WP(C)/35297/2011 of M/S.WIPRO GE HEALTHCARE PVT.LTD. Vs THE COMMERCIAL TAX INSPECTOR, WALAYAR on 30 December 2011

JUDGMENT

The petitioners are stated as aggrieved of detention of themachinery, more particularly, described as 'C.T. scanner' at the checkpost, leading to issuance of Ext. P5 notice under Section 47 (2) of theKVAT Act, doubting evasion of tax and demanding security deposit tothe extent as stipulated therein. The reasons for detention are asgiven below:

“The consignee is not a registered dealer in Kerala UnderKVAT Act 2003. As per purchase order two clausesincluded 1) price includes cost of the equipment applicablecurrent customs duty/excise duty freight and insurance tosite, applicable sales tax, erection commissioning and oneyear warrantee to the CT 2) Comprehensive AMCincluding sale @ 14 lakhs with 5 % escalating year afteryear from previous year amount. Hence elements ofsupply installation and after service and AMC in thistransaction; which attracts tax on works contract. Henceevasion of tax suspected and demanded.

2. The case of the petitioners is, that there is absolutely no rationale on the part of the respondent for having detained the vehicleand the goods, more so when, exactly in respect of similar interception, : 2 :

the first petitioner had approached this Court earlier by filing W.P.(C)No. 19474 of 2010, W.P.(C) Nos. 26975 of 2011 and W.P(C) No.27187 of 2011, when the adjudication proceedings were directed to befinalized, permitting the petitioner to have the goods released, onexecution of 'simple bonds'.

3. The learned counsel for the petitioners submits that, pursuantto Ext. P10 judgment, the adjudication proceedings were finalized bythe concerned authority, as borne by Ext. P11 order dated 06.09.2010,whereby the contention raised by the petitioner was accepted and thesecurity deposit has been released. In spite of the said proceedings,the respondent continued to pursue similar course and events, whichmade the first petitioner and another to approach this Court again, inrespect of another transaction, by filing W.P.(C) No. 27187 of 2011,which was disposed of, as per Ext. P8 judgment directing theadjudicating authority to have the proceedings finalized, however,enabling the petitioners to have the goods released on execution of a'simple bond'. It is stated that the adjudication proceedings are stillpending. In spite of bringing the above factual position to the notice ofthe respondent, the goods brought by the petitioners have been : 3 :

detained as per Ext. P5, which in turn is under challenge in this writpetition.

4. Heard the learned Government Pleader as well, who submitsthat, there is some difference in the present transaction. The learnedGovernment Pleader refers to Ext. P2, wherein it is stipulated that theprice includes cost of the equipment, applicable current customsduty/excise duty, freight and insurance to site, applicable sales tax,erection, commissioning and one year warranty for the C.T., whichinevitably includes the element of 'work contract' as well, which istaxable. It is further submitted that the second petitioner is not aregistered dealer.

5. The learned counsel for the petitioner further submits that thetransaction was exactly similar as in the earlier case and that theadjudicating authority itself got satisfied over the same, which hasresulted in Ext. P11 order. As such, the fate of the present case alsocannot be something else; submits the learned counsel.

6. After considering the materials on record and also afterhearing both the sides, this Court finds that the matter, in view of thedisputed questions of facts, however, has to be finalized by the : 4 :

adjudicating authority. But it is not required to have the goods retainedtill the adjudication proceedings are over. In the said circumstances,this Court finds it fit and proper to have the goods released, onexecuting a 'simple bond' by both the petitioners, as already ordered bythis Court vide Exts. P8, P9 and P10. It is ordered accordingly. Therespondent is directed to cause the adjudication proceedings to befinalized in accordance with law, as expeditiously as possible, at anyrate, within two months from the date receipt of a copy of this judgment.The Writ Petition is disposed of.

Sd/-

P. R. RAMACHANDRA MENON, JUDGE

kmd