Case Law Details
Sakthi Agencies Vs The Assistant Commissioner (Kerala High Court)
KVAT Act – Amnesty Application does not warrant automatic Dismissal of Appeal – Kerala High Court Single Bench – on 5th November 2021
Kochi: In a first of its kind judgement in Kerala, a Single Bench of the High Court of Kerala presided over by Justice Bechu Kurian Thomas held that applying under an amnesty scheme will not render the appeal filed by an assessee to be deemed to be dismissed.
The judgement was passed on the 5th of November 2021, in Sakthi Agencies v. Assistant Commissioner & Anr. [W.P.(C) No. 13611 of 2021]. The petitioner was represented by Advocate K.S.Hariharan & Associates.
The petitioner had filed Application under Kerala VAT Amnesty Scheme while the appeal filed by them was pending for disposal. The Appellate Authority, upon finding from KVATIS that the petitioner had opted for the Amnesty Scheme, unilaterally dismissed the appeal holding the appeal as “deemed withdrawn”, citing the reason that one of the pre-conditions to avail Amnesty was withdrawal of appeals. Meanwhile the Amnesty Scheme also expired due to non-payment of the Amnesty settlement amount by the petitioner.
Setting aside the Appellate Authority’s dismissal order, the High Court held that “The reasoning given by the Appellate Authority is ex facie perverse. If the condition for opting for the amnesty scheme or applying for the amnesty scheme is withdrawal of the appeal and if the appeal was not withdrawn, then the same should have only rendered the application for amnesty scheme to be dismissed and not vice versa. Applying under the amnesty scheme will not render the appeal filed by the assessee to be deemed to be dismissed by any stretch of imagination.”
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
Faced with an assessment order under Section 25(1) of the Kerala Value Added Tax Act (for short, ‘the KVAT Act’) for the assessment year 2015-16, petitioner preferred an appeal before the Appellate Authority. While the appeal was pending, a scheme for amnesty was introduced by the Government in the year 2020. One of the conditions of eligibility for obtaining the benefit of the amnesty was to withdraw all the pending appeals.
2. Desirous of taking the benefit of amnesty scheme, petitioner filed an application under the scheme and awaited the calculation of tax liability. The application for registration claiming the benefit of amnesty scheme is liable to be filed in the tax amnesty portal. Even after resorting to such an application, there was no response from the department. However, on noticing that petitioner had filed an amnesty application, as revealed from the KVATIS portal, the Appellate Authority unilaterally by the impugned order dismissed the appeal for default, reasoning that since the petitioner had opted for the amnesty scheme, it was liable to withdraw the pending appeals and that by virtue of its very application for benefit of the amnesty scheme, it ought to be deemed that petitioner has withdrawn the appeal. The aforesaid order is challenged by the petitioner stating that petitioner had neither withdrawn the appeal nor had the petitioner been granted the benefit under the amnesty scheme and now he is left with no remedy and in the lurch.
3. A perusal of the order impugned shows that the appeal was dismissed for default and also that the Appellate Authority had, by itself, verified the KVATIS amnesty module and learnt that petitioner had opted for the amnesty scheme which obligated him to withdraw the pending appeal. It was further observed in Ext.P4 that, since petitioner had opted for the amnesty scheme, it should be deemed that it had withdrawn the appeal pending before the Appellate Authority. On that basis it was concluded that there was no need to proceed with the appeal and the same merits a dismissal for default.
4. The reasoning given by the Appellate Authority is ex facie perverse. If the condition for opting for the amnesty scheme or applying for the amnesty scheme is withdrawal of the appeal and if the appeal was not withdrawn, then the same should have only rendered the application for amnesty scheme to be dismissed and not vice versa. Applying under the amnesty scheme will not render the appeal filed by the assessee to be deemed to be dismissed by any stretch of imagination. It is also noteworthy to mention that petitioner claims to have not obtained approval of the benefit of the amnesty scheme also.
5. In the above circumstances, dismissal of the appeal filed by the petitioner for the assessment year 2015-16 by order dated 29.03.2021, a copy of which is produced as Ext.P4 is liable to be interfered with.
In view of the above, Ext.P4 is set aside. The Appellate Authority is directed to take the appeal filed by the petitioner back on its files relating to the assessment year 2015-16 and pass fresh orders on the appeal after hearing the petitioner.
The writ petition is allowed as above.
****
Author: Adv. Harima Hariharan,
