(2012) 268 KLR 497 IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT: THE HONOURABLE MR.JUSTICE P.R.RAMACHANDRA MENON TUESDAY, THE 12TH DAY OF JUNE 2012/22ND JYAISHTA 1934 WP(C).No. 13527 of 2012 (M) ----------------------------------------- PETITIONERS: -------------------- 1. M/S.MALANADU CEMENTS AND ALLIED PRODUCTS PRIVATE LIMITED, REPRESENTED BY S.MURALI, AGED 53 YEARS, S/O LATE P.E. SUKUMARAN KARTHA, MANAGING DIRECTOR, 42/1685, PAWATHIL ROAD, AYYAPPANKAVU, KOCHI 682018 2. S. MURALI , AGED 53 YEARS, S/O LATE P.E. SUKUMARAN KARTHA, MANAGING DIRECTOR, MALANADU CEMENTS AND ALLIED PRODUCTS PRIVATE LIMITED, 42/1685, PAWATHIL ROAD, AYYAPPANKAVU, KOCHI 682018. 3. K.D. RAVEENDRANATH,, AGED 63 YEARS, S/O DAMODARAN NAIR, DIRECTOR, MALANADU CEMENTS AND ALLIED PRODUCTS PRIVATE LIMITED, 42/1685, RESIDING AT SREEHARI, VENNALA P.O, PALARIVATTOM, KOCHI 682028 BY ADVS.SRI.PRAVEEN K. JOY SRI.P.S.SUJETH RESPONDENTS: ----------------------- 1. STATE OF KERALA, REPRESENTED BY SECRETARY, TAXES DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM 695001. 2. THE ASSISTANT COMMISSIONER (APPEALS), OFFICE OF THE DEPUTY COMMISSIONER OF APPEALS, DEPARTMENT OF COMMERCIAL TAXES, PALAKKAD 678001. 3. COMMERCIAL TAX OFFICER, 2ND CIRCLE, PALAKKAD 678001 4. THE APPELLATE TRIBUNAL, COMMERCIAL TAXES, THEVARA, ERNAKULAM DEPUTY COMMISSIONER (APPEALS), THEVARA 682013 BY GOVERNMENT PLEADER SMT.SHOBA ANNAMMA EAPEN THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 12-06-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: MG WP(C).No. 13527 of 2012 (M) ----------------------------------------- APPENDIX PETITIONER'S EXHIBITS:
RESPONDENT'S EXHIBITS:
//TRUE COPY// PA TO JUDGE MG (CR) P.R. RAMACHANDRA MENON, J. .............................................................................. W.P (C)No.13527 OF 2012 ......................................................................... Dated this the 12th June, 2012 Head Note:- Kerala Value Added Tax Act, 2003 - Sections 60(4) & (7) - Power of review - Interim Order of the Tribunal - Whether the order already passed by the Tribunal is an order under sub-section (4) of Section 60? Held:- The opening sentence of sub-section (4) of Section 60 itself says as to the nature of the order that could be passed by the Tribunal in disposing of an appeal. Orders passed by the lower authority in the case of assessment and penalty are dealt with under clause (a) of sub-section (4) of Section 60, while the orders of other nature (passed by the lower authority) are taken care of by clause (b). It is with reference to the above provisions and the context, that the power of the Tribunal to pass appropriate orders have been dealt with in sub -section (4) and only in respect of such order passed by the Tribunal, that the power of review is provided under sub-section (7) of Section 60. Coming to the contention put forth by the petitioner that clause (b) of sub-section (4) of Section 60 comes to the rescue of the petitioner, this Court finds that the idea and understanding of the petitioner is quite wrong and misconceived. Clause (b) of sub-section (4) does not refer to an order passed by the Tribunal. It refers to an order passed by the lower authority, which is under challenge in the appeal and it is in respect of such appeal, when to be disposed of, as observed in sub-section (4), that the course open to the Tribunal is provided as stipulated in the clause mentioned therein. Since clause (b) of sub-section (4) of Section 60, obviously, is in respect of an order passed by the lower authority and not by the Tribunal, it is not an order which enables invocation of power to review under sub-section (7) of Section 60. Kerala Value Added Tax Act, 2003 - Section 66 - Power to rectify any error apparent on the face of the record - It can be exercised only in respect of an error which is discernible from the records available so as to constitute an error apparent on the face of the records and not in respect of any error which could be agitated or established by an exploratory analysis/exercise. J U D G M E N T Whether the power of review conferred on the 4th respondent Tribunal under Section 60(7) of the KVAT Act takes in the power to review an 'interim' order of the Tribunal, is the point for consideration. 2. The assessment finalised in respect of the assessment year 2005-06 was challenged by filing statutory appeal, but it did not turn to be fruitful in the first round of litigation, which made the petitioner to pursue the second round by filing Ext.P1 appeal before the 4th respondent/Tribunal. Along with the appeal, the petitioner also preferred an interlocutory application for stay in respect of the coercive proceedings. 3. After considering the merits involved, the Tribunal passed Ext.P2 order on 30.03.2012, whereby interim stay was granted subject to the satisfaction of a sum of Rs. Five lakhs and furnishing of security for the balance amount within four weeks. 