9911796707
TMI Blog2025 (1) TMI 624X X X X Extracts X X X X X X X X Extracts X X X X ..... as a consensus between the assessee and the department on the method of payment of tax by the assessee - while there was an application preferred by the appellant seeking permission from the department to pay tax on compounded basis in accordance with Section 7 of the KGST Act, there was no permission expressly granted by the department within the period of one year for which the permission was sought by the appellant. In terms of offer and acceptance, the offer made by the appellant was never accepted by the department. Further, looking to the conduct of the appellant assessee during the said period, we find that even that does not support a finding that the assessee intended to pay tax on compounded basis since the assessee had admittedly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment based thereon against the assessee. Petition allowed. - HONOURABLE DR. JUSTICE A.K. JAYASANKARAN NAMBIAR AND HONOURABLE MR. JUSTICE K.V. JAYAKUMAR For the Appellant: By Advs. Sri. P. Raghunathan, Smt. M. Shylaja, Sri. Premjit Nagendran, Sri. Rishal. K For the Respondents/Respondents: By Sr. Government Pleader Sri. V.K. Shamsudheen. JUDGMENT DR. A.K. JAYASANKARAN NAMBIAR, J. 1. In this Writ Appeal, the appellant, who is an assessee under the Kerala General Sales Tax Act (hereinafter referred to as the KGST Act ), and runs a Three Star Bar Attached Hotel, impugns the judgment dated 29.11.2023 of a learned Single Judge in WP(C). No. 13264 of 2023. The brief facts necessary for the disposal of the Writ Appeal are as follows: 2. The appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifference between the tax that was paid under S.5 and the tax that would have been payable under S.7 of the Act) through an assessment order passed on 15.03.2023. 4. It is relevant to note at this stage that, with a view to help dealers tide over the difficulties that were faced during the Covid period, the State Government had through a notification reduced the rate of tax applicable to sales of liquor by bar attached hotels from 10% to 5%, and the appellant, who had paid tax under S.5 of the Act, filed an application for refund of the tax paid @10% in the year 2021-22. It was at that stage that Ext.P1 order was passed by the department on the compounding application dated 29.04.2021 preferred by the appellant. It was therefore that on rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant did not act in consonance with the application that he had filed seeking permission to pay tax on compounded basis. On the contrary, the appellant had paid tax, albeit using the wrong form of return, in accordance with Section 5 of the KGST Act. In other words, while the appellant had initially applied for permission to pay tax on compounded basis, on finding that there was no response from the department, it had chosen to pay tax on regular basis and not on compounded basis. It is in the backdrop of the said facts that the appellant now says that when the State Government decided to grant a concession in the rate of tax payable by bar attached hotels from 10% to 5% , there was no justification in denying the said benefit of conces ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the department must formally accept or reject an application for permission to pay tax on compounded basis within a particular time from its receipt. It is also pointed out that whenever there is a short payment of the compounded tax payable by an assessee, the department has a period of four years within which it can detect the short payment of tax, if any, occasioned by an assessee, and to take steps to demand the differential tax payable. On the facts of the instant case, he would submit that since the assessee had filed an application seeking permission to pay tax on compounded basis, and had paid tax at the regular rate through a return that was to be used by dealers seeking permission to pay tax on compounded basis, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant. In terms of offer and acceptance, the offer made by the appellant was never accepted by the department. Further, looking to the conduct of the appellant assessee during the said period, we find that even that does not support a finding that the assessee intended to pay tax on compounded basis since the assessee had admittedly paid the tax in accordance with the provisions of Section 5 of the KGST Act. This is borne out by the figures showing payment of tax, despite the fact that those figures were inserted in a return that was meant to be used by paying tax under Section 7 of the KGST Act. It is also not in dispute that during the relevant assessment year, there was no communication issued to the appellant assessee from the depa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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