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2010 (4) TMI 975 - HC - VAT and Sales TaxPenalty order under section 15A(1)(l) of the U.P. Trade Tax Act challenged on the ground of being without jurisdiction, inasmuch as the U.P. Trade Tax Act has been repealed and has ceased to be in existence Held that - No case for interference with the impugned order of penalty dated February 5, 2010 is made out, inasmuch as the U.P. Value Added Tax Act while repealing the U.P. Trade Tax Act keeps alive the old rights, liabilities, privileges, obligations, liability/penalty and the remedies under the repealed enactment. However, the petitioner is at liberty to assail the impugned order in an appropriate statutory forum on the merit. Appeal dismissed.
Issues:
Challenge to order imposing penalty under U.P. Trade Tax Act after its repeal and replacement with U.P. Value Added Tax Act. Analysis: The petitioner challenged an order imposing penalty under the U.P. Trade Tax Act, contending that the Act had been repealed and ceased to exist. The respondents argued that the U.P. Value Added Tax Act replaced the Trade Tax Act, saving liabilities and penalties incurred under the repealed enactment. The court noted that a repeal with a saving clause does not obliterate the previous Act entirely but preserves certain rights and liabilities. The purpose of a saving clause is to prevent a legal vacuum and protect existing rights under the old enactment. The court referred to Section 81 of the U.P. Value Added Tax Act and Section 6 of the U.P. General Clauses Act, emphasizing that the rights, privileges, obligations, and penalties accrued under the repealed Act remain unaffected unless a contrary intention is expressed in the new enactment. The judgment highlighted that the power to impose penalties under the repealed Act could still be exercised under the new Act, rendering the repeal insignificant in this context. Drawing on a similar case involving the A.P. General Sales Tax Act and the A.P. Value Added Tax Act, the court held that rights and liabilities accrued under the repealed Act continue even after the repeal unless a different intention is expressed in the new statute. The court dismissed the petitioner's reliance on a different case, emphasizing that the principle established in the A.P. case applied in the present situation. Regarding the validity of the penalty order, the court noted that the petitioner had a statutory remedy to appeal the decision. Ultimately, the court found no grounds to interfere with the penalty order, as the U.P. Value Added Tax Act preserved old rights, liabilities, and penalties under the repealed enactment. The petitioner was advised to challenge the order through the appropriate statutory forum. Consequently, the writ petition was dismissed for lack of substance.
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