Facts of the Case

Alavi N, a 63-year-old resident of Edakkara, Malappuram District, had applied for the Kerala GST Amnesty Scheme, 2022 (introduced by Circular No. 5/2022 dated 25.03.2022) on 27.08.2022 and was directed to pay a one-time amount of Rs. 1,52,962/- by 27.12.2022. Although he attempted payment on 31.12.2022 through the official Kerala Goods and Service Tax Department website, the transaction failed, with the screenshot recording the reason as “last date is over”. The State Tax Officer, Nilambur, nevertheless proceeded to initiate revenue recovery, issuing notices under Sections 7 and 34 of the Kerala Revenue Recovery Act and finally a sale notice dated 03.07.2020 (Exhibit P8) for recovery of the outstanding dues. Alavi N approached the High Court of Kerala seeking to quash the sale notice and to be permitted to avail the Amnesty Scheme by paying the assessed amount.

Issues Involved

  1. Whether the petitioner's failed payment attempt on 31.12.2022, due to a technical glitch on the department's own portal, could be treated as a genuine attempt to comply with the Amnesty Scheme deadline.
  2. Whether the sale notice (Exhibit P8) issued for revenue recovery could be sustained despite this unresolved payment dispute.
  3. Whether the petitioner should be permitted to make the Amnesty Scheme payment with applicable interest/penalty notwithstanding the technical failure.

Petitioner's Arguments

  • The petitioner had genuinely attempted to pay the Amnesty Scheme amount of Rs. 1,52,962/- on 31.12.2022, the last date, but the department's own payment gateway failed the transaction, as evidenced by the screenshot showing the reason “last date is over”.
  • Since the failure was attributable to the department's website and not to any default by the petitioner, he ought to be permitted to complete the payment under the Amnesty Scheme even after the deadline.
  • The sale notice issued for revenue recovery, without addressing this unresolved payment attempt, was liable to be quashed.

Respondent's Arguments

  • The Government Pleader, on instructions, did not dispute that the petitioner could be permitted to make the payment, and submitted that the petitioner may be directed to appear before the assessing authority to pay the tax amount assessed under the Amnesty Scheme, along with applicable interest and penalty.
  • The assessing authority would communicate the exact amount payable by the petitioner.

Court Order/Findings

  • In an earlier order dated 26.09.2023, the Court had directed the Government Pleader to verify whether the screenshot showing the failed payment on account of “last date is over” was correct, since, if so, it could not be said that the petitioner had made no attempt to comply with the Amnesty Scheme deadline.
  • Accepting the Government Pleader's submission on instructions, the Court disposed of the writ petition with a direction that the petitioner appear before the assessing authority to pay the Amnesty Scheme amount of Rs. 1,52,962/- together with any applicable interest and penalty, within the time frame directed by that authority.
  • The petitioner was granted liberty and directions accordingly, without the Court recording any independent finding on the validity of the sale notice itself.

Important Clarification

  • A taxpayer who can demonstrate, through contemporaneous evidence such as a payment-gateway screenshot, that a bona fide attempt was made to pay an Amnesty Scheme amount before the deadline, but failed due to a technical glitch on the department's own portal, may be permitted to complete the payment even after the scheme's cut-off date.
  • Revenue recovery action initiated while such a genuine payment dispute remains unresolved is vulnerable to challenge, and courts will generally direct that the assessing authority first determine and accept the correct payable amount before recovery proceeds further.

Sections Involved

  • Kerala GST Amnesty Scheme, 2022 (Circular No. 5/2022 dated 25.03.2022) — one-time settlement scheme permitting payment of outstanding SGST dues on concessional terms.
  • Section 7, Kerala Revenue Recovery Act — issuance of demand notice as a precursor to revenue recovery.
  • Section 34, Kerala Revenue Recovery Act — notice preceding attachment/sale of property for recovery of dues.

Decision – In Favour of

This was a disposal with directions rather than a reasoned adjudication on the sale notice's validity. On balance it favours the Assessee, since the petitioner was allowed to make the Amnesty Scheme payment despite having missed the formal deadline, but the Court did not independently rule that the sale notice was illegal; it simply left the matter to be resolved by payment before the assessing authority.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Kerala at Ernakulam
  • Case No.: WP(C) No. 27157 of 2023
  • CNR: Not available
  • Coram: Justice Dinesh Kumar Singh
  • Decision Date: 29 September 2023
  • Disposal Nature: Disposed of with directions

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