4. Being aggrieved of the said order, the petitioner filed Ext. P5 application for review, pointing out that, while passing the interim order some material documents had not been looked into, thus seeking to call for immediate interference. The said application was opposed from the part of the respondents, particularly on the question of maintainability. The issue was considered by the Tribunal with reference to the specific case projected by the petitioner, also in the light of the argument notes explaining the scope of review and with reference to the relevant provisions of law. 5. After considering the matter and the scope of review under Section 60(7) of the VAT Act, 2003, the Tribunal observed that the power vested upon the Tribunal to have any order reviewed is only in respect of a case covered by Section 60(4) dealing with final disposal of the appeal and as such, the Review Petition preferred by the petitioner was not correct or sustainable. Accordingly, interference was declined and the Review Petition was dismissed, which forms the subject matter of challenge in this writ petition. 6. Heard the learned Government Pleader as well. 7. During the course of hearing, the learned Counsel for the petitioner submits that the provision has been wrongly interpreted by the Tribunal and that Review Petition is very much maintainable even against an interim order, as in the instant case, as separately taken care of by clause (b) of Section 60(4). For the purpose of easy understanding of the provisions, the same are extracted below: Section 60(4): "(4) In disposing of an appeal, the Appellate Tribunal may after giving the parties a reasonable opportunity of being heard either in person or by a representative,- (a) in the case of an order of assessment or penalty,- (i) confirm, reduce, enhance or annul the assessment or penalty or both (ii) set aside the assessment and direct the assessing authority to make a fresh assessment after such further enquiry as may be directed ;or (iii) pass such other orders as it may think fit; or (b) in the case of any other order, confirm, cancel or vary such order; Provided that if the appeal involves a question of law on which the Appellate Tribunal has previously given its decision in another appeal and either a revision petition to the High Court against such decision or an appeal to the Supreme Court against the order of the High Court thereon is pending, the Appellate Tribunal may defer the hearing of the appeal before it, till such revision petition to the High Court or the appeal to the Supreme Court is disposed of. "Section 60(7): "(7) The Appellate Tribunal may, on the application of the appellant or the respondent review any order passed by it under sub-section (4) on the basis of the discovery of new and important facts which after the exercise of due diligence were not within the knowledge of the applicant or could not be produced by him when the order was made; Provided that no such application shall be preferred more than once in respect of the same order." Sub section(7) of Section 60 clearly says that the power to be exercised by the Tribunal, by way of Review is in respect of an order passed by it under sub-section (4) of Section 60, on the basis of the discovery of new and important facts, which after the exercise of due diligence were not within the knowledge of the applicant or could not be produced by him when the order was made. 8. The question is whether the order already passed by the Tribunal is an order under sub-section (4) of Section 60. The opening sentence of sub-section (4) of Section 60 itself says as to the nature of the order that could be passed by the Tribunal in disposing of an appeal. Orders passed by the lower authority in the case of assessment and penalty are dealt with under clause (a) of sub-section (4) of Section 60, while the orders of other nature (passed by the lower authority) are taken care of by clause (b). It is with reference to the above provisions and the context, that the power of the Tribunal to pass appropriate orders have been dealt with in sub -section (4) and only in respect of such order passed by the Tribunal, that the power of review is provided under sub-section (7) of Section 60. 9. Coming to the contention put forth by the petitioner that clause (b) of sub-section (4) of Section 60 comes to the rescue of the petitioner, this Court finds that the idea and understanding of the petitioner is quite wrong and misconceived. Clause (b) of sub-section (4) does not refer to an order passed by the Tribunal. It refers to an order passed by the lower authority, which is under challenge in the appeal and it is in respect of such appeal, when to be disposed of, as observed in sub-section (4), that the course open to the Tribunal is provided as stipulated in the clause mentioned therein. Since clause (b) of sub-section (4) of Section 60, obviously, is in respect of an order passed by the lower authority and not by the Tribunal, it is not an order which enables invocation of power to review under sub-section (7) of Section 60. 10. The learned Counsel for the petitioner then refers to the course and power as stipulated under section 66, which reads as follows: Section 66: "66. Power to rectify any error apparent on the face of the record.