Collection charges cannot be levied when tax dues are paid after notice alone and before any coercive recovery step.

Collection charges under the Kerala Revenue Recovery Act and Rules are not leviable when tax and penalty dues are paid after revenue recovery notice alone and before any coercive step, such as attachment or sale, is taken. The scheme distinguishes mere demand or notice from actual recovery action, and the earlier Division Bench view applied that distinction to bar collection charges where payment followed notice only. A later ruling on notified institutions under Section 71 did not alter that position for Government tax dues paid voluntarily after notice without coercive process. The demand for collection charges was therefore unsustainable.

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Issues: Whether collection charges were leviable on tax and penalty amounts paid by the assessee after receipt of revenue recovery notices, without further coercive recovery steps being taken.

Analysis: The governing scheme of the Kerala Revenue Recovery Act, 1968 and the Kerala Revenue Recovery Rules, 1968 distinguishes between mere issuance of demand notices and coercive recovery steps such as attachment or sale. The earlier Division Bench ruling relied on by the Court had held that collection charges were not recoverable where payment follows only notice under Section 7 or Section 34 and no further recovery action is taken. The later decision concerning notified institutions under Section 71 did not assist the respondents, because that line of authority concerned recovery on behalf of institutions notified under the Act and did not alter the position where Government tax dues are voluntarily paid after notice without any coercive process.

Conclusion: Collection charges were not leviable on the amounts paid by the assessee, as the payments were made after notice and before any coercive recovery steps.

Final Conclusion: The demand for collection charges could not be sustained, and the assessee was entitled to relief.

Ratio Decidendi: Collection charges under the revenue recovery framework are not payable where the amount is voluntarily remitted after notice alone and no coercive recovery step has been undertaken.

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