2024 (11) TMI 342 - HC - VAT / Sales Tax

Challenge to orders - Wrongful typing of prayer - no order passed by any authority - HELD THAT - It is not in dispute that the petitioner did not deposit any tax with the authorities of Himachal Pradesh despite the fact that it had been running its buses within its territory and thus, in this manner, it deprived the State of Himachal Pradesh of its legitimate amount of tax. Once that be so, obviously, it would be liable to pay interest, for it is more than settled that a person or authority deprived of use of money to which one is legitimately entitled to has a right to be compensated for the deprivation, which may be called interest, compensation or damages. Reference in this regard can conveniently be made to the Constitution Bench judgment of the Hon ble Supreme Court in SECRETARY, IRRIGATION DEPARTMENT, GOVT. OF ORISSA VERSUS GC. ROY 1991 (12) TMI 268 - SUPREME COURT . The petitioner instead of assailing the orders passed by the authorities below, which are in consonance with the law, should have in fact moved the tax authorities in Punjab for the refund of the tax or a part thereof, that according to it had been paid by inadvertence or if the tax was wrongly paid, recovered or retained, it was there that the petitioner could have concomitantly invoked the doctrine/principles of unjust enrichment, equity, justice and good conscious - Having legally ordered to be recovered, that too, strictly in consonance with the provisions of the PGT Act, any other interpretation would lead to an incongruous conclusion, as the State cannot be deprived of its due share of tax and interest on the belated payment. There are no merit in the petition and the same is accordingly dismissed. 50% of the amount deposited in the Registry of this Court is directed to be refunded to the State on furnishing its account number and the petitioner is directed to deposit the remaining 50% of the interest liability alongwith interest as payable under Section 12-A of the PGT Act if not already deposited in the Registry of this Court within a period of one month from today - petition disposed off.

Summary

Issues:
1. Challenge to orders dated 15.9.2014, 19.10.2014, and 22.3.2000.
2. Dispute over tax assessment and penalty imposition.
3. Interpretation of provisions under the Himachal Pradesh Passenger and Goods Taxation Act, 1955.
4. Liability for interest payment on overdue tax amount.
5. Application of the doctrine of unjust enrichment, equity, and justice.

Analysis:

1. The petitioner sought a writ of certiorari to challenge orders dated 15.9.2014, 19.10.2014, and 22.3.2000. The court noted a discrepancy in the order dated 22.3.2000 as it was not passed by any authority and could not have been challenged in anticipation.

2. The Assessing Authority had assessed the petitioner for the years 1991-92 to 1999-2000, creating an additional demand. The petitioner deposited a portion of the amount due but appealed against the imposition of interest and penalty. The Appellate Authority partially waived the penalty but upheld the interest. The Revision Petition before the Excise & Taxation Commissioner was dismissed on 15.9.2014.

3. The petitioner argued that the tax imposed for the years 1991-92 to 31.12.1999 was a result of inadvertence and mistake. The State contended that the petitioner, despite depositing tax in Punjab, operated buses in Himachal Pradesh, thus liable for tax and interest under the PGT Act.

4. The court held that failure to pay tax in Himachal Pradesh deprived the state of its legitimate revenue, justifying the imposition of interest. The court referred to the provision of Section 12-A of the PGT Act, mandating interest payment on overdue tax amounts.

5. The court emphasized that the petitioner should have pursued refund or recovery of the tax paid in Punjab if it was erroneous. The court rejected the challenge to the imposition of tax and interest, stating it was in accordance with the law. The principles of unjust enrichment, equity, and justice were deemed inapplicable in this context.

6. Ultimately, the court dismissed the petition, directing partial refund to the State and ordering the petitioner to deposit the remaining interest liability within a specified time frame. The judgment upheld the legality of tax and interest recovery under the PGT Act, ensuring the state received its due revenue.