1995 (1) TMI 374 - HC - VAT and Sales Tax

Summary

Issues:
1. Challenge to penalties imposed under Bihar Finance Act, 1981.
2. Challenge to validity of rule 33(8)(a) of the Bihar Sales Tax Rules, 1983.
3. Imposition of penalties without hearing the petitioner under section 16(9) of the Act.
4. Dismissal of revision applications by Commercial Taxes Tribunal.
5. Appeal against penalties imposed and confirmed by appellate authority.

Detailed Analysis:
1. The petitioner, a private limited company, challenged penalties imposed under section 25(3) of the Bihar Finance Act, 1981, and section 16(9) of the Act. The petitioner contested the penalties for non-payment of sales tax "surcharge" in time and questioned the validity of rule 33(8)(a) of the Bihar Sales Tax Rules, 1983. The petitioner's case revolved around the imposition of penalties and the subsequent revisional orders by the Bihar Commercial Taxes Tribunal.

2. The petitioner's history of legal challenges regarding the sales tax "surcharge" included filing writ petitions against the validity of section 5 of the Act, which were ultimately dismissed by the High Court and the Supreme Court. The petitioner sought to pay the tax by instalments after the stay was vacated, leading to further disputes and penalties imposed by the authorities.

3. The petitioner raised concerns about penalties imposed under section 16(9) of the Act without a proper hearing. The petitioner argued that penalties were imposed without considering reasonable causes for delayed payments, which included court stays and agreements for instalment payments. The petitioner contended that penalties were unjustly confirmed by the appellate authority.

4. The Commercial Taxes Tribunal dismissed the petitioner's revision applications, with the Chairman dismissing them while the other Member allowed the revisions, citing a difference in opinion. The absence of a third Member led to the dismissal of the revisions as per the proviso to rule 33(8)(a) of the Rules.

5. The High Court, after considering the merits of the petitioner's case, upheld the argument that there was a reasonable cause for delayed payment of the sales tax "surcharge" by instalments. The Court found in favor of the petitioner, quashing the impugned orders of penalties and the dismissal of revision applications. The writ petitions were allowed, with no order as to costs.

This detailed analysis covers the various legal issues and the Court's findings in the judgment.