1993 (2) TMI 313 - HC - VAT and Sales Tax

Issues Involved:
1. Legality of demand notices and recovery actions by the Assistant Collector and Excise and Taxation Officer.
2. Applicability of Amritsar Oil Works (Acquisition and Transfer of Undertakings) Act, 1982, on liabilities incurred before the appointed day.
3. Jurisdiction and authority of the Commissioner of Payments under the Act.
4. Overriding effect of the Amritsar Oil Works Act over the Punjab General Sales Tax Act.
5. Requirement of pre-deposit for appeals in tax assessment matters.

Issue-wise Detailed Analysis:

1. Legality of Demand Notices and Recovery Actions:
The respondent, M/s. Hindustan Vegetable Oils Corporation Limited, successfully challenged the notices issued by the Assistant Collector and Excise and Taxation Officer, Amritsar, which required the respondent to appear with various amounts for different assessment years. The non-compliance of these demands would result in warrants of arrest or attachment for recovery. The learned single Judge allowed the writ petitions filed by the respondent, leading to the State of Punjab filing the present appeals under clause X of the Letters Patent Act.

2. Applicability of Amritsar Oil Works Act on Pre-appointed Day Liabilities:
The Amritsar Oil Works (Acquisition and Transfer of Undertakings) Act, 1982, came into effect on October 19, 1982. Section 6 of the Act specifies that liabilities incurred by the Amritsar Sugar Mills Company before the appointed day are enforceable against the company and not against the Central Government or the Government company. The petitioner argued that except for liabilities specified in section 6(2), the Central Government or the Government company is not liable for any liabilities incurred before October 19, 1982.

3. Jurisdiction and Authority of the Commissioner of Payments:
Sections 14, 16, and 17 of the Act outline the role of the Commissioner of Payments in disbursing amounts payable to the Amritsar Sugar Mills Company and prioritizing claims. The learned single Judge concluded that the appellant (State of Punjab) should approach the Commissioner of Payments to satisfy its demand for sales tax and penalty, as provided under the Act.

4. Overriding Effect of the Amritsar Oil Works Act:
Section 21 of the Act states that its provisions shall have effect notwithstanding anything inconsistent in any other law. The learned single Judge rejected the argument that the Act cannot override the Punjab General Sales Tax Act. The Court emphasized that the Central Government had deposited the required amount with the Commissioner of Payments, and the specific provision for satisfying the sales tax claim cannot be disregarded.

5. Requirement of Pre-deposit for Appeals:
In Civil Writ Petition No. 18608 of 1991, the petitioner challenged the requirement of pre-depositing Rs. 27,79,174 to entertain an appeal against the additional demand for the assessment year 1980-81. The Tribunal had directed the petitioner to deposit Rs. 10 lakhs, failing which the appeal would be dismissed. The Court held that if the Letters Patent Appeals by the State are dismissed, the liability to pay tax is not on the petitioner. Consequently, the writ petition was allowed to the extent that the matter should be heard without insisting on the pre-deposit.

Conclusion:
The Letters Patent Appeals filed by the State of Punjab were dismissed. The writ petition was allowed, directing that the matter be heard by the authorities without requiring the pre-deposit of the amount. The judgment emphasized the overriding effect of the Amritsar Oil Works Act and the proper channel for satisfying sales tax claims through the Commissioner of Payments. The appeal was dismissed with no order as to costs.

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