2014 (11) TMI 1089 - HC - VAT and Sales Tax

Validity of Exts.P6 and P7 - transporting agency - dealer - Section 2(xv) of the KVAT Act - whether the respondent was liable to take out registration under Section 15 of the KVAT Act? Held that - Section 15 of the KVAT Act provides that every dealer whose total turnover in any year is not less than ten lakhs shall, and any other dealer may, get himself registered under the Act. Liability under Section 15 to take out registration is that of a dealer. By clauses (a) to (d), various categories of dealers have been included in the definition of dealer - none of these categories mentioned in Section 2(xv) include a transporting agent like the respondent. Transporting agent outside the purview of definition of dealer, not liable to take registration under section 15 of the KVAT Act - Exts.P6 and P7 are illegal - appeal dismissed - decided against appellant.

Summary

Issues: Validity of Exts.P6 and P7, Liability to take out registration under Section 15 of the KVAT Act

The judgment delivered by the Kerala High Court in this case revolves around the appeal filed by the respondents who were aggrieved by the decision of the learned single Judge in favor of the respondent, a transporting agency. The primary issue raised in the writ petition was the validity of documents Exts.P6 and P7, along with the question of whether the respondent was obligated to register under Section 15 of the KVAT Act. The respondent contended that they were not liable for registration as they did not fall under the definition of a "dealer" as per Section 2(xv) of the KVAT Act, a stance upheld by the single Judge leading to the writ petition being allowed.

The court examined Section 15 of the KVAT Act, which mandates registration for dealers with a total turnover of not less than ten lakhs in a year. The term "dealer" is defined in Section 2(xv) as a person engaged in various activities related to goods and services, excluding agriculturists. The court noted that none of the categories listed under Section 2(xv) encompassed a transporting agent like the respondent. Consequently, the court concluded that a transporting agent did not fall within the definition of a dealer, thereby negating the need for registration under Section 15 of the Act. The judgment emphasized that the obligation to register was specifically for dealers, and since transporting agents did not fit this classification, the conclusion reached by the single Judge was upheld, rendering Exts.P6 and P7 as legal.

In the final analysis, the High Court dismissed the writ appeal, affirming the decision that the respondent, a transporting agency, was not considered a dealer under the KVAT Act. The judgment highlighted that the transporting agent did not meet the criteria outlined in Section 2(xv) and therefore was not obligated to register under Section 15. By upholding the single Judge's ruling, the High Court maintained that the documents in question, Exts.P6 and P7, were not illegal.