KARNAKI IMPEX Vs. INTELLIGENCE INSPECTOR

JUDGEMENT

(1.) Timber logs, Timber swan sizes, and Panel Doors Hardwood transported from Cochin Port to the business place of the petitioner at Karunagappally was intercepted by the respondent, on issuing Ext.P5 notice under Section 47(2) of the Kerala Value Added Tax Act (KVAT Act). According to the petitioner the goods in question were imported from Gujarat through coastal port at Cochin and it was transported on the strength of Departmental Delivery Note, Form 8FA Declaration, Invoices, Bill of Entry, and Certificate evidencing payment of Advance Tax. The goods were detained for the reason that, on verification it was revealed that, neither the consignor nor the consignee had declared the species of timber and it was also revealed that the timber transported are imported "Mirandi" timber logs. The respondent, on the basis of enquiry conducted, realised that the market value of the goods is far above than the value declared and suspecting wilful undervaluation with an intention of evading tax, the goods were detained and security deposit was demanded to the tune of double the amount of tax on the differential value calculated.

(2.) According to learned counsel for the petitioner, there was no undervaluation as alleged and the value as revealed in the Bill of Entry was truly reflected in the documents which accompanied the transport. Learned Government Pleader on the other hand contended that, there was a misclassification of the goods and the gross variation in value when compared with the market value, gives rise to a reasonable suspicion regarding attempt in evasion of payment of tax.

(3.) I am of the considered opinion that the issue need not be decided in this writ petition, as the detention will be followed by an enquiry contemplated under Section 47. But pending finalisation of such enquiry, the goods can be released on the petitioner furnishing proper security.