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TMI Blog2017 (7) TMI 581X X X X Extracts X X X X X X X X Extracts X X X X ..... y carried on the business under a partnership firm that was constituted along with his wife. The said partnership firm is the petitioner in W.P.(C).No.33522 of 2016. The petitioner in W.P. (C).No.24958 of 2015 obtained registration under the Kerala Value Added Tax Act (hereinafter referred to as the 'KVAT Act) as a proprietor for doing business in jewellery. The registration was obtained in October, 2013. Since the petitioner did not have any business in the opening months, he filed nil returns with the respondents during the said period. It would appear that, in December 2013, he purchased gold bullion under cover of Exts.P1 and P1(a) invoices but omitted to declare the same in the returns filed for December, 2013. Subsequently, inasmu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d purchase suppression detected. By a separate notice (Ext.P3(a)), a penalty was also proposed on the petitioner, for the reasons stated in the notice issued in connection with the assessee. Although the petitioner submitted a common reply, through Exts.P5 and P5(a) orders, the assessment and penalty proceedings were completed against the petitioner by bringing to tax an exorbitant turnover attributable to the alleged suppressed purchase turnover of gold bullion, and also by imposing a penalty commensurate with the escaped turnover that was assessed. In W.P.(C).Nos.24958 of 2015, the petitioner impugns Exts.P5 assessment order and Ext.P5(a) penalty order, inter alia, on the ground that, there was no justification for the respondents to comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed on behalf of the partnership firm, and sought permission to revise the returns accordingly. The said request was denied by the Assessing authority by Ext.P3 communication dated 14.10.2015. Immediately thereafter, the assessing authority issued Exts.P4 and P4(a) notices proposing the completion of assessment and the imposition of a penalty on the petitioner for the alleged act of suppression of purchase turnover. Although the petitioner preferred a detailed reply to the said notices, the assessment was completed against the petitioner by making an estimation on the basis of the purchase turnover suppressed and demanding a differential tax from the petitioner. By Ext.P6 (a) order, a penalty was also imposed on the petitioner, equal to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irm the assessment against the petitioner solely on the ground that, the opportunity to revise the returns could not have been extended to an assessee, who had cancelled his registration with regard to the business concern before making the application for revising of the returns. In my view, the said finding of the Assessing Officer is legally untenable since, notwithstanding the cancellation of the registration of the petitioner, the petitioner was under an obligation to file the necessary returns for the period during which he carried on business, and the KVAT Act also contemplates an assessment of the petitioner during the period when he was carrying on business. Inasmuch as the revision in the return that was sought for by the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion or misrepresentation by the assesse necessitating the imposition of a penalty for the said assessment year. I, therefore quash P5 (a) penalty order that is impugned in the writ petition. 6. As regards W.P.(C).No.33522 of 2016, I find that, the partnership firm, which is the assesse in the said writ petition, comprised of the petitioner in W.P.(C).No.24958 of 2015 and his wife. The petitioner in W.P.(C).No.24958 of 2015, who realised the discrepancy with regard to the non-inclusion of the purchase turnover in December 2013, and subsequently brought forth the said purchase turnover as the opening stock of the business of the partnership firm, did not seek to include the said purchase turnover in the returns for the opening months after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reme Court in Sree Krishna Electricals v. State of Tamil Nadu and Another ([2009] 23 VST 249 (SC)), where the items that were allegedly suppressed were found incorporated in the books of accounts of the assessee, the mere fact that the assessee had not included them in the turnover declared in the return, cannot be a ground for imposition of a penalty. In the instant case also, it is not in dispute that the purchase turnover of the bullion aforementioned had been included in the books of accounts of the petitioner firm and in fact it was shown as forming part of the original stock of the petitioner firm. The irregularity occasioned by the petitioner firm, was in not declaring the purchase turnover in the returns that were filed for the purp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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