2019 (4) TMI 1456 - HC - VAT and Sales Tax

Maintainability of petition - statutory remedy of appeal - Rate of tax - Water supply and sanitary equipments and fittings of every description - whether the articles dealt with by the appellant/petitioner is liable to be taxed at the rate stipulated in Sl. No.101 in SRO No.82/2006 or not? - HELD THAT - The indulgence of this court can be shown to facilitate the appellant/petitioner to seek appropriate statutory remedy. The appellant/petitioner will be at liberty to challenge the orders of assessments as well as the order of penalty.

Summary

Issues Involved:
- Challenge against assessment orders for various years
- Interpretation of tax rates under SRO No.82/2006
- Applicability of specific tax rates to certain articles
- Validity of penalty orders based on classification of goods

Analysis:
1. The judgment involves multiple writ petitions challenging assessment orders and penalty imposition for different years. The primary issue revolves around the interpretation of tax rates specified in SRO No.82/2006, particularly focusing on whether specific articles are liable to be taxed at the rate stipulated in Sl. No.101 of the notification.

2. The contention raised by the appellant/petitioner is that the articles in question should be taxed at a lower rate based on their classification under the Kerala Value Added Tax Act, 2003. Specifically, the dispute centers on whether the articles fall under the purview of entry 3 (2) of schedule III of the KVAT Act, which mandates a lower tax rate, as opposed to the rate specified under Sl. No.101 of SRO No.82/2006.

3. The appellant/petitioner relies on clarifications issued by the Commissioner of Commercial Taxes to support their argument regarding the applicable tax rates. Ext.P3 clarifies that certain items are taxable at a lower rate, but a subsequent clarification in Ext.P4 contradicts this by specifying a higher tax rate for similar items. The failure of the Commissioner to provide a clear stance post a court directive raises concerns about the sustainability of the assessments and penalty orders.

4. Previous legal proceedings highlight the complexity of the classification issue, emphasizing the importance of correct determination by the taxing authority. Despite earlier challenges and directives to consider clarifications and legal interpretations, subsequent penalty orders were upheld, leading to further legal battles by the petitioner to contest the classification and tax rates applied to the goods in question.

5. The judgment underscores the necessity for the petitioner to exhaust statutory remedies available under the law by approaching the appropriate appellate authorities to challenge the assessment orders and penalty impositions. The court dismisses the writ appeal and petitions, emphasizing the need for adherence to statutory processes and the resolution of classification disputes through the designated fact-finding authorities.

6. In conclusion, the court grants the appellant/petitioner the liberty to file statutory appeals within a specified period and directs the appellate authorities to consider requests for staying collection and recovery of disputed amounts. This approach aims to facilitate the petitioner in seeking appropriate statutory remedies while emphasizing the importance of following legal procedures in addressing tax classification disputes effectively.