- (1) Any authority includin Appellate Tribunal and Settlement Commission issuing any order or proceedings under this Act may, on application or otherwise, at any time within four years from the year in which the order is passed by it, rectify any error apparent on the face of the record. Provided that no such rectification, which has the effect of enhancing an assessment or any penalty, shall be made unless such authority has given notice to the person affected and has allowed him a reasonable opportunity of being heard. (2) Where such rectification has the effect of reducing an assessment or penalty, the assessing authority shall make any refund to the person entitled thereto. (3) Where any such rectification has the effect of enhancing an assessment or penalty, the assessing authority shall give the dealer or other person, a revised notice of assessment or penalty and thereupon the provisions of this Act and the rules made thereunder shall apply as if such notice has been given in the first instance. Explanation:- The liability to pay the tax or other amount shall arise only from the date specified in the revised notice." Obviously, the above power is to rectify an 'error apparent on the face of the record'. This is akin to the scope of review under similar provisions of other similar statutes and the general power of the civil courts under Section 114 of the CPC. The scope of such general power has been explained by the Apex Court on many an occasion holding that it can be exercised only in respect of an error which is discernible from the records available so as to constitute an error apparent on the face of the records and not in respect of any error which could be agitated or established by an exploratory analysis/exercise. The scope of interference and jurisdiction of the Courts in this regard has been crystallised as mentioned above; more so in view of the law declared by the Apex Court in Meera Bhanja vs. Nirmala Kumari Choudhuri [AIR 1995 SC 455 ]. 11. Admittedly, the power sought to be invoked by filing the application for review is with reference to the specific power under Section 60(7) of the KVAT Act, as dealt with by the Tribunal in Ext. P7. The pleadings and grounds raised in the writ petition have been set forth with reference to Section 60(4)(b), read with Section 60(7) and not with reference to Section 66. However, it does not come to the rescue of the petitioner in any manner. 12. The learned Counsel for the petitioner further submits that restriction of power and jurisdiction of the Tribunal merely to the final orders, is a mistake and said power is very much exercisable in the case of interim orders as well. Reliance is sought to be placed on the decisions rendered by the Apex Court in AIR 1969 SC 430 (Income Tax Officer vs. Mohammed Kunhi) , AIR 1996 SC 646 (Reserve Bank of India and others vs. Peerless General Finance and Investment Company Ltd and another.), and AIR 1996 SC 3527(M/s. J.K. Synthetics Ltd. vs. Collector of Central Excise). The crux of the decisions as above, speak about the scope of power in respect of incidental proceedings, when no express power is conferred under the statute. 13. It is settled law that, when the statute prescribes something to be done in a particular manner, it can be done only in that particular manner and in no other manner. Having conferred power and jurisdiction upon the Tribunal to review orders, the type of which has been made explicitly clear in sub- section (7) of Section 60 , by making a reference to an instance covered by sub-section (4) of Section 60, the only question to be looked into is, whether this is a case which falls within the purview of sub-section (4) of Section 60. The contention raised by the petitioner that the case of the petitioner will definitely fall in line with clause (b) of Section 60(4) stands already answered against the petitioner, as the 'order' contemplated under clause (b) is an 'order' passed by the lower authority and not by the Tribunal. This being the position, this Court finds that the decisions cited across the Bar do not support the case of the petitioner in any manner. 14. Coming to the factual position available in the case in hand, the dispute is with regard to fixation of liability, the extent and sustainability of which are under challenge. It was after considering the appeal, that the Tribunal passed the interim order by way of Ext.P2 directing to satisfy a portion of the said liability, to the extent as specified therein, so as to avail the benefit of interim stay during the pendency of the appeal. This is by virtue of the discretion exercised by the concerned authority with reference to the actual facts and figures and with proper application of mind. This does not constitute any 'error apparent on the face of the record' or otherwise to have called for a review, invoking the power and jurisdiction of the Tribunal under section 66 or under Section 60(7) of the KVAT Act. (7) of Section 60. This Court finds that the challenge raised against Ext.P7 order passed by the Tribunal is devoid of any merit. None of the grounds raised in this writ petition does serve the purpose. The writ petition fails and it is dismissed accordingly. It is open for the petitioner to file a petition for early hearing of the appeal, in the event of which, appropriate orders shall be passed on the same by the Tribunal. Sd/ P.R. RAMACHANDRA MENON, JUDGE. lk |
