Voluntary election to compounded tax binds an assessee once accepted, barring later withdrawal after demand is issued.

A dealer who voluntarily elected to pay tax under the compounded scheme under the Kerala General Sales Tax Act and obtained approval could not later withdraw that choice after the authority issued demand on the compounded basis. The Court treated the option as an alternative statutory mode of taxation that, once accepted and acted upon, bound the assessee for so long as the scheme remained operative. The later enhancement of the compounding rate for a subsequent year did not by itself permit resiling from the earlier election. The demand raised under the compounded rate was therefore held valid and binding.

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Issues: Whether an assessee who had voluntarily opted for payment of tax at the compounded rate under the Kerala General Sales Tax Act, 1963 could later withdraw that option after the demand for the higher compounded tax for the relevant year was issued.

Analysis: The option under section 7(1)(a) was an alternative method of taxation available to eligible dealers who elected to be governed by it. The assessee had applied in the prescribed form, obtained permission, and enjoyed the benefit of the compounded scheme for earlier years. Once the competent authority had accepted the option and acted upon it by issuing a demand under rule 30, the assessee could not resile from the election merely because the compounding rate for the subsequent year stood enhanced. The Court applied the principle that a voluntary election to adopt an alternative statutory mode of taxation binds the assessee so long as the scheme remains operative and accepted.

Conclusion: The assessee was not entitled to withdraw from the compounding scheme after the demand notice, and the demand raised under the compounded rate was valid and binding.

Final Conclusion: The writ appeal failed because the assessee remained bound by the earlier statutory election to pay tax at the compounded rate.

Ratio Decidendi: A dealer who voluntarily opts for an alternative statutory method of taxation and obtains its benefit cannot later withdraw from that option after the authority has accepted and acted upon it, unless the statute expressly permits such withdrawal.

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