2013 (3) TMI 302 - HC - VAT and Sales Tax

Method of computation of the wastage of Extra Neutral Alcohol, stored in different vats - as per petitioner the contents of all the vats should be taken together for computing the percentage of the wastage whereas as pet dept. contents of each vat should be taken separately - as per assessee after the lapse of 23 years from the date of dismissal of the SLP by the Supreme Court, Ext.P5 demand has been raised on the petitioner on 17.4.2003 - petitioner aggrieved by the demand of interest also the contention that certain amounts due to the petitioner from the State has not been adjusted by the respondents - Held that - It is submitted that by Exts. P12, P13, P15 and P16, the petitioner has requested for adjustment of certain further amounts against the demand. Thus the petitioner granted an opportunity to adjudicate that issue once again, but only if the petitioner is prepared to pay the demand as per Ext.P9 in the writ petition with further interest as expeditiously as possible, at any rate, within one month. If the petitioner pays the amounts as directed above, the 1st respondent shall consider Exts. P12, P13, P15 and P16 representations filed by the petitioner and if any amounts are found to be further adjustable, adjustment shall be made and if any amounts are found to be refundable to the petitioner on account of such adjustment, the same shall be refunded to the petitioner.

Summary

Issues:
1. Dispute over computation of wastage of Extra Neutral Alcohol.
2. Demand of interest on principal amount.
3. Adjustment of amounts due to the petitioner.
4. Challenge to the judgment directing payment of interest as per Section 6 of the Revenue Recovery Act.

Analysis:

Issue 1: Dispute over computation of wastage of Extra Neutral Alcohol
The petitioner, a distillery, disputed with the Excise Department on the method of computing wastage of Extra Neutral Alcohol. The petitioner argued for a combined computation of all vats, while the Department insisted on separate vat-wise computation. Previous legal actions were taken by the petitioner, but the dispute resurfaced after 23 years with a demand for payment (Ext.P5). The court acknowledged the petitioner's contention but upheld the State's right to claim reasonable interest for the unpaid amount. The court directed the authorities to reevaluate the amounts due and adjust them as per availability, without provision for interest in the Abkari Act.

Issue 2: Demand of interest on principal amount
The State demanded interest on the principal amount owed by the petitioner, citing non-payment since 1975. The court agreed that the State was entitled to reasonable interest for the delayed payment but directed a reevaluation of the amounts due. The court specified that interest should be as per Section 6 of the Revenue Recovery Act and ordered a fresh demand to be issued accordingly.

Issue 3: Adjustment of amounts due to the petitioner
The petitioner claimed that certain amounts due to them from the State were not adjusted as per the court's judgment. The court granted the petitioner an opportunity to address this issue, provided the petitioner paid the demanded amount promptly. The court instructed the authorities to consider the petitioner's representations for further adjustments and refunds if necessary, upon payment of the directed amount.

Issue 4: Challenge to the judgment directing payment of interest
The petitioner challenged the judgment directing payment of interest as per Section 6 of the Revenue Recovery Act by filing a writ petition. The court considered the interconnected writ appeal and writ petition, dismissing the former. The court disposed of the writ petition by directing the petitioner to pay the demanded amount promptly, allowing for further adjustments and refunds based on subsequent evaluations of the amounts due.

This detailed analysis covers the key issues and outcomes of the legal judgment, addressing the disputes over computation, interest demands, adjustment of amounts, and challenges to the court's directions.