9911796707
TMI Blog1982 (9) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... certain sums towards the assessed tax on 1st June, 1973, and 25th July, 1973. The outstanding balance of Rs. 1,05,000 was paid by the petitioner in December, 1976, and January, 1977. In respect of the assessment year 1969-70 the Sales Tax Officer, Allahabad, passed an assessment order on 29th March, 1974, under section 9 of the Central Sales Tax Act and determined the sales tax at Rs. 2,21,899.68. This tax was in respect of the six branches of the petitioner. The Commissioner of Sales Tax by his order dated 22nd December, 1972, had transferred the pending cases of the petitioner to the Sales Tax Officer, Allahabad, and consequently, the Sales Tax Officer had made the assessment. The petitioner filed Writ Petition No. 2278 of 1974 and challenged the validity of the assessment order dated 29th March, 1974. This writ petition was allowed in part by this Court on 8th October, 1974, and the Sales Tax Officer was directed to modify the assessment order. In compliance with this order the Sales Tax Officer determined the total taxable turnover and the amount of tax by his order dated 1st September, 1976. He fixed the amount of tax at Rs. 1 50,831.61. A copy of this order was served on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Act No. 103 of 1976), with retrospective effect, and charging of interest on the assessed tax in accordance with the provisions of the State law, was validated. This has been held by a Division Bench of this Court in Hira Lal Jain Co. v. Sales Tax Officer [1982] 50 STC 85; 1981 ATJ 416. We are in respectful agreement with this view. This plea of the petitioner is overruled. First we take up the claim for interest in respect of the assessment year 1968-69. The facts are not in dispute. The petitioner had paid a portion of the tax assessed within the time prescribed by law. The recovery of the remaining amount appears to have been stayed by an order passed in the appeal which was preferred by the petitioner. After the dismissal of the appeal, the balance was paid in the months of December, 1976, and January, 1977. A new sub-section (2) was inserted in section 8 of the U.P. Sales Tax Act by the U.P. Sales Tax (Amendment) Act, 1973. The sub-section was as under: "(2) Where realisation of any tax remained stayed by any order of any court or authority and such order of stay is subsequently vacated, the interest referred to in sub-section (1-A) shall be payable also for any period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt which was not paid within the time prescribed by law from the date of service of the notice of demand, namely, 18th April, 1973, is legally well-founded. The learned counsel for the petitioner has not challenged the correctness of the amount of interest. Thus this petition in regard to the claim for interest for the assessment year 1968-69 has no merit and must fail. Now, we turn to the claim for interest for the assessment year 1969-70. The learned counsel for the petitioner has referred to a Division Bench decision of this Court reported as Hukam Chand v. State of U.P. 1974 UPTC 317 (printed at page 43 infra.) He has urged that in that case also there was a reduction in the amount of the tax assessed. The Sales Tax Officer had claimed penal interest notwithstanding the fact that the amount was paid within 30 days from the date of the service of the rectification order. The demand for interest was quashed by the High Court. This decision is distinguishable. The Sales Tax Officer had determined the tax at a certain amount, but later on, by an order of rectification, he reduced that amount. In the rectification order, 30 days' time was specifically granted for payment of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f enhancement, and therefore took the view that a fresh notice of demand was necessary. The instant case is admittedly one where the tax assessed was reduced in pursuance of the order of this Court passed in writ jurisdiction. Thus, even according to the view taken in Parshuram's case [1974] 33 STC 540; 1974 UPTC 65, it was no longer necessary to issue a fresh notice of demand in the instant case. The decision relied upon by the learned counsel cannot help him. The learned counsel for the petitioner has next urged that in Writ Petition No. 2278 of 1974 this Court had quashed a part of the assessment order. That the assessment order was a composite order in respect of the turnover relating to six branches of the petitioner. After a part of this assessment order relating to Moradabad branch was quashed, it had become necessary for the assessing authority to pass a fresh assessment order and to issue a fresh notice of demand. The decision in the aforesaid writ petition has been reported as Karam Chand Thapar and Brothers v. State of U.P. 1975 UPTC 22. The operative portion of this decision reads thus: "In the result, the writ petition succeeds in part. The assessment order in so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tition. It was not necessary for the Sales Tax Officer to issue a fresh notice of demand when he had passed the order dated 1st September, 1976. For these reasons we are unable to accept the submission of the learned counsel for the petitioner and repel the same. In the instant case the order dated 1st September, 1975, cannot be treated as a fresh assessment order, and therefore it was not necessary to issue a fresh notice of demand. There was a reduction in the amount of tax by the order dated 1st September, 1976, and the case squarely fell within the ambit of clause (b) of sub-section (9) of section 8. The claim for interest for the assessment year 1969-70 has not been assailed on any other ground. We, therefore, hold that the demand of interest for the assessment year 1969-70 is legally well-founded, and there is no reason to interfere with it. In the result, this writ petition has no merit and is accordingly dismissed with costs. The stay order, if any, is discharged. Appendix [The judgment of the Division Bench of the Allahabad High Court consisting of SATISH CHANDRA and H. N. SETH, JJ., in Hukam Chand and Another v. The State of Uttar Pradesh and Others (Civil Misc. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 9th November, 1971, specifically granted 30 days' time from