TMI Blog2018 (12) TMI 352X X X X Extracts X X X X X X X X Extracts X X X X ..... nying the Department the right to make any revision of the compounding fee which already has been accepted by the assessee and amounts paid. Disentitlemnet of 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 - Held 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee 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 food and beverages, but however prohibited it inter alia for a bar attached hotel or a dealer serving cooked food in a bar attached hotel. Hence, from the date on which the assessee obtained a licence for running a beer and wine parlour and also commenced it, there could have been no payment of tax as per the compounding allowed by the Department. The assessee failed to reveal the same to the Department and switch over to regular assessment. The learned counsel for the assessee has a c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 compounding of the offence. However, the learned Single Judge looked into the provisions for compounding of an offence under Section 74 of the Act and found that only ₹ 2 lakhs could have been imposed. The learned Single Judge also found that the differential compounding fee claimed enhancing it to ₹ 8 lakhs could not have been claimed by the Department. On the regular assessment taken up, the learned Single Judge left the remedy of the assessee to challenge the same b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 2 lakhs. By Finance Act, 2009 with effect from 01.04.2009 this was enhanced to ₹ 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 compounding was filed in the year 2014 and hence compounding fee would be ₹ 8 lakhs is the argument. 7. On the question of compounding fee, we have to notice the various amendments brought in as also the date of application. As was pointed out, initially, the maximum compounding fee was ₹ 2 lakhs; then enhanced to ₹ 4 lakhs and eventually to ₹ 8 lakhs. The application filed was also after the enhancement to ₹ 8 lakhs as seen f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pecific 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 sub-clause (a) as also in its proviso, the amount would stand substituted to 4 lakhs. We agree with the learned Single Judge that there could have been no allegation raised that the compounding of the offence was on coercion of the Department. The assessee had not only made an application, but had also remitted the amounts demanded by the Department. We, hence, reject WA No.2605/2015 and allow the appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 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 raised. 12. Be that as it may, the assessee has a further contention; not raised as a ground in the appeals or the writ petitions, which is on limitation. Limitation raises mixed questions of fact and law. But in the present case, there is no dispute on facts. The relevant facts are only the subject assessment year as also the date on which the Department initiated proceedings to dete ..... X X X X Extracts X X X X X X X X Extracts X X X X
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