Stay Order passed by KVAT Tribunal Requiring Deposit of 20% of Tax, Kerala HC dismisses Writ Petition Citing No Jurisdictional issues or Abuse of Process [Read Order]

The High Court of Kerala has dismissed a writ petition challenging the Stay Order passed by the Kerala Value Added Tax (KVAT) Appellate Tribunal requiring the deposit of 20% of the tax demand on the observation that there is no jurisdictional issues or abuse of process on the part of the Tribunal. The writ petition was filed by Shafeer U. H., proprietor of M/S. Nafeesa Wood Products, Perumbavoor challenging a common stay order issued by the KVAT Appellate Tribunal, which mandated the deposit of 20% of the existing tax demand within one month. The petitioner, represented by Sri. N. Muraleedharan Nair and Sri. Antony Jones, contested the stay order, arguing that it was unfair and sought a direction for the expeditious disposal of related exhibits.

The respondent revenue, the State Tax Officer-I, the KVAT Appellate Tribunal and the Deputy Commissioner of the State Goods and Services Tax (SGST) Department were represented by Smt. Reshmita Ramachandran. The respondent revenue asserted that the petitioner failed to show any jurisdictional flaws or abuse of legal process in the KVAT Appellate Tribunal’s order. Emphasising the petitioner’s non-compliance, they argued that the court should uphold the decision of the Tribunal considering it as a necessary measure to safeguard the interest of the revenue.

The order passed by the Tribunal required the petitioner to deposit 20% of the existing tax demand for all the petitions and execute a simple bond for the remaining amount within one month from the date of receipt of the order. However, instead of complying with the interim order, the petitioner approached the Kerala High Court through a writ petition. The bench noted that the petitioner had failed to demonstrate that the order in question was without jurisdiction or an abuse of the process of law. The court found no substance in the writ petition and consequently dismissed it. The bench highlighted that the petitioner had an opportunity to comply with the interim order but chose to challenge it before the High Court instead. The court emphasised that the petitioner’s failure to demonstrate any jurisdictional issues or abuse of the legal process weakened the grounds for the writ petition.

The dismissal of the writ petition implies that the stay order issued by the KVAT Appellate Tribunal, which required the petitioner to deposit 20% of the tax demand within one month, stands. The bench highlighted the importance of adhering to legal procedures, statutory remedies and fulfilling regulatory requirements rather than seeking judicial intervention without substantial grounds. The single bench of Justice Dinesh Kumar Singh dismissed the writ petition and clarified that the judiciary cannot intervene in such matters without clear evidence of jurisdictional issues or an abuse of legal procedures.

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