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2018 (12) TMI 352
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....r the Kerala Value Added Tax Act, 2003 (for brevity 'the Act'). Two Writ Appeals are by the assessee and the other by the Department. The parties are referred to as the assessee and the Department. 2. The assessee is running a hotel and for the assessment year 2009-10 applied for compounding, for the sales turnover of cooked food, the rate for which in the relevant year was 0.5% of the total turnover. The option exercised for compounding was accepted by the Department and the assessee started payment on the basis of the compounding permission granted by the Department. 3. On 19.8.2009, the assessee obtained a licence for a beer and wine parlour. Section 8(c) of the Act provided for an option of compounding to any dealer in cooked ....
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....ure of the Department to cancel the permission granted for compounding under Section 8(c). It was argued that without cancellation of the said option, the Department could not have resiled from the binding contract entered into between the Department and the assessee. The assessee also filed a Writ Petition against the compounding fee levied alleging that the assessee was coerced into agreeing for the compounding of the offence and the said writ petition was numbered as WP(C) No.26068/2015. 5. The learned Single Judge considered both the issues together. On the question of coercion, the learned Single Judge found that, the assessee having paid up the amounts cannot now turn around and allege coercion by the Department to accept the compoun....
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....f the statutory provision being ultra-vires. The learned Senior Government Pleader urged that the question be left to the Tribunal to be considered on the issue of limitation. Insofar as the penalty, the learned Senior Government Pleader points out that when the application for compounding was filed, there was an amendment to Section 74 enhancing the maximum compounding fee to Rs. 8 lakhs. The maximum compounding fee as it stood under Section 74(1)(a) was Rs. 2 lakhs. By Finance Act, 2009 with effect from 01.04.2009 this was enhanced to Rs. 4 lakhs. A further enahacement was made substituting the words 'Rs.4 lakhs' with 'Rs.8 lakhs' by an amendment in the Kerala Finance Act, 2011 w.e.f. 19.7.2011. The application for compoun....
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....ximum compounding fee collectable against the single offence spread over several return periods in a financial year shall be two lakh rupees. We see that, even now, the statute in the various texts available before us shows the amount as Rs. 2 lakhs in the proviso. However, we have to look at the amendment to understand as to the substitution made. We have looked at the Kerala Finance Act, 2009 and this is the specific amendment seen therefrom:- "(22) in section 74, in sub-section (1), for the words 'two lakhs', the words 'four lakhs' shall be substituted." 9. The words 'two lakhs' have been substituted with the words 'four lakhs' and the substitution should be to all places in sub-section (1). Hence, in ....
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....t and remitted by the assessee would stand sustained. 11. Now we come to W.A.No.2557/2015, wherein the assessee has challenged the regular assessment made on the assessee being dis-entitled to continue the compounding under Section 8(c) due to the commencement of the beer and wine parlour. We are not convinced that the assessee could take a contention that there should be a cancellation first effected before the regular assessment is made. On the assessee obtaining a beer and wine parlour licence and commencing the sale, the entitlement to continue compounding under Section 8(c) automatically stands extinguished. There is absolutely no requirement of cancellation first before a regular assessment is taken up. We reject the contention so ra....