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1994 (12) TMI 295 - HC - VAT and Sales Tax
Issues: Interpretation of section 23(2) of the Rajasthan Sales Tax Act, 1954 regarding the payment of interest on refunds, validity of circulars issued by the Commissioner of Commercial Taxes Department, and calculation of interest from the date of deposit.
Analysis: The petitioner, an assessee for commercial taxes, sought interest on a refund as per section 23(2) of the Act. The Assistant Commercial Taxes Officer directed a refund of Rs. 1,54,086 and granted interest at 12% per annum from August 9, 1990 to March 31, 1992, and at 15% from April 1, 1992. The petitioner challenged this decision, arguing that circulars issued by the Commissioner were not in line with the Act and that interest should be paid from the date of deposit till the refund. The respondents contended that interest was payable only from August 9, 1990, after the amendment to section 23(2) of the Act. The main contention revolved around the interpretation of sub-section (2) of section 23, which mandates interest on the refund amount from the date of deposit. The Court analyzed section 23 of the Act, emphasizing that interest on refunds is to be paid from the date of deposit, as stated in sub-section (2). The Court applied the principle that statutory words should be given their ordinary meaning unless context demands otherwise. It concluded that interest is payable from the date of deposit, irrespective of the period the amount remains deposited. The Court highlighted that the circulars issued were not in line with the Act and, therefore, not enforceable. Consequently, the Court quashed the circulars and the order directing interest calculation from a specific date, remanding the matter for a fresh decision in accordance with the law. In summary, the judgment clarified the interpretation of section 23(2) of the Act, emphasizing that interest on refunds should be paid from the date of deposit. It invalidated circulars not in conformity with the law and directed a fresh decision on interest calculation.
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