IN THE HIGH COURT OF KERALA AT ERNAKULAM
WA.No. 1390 of 2003()
1. STATE OF KERALA REP.BY ITS CHIEF
... Petitioner
2. SALES TAX OFFICER,IVTH CIRCLE,
Vs
1. KAMADHENU MILK PRODUCTS, ERNAKULAM,
... Respondent
2. GEORGE PAUL S/O. PAUL MATHEW,
3. GEORGE VETTATH, S/O. GEORGE V.JOHN,
4. K.M.STEPHEN S/O. MATHEW, KOTTACKAL HOUSE
For Petitioner :GOVERNMENT PLEADER
For Respondent :SRI.R.MURALEEDHARAN (AROOR)
The Hon'ble MR. Justice J.B.KOSHY
The Hon'ble MR. Justice P.N.RAVINDRAN
Dated :02/06/2008
O R D E R
J.B. Koshy & P.N.Ravindran, JJ.
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W.A. No. 1390 of 2003
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Dated this the 2nd day of June, 2008
Judgment
Koshy,J.
Writ petitioner is a dealer in pasteurised milk. It claimed
sales-tax exemption granted to ‘fresh milk’. The activity done by
the petitioner was to add skimmed milk powder to fresh milk to
achieve the solid non-fat content and main share of their product is
fresh milk and milk powder is added only to a limited quantity to
achieve the standards for the milk in accordance with Food
Adulteration Act. The officer accepted the assessments and return
under section 17 (4). Later, in view of the decision of this court in
Ernakulam Regional Co-op. Milk Producers Union Ltd. v. State of
Kerala ((2001) 9 KTR 459 (Ker.), the assessment was re-opened and
assessed an amount of tax of Rs.1,81,03,271/- at the rate of 10%
on the milk sold by the petitioner. Petitioner paid the tax due with
interest. The question is whether petitioner is entitled to be
charged with penalty also.
2. With regard to the non-applicability of exemption, the
learned single Judge held that the appellant is not entitled to
W.A.No. 1390/2003 2
exemption as claimed, but, at the same time, noticed as follows:
“…..This is a case where the Government
has granted exemption on toned milk items with
effect from 1.1.2000. Further by retrospective
amendment the Government has granted
exemption to co-operative societies and Kerala
Milk Marketing Federation Ltd. Even though this
Court has upheld the said notification as not
discriminatory, it will be absolutely harsh to levy
penalty on the petitioners especially when the
Government granted exemption on the item
later. The question is whether the petitioner is
entitled to exemption or not. The officer himself
first accepted the claim of exemption, and later
reversed the finding.”
There is no intended evasion considering the totality of
circumstances. The learned single Judge held that penalty should
not be issued under section 17 (5A) even though tax liability was
upheld. We are of the opinion that no interference is required in the
above finding on the facts of this case. The appeal is dismissed.
J.B.Koshy
Judge
P.N.Ravindran
Judge
vaa
W.A.No. 1390/2003 3
W.A.No. 1390/2003 4
J.B. KOSHY
AND
P.N.RAVINDRAN,JJ.
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W.A. No. 1390 of 2003
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Judgment
Dated:2nd June, 2008