TaxTMI 
TaxTMI 
2009 (2) TMI 886
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.... the Kerala Value Added Tax Act, 2003 (hereinafter called "the Act") is engaged in furniture business. Their business premises was searched by the departmental officers on 6.6.2007. Notice was issued to the appellant on 25.6.2008 under Section 67 pointing out that variation in stock was noticed during inspection and consequently appellant was called upon to file objection against proposal for penalty. Since appellant did not file reply, another notice was issued on 29.8.2008 proposing penalty for attempted evasion of tax for two years. Even though the adjudicating authority is bound to complete adjudication pursuant to search under Section 67 within one year from the date of detection of offence, appellant did not raise any objection of tim....
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.... time. It is also contended that the extension of time to be granted by the Deputy Commissioner should also be within the period of limitation i.e. one year from the date of detection of offence. Even though we do not find any grievance for the appellant against the judgment of the learned Single Judge, we feel the question raised need to be answered by this court because the provisions are new and have not been subject to any judicial interpretation by courts. Besides the abovereferred decision of the Supreme Court, counsel for the appellant has also relied on decision of the Karnataka High Court in Shaw Wallace & Co. Ltd. V. Deputy Commissioner Of Commercial Taxes (1998) 111STC 339. However, on going through the provisions considered in t....
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.... except where the extension of time is granted by the Deputy Commissioner." 3. It is obvious from the above provision that limitation of one year provided for completion of proceedings under Section 67(1) is to be reckoned from the "date of detection of offence". The appellant proceeds to assume that date of detection of offence is the date on which the search was made. We do not think any offence was detected in this case on the date of search. In fact, detection of offence requires verification of physical stock, comparison of the same with the accounts maintained and only when the Inspecting Officer is prima facie satisfied that there is an offence, it could be said that he has detected an offence. In the normal course, on the date of....
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....the verification of accounts need not be the date of detection of offence. During verification, the officer has to evaluate the accounts and compare the same with physical stock and only when he detects offence, he gets jurisdiction to proceed to levy penalty. Even though statute does not require the officer to record detection of offence, initiation of proceedings under Section 67 is sufficient evidence of detection of offence. 4. The next contention raised by the appellant is that the Deputy Commissioner before extending the time is bound to issue notice to the appellant. We do not find anything in the Act to indicate the grounds on which Deputy Commissioner can extend the time for completion of proceedings under Section 67(1). However....