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M/S.TREAD AND INDUSTRIAL RUBBER v. SALES TAX OFFICER, VAIKOM - OP No. 37618 of 2002(C)  RD-KL 17401 (17 September 2007)
IN THE HIGH COURT OF KERALA AT ERNAKULAMOP No. 37618 of 2002(C)
1. M/S.TREAD AND INDUSTRIAL RUBBER
1. SALES TAX OFFICER, VAIKOM.
2. COMMISSIONER OF COMMERCIAL TAXES,
For Petitioner :DR.K.B.MUHAMED KUTTY (SR.)
For Respondent :GOVERNMENT PLEADER
The Hon'ble MR. Justice C.N.RAMACHANDRAN NAIR
O R D E R
C.N.RAMACHANDRAN NAIR, J.O.P. No. 37618 of 2002
Dated, this the 17th day of September, 2007
J U D G M E N T
Heard learned Senior counsel appearing for the petitioner and learned Government Pleader. The order under challenge is penalty levied under Section 45A of the KGST Act, which is modified in first revision and confirmed in second revision. Petitioner-industrial unit purchased raw materials by availing concessional rate under Section 5(3) of the KGST Act. However, contrary requirement of the provision that is sale of the product and payment of tax, petitioner stock transferred the same to outside the State. The violation was therefore admitted and penalty was imposed. Even though learned counsel for the petitioner submitted that differential tax was paid by the petitioner, it is seen that petitioner has made notional payment by adjustment against exemption available. In any case, I find penalty is reduced in first revision to equal the amount of tax for the item stock transferred and the penalty is levied after two years of availing concession, which means State has lost interest on differential tax for two years. In the circumstances and since penalty levied is only equal the amount of tax, which is WP(C) No. 37618/2002 compensatory in nature, there is no scope for interference and this original petition is accordingly dismissed. However, there will be direction to the respondents to waive 50% of the interest payable on the penalty amount, if balance penalty is paid on or before 31/10/2007.
(C.N.RAMACHANDRAN NAIR, JUDGE.)jg
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