessing authority for a de novo adjudication of all the issues that were involved in the appeal for the assessment year 1998-99. The 2nd respondent assessing authority shall pass consequential orders by treating Ext.P4 as the appellate order deciding the two issues therein, within a period of two months from the date of receipt of a copy of this judgment.
A.K.JAYASANKARAN NAMBIAR JUDGE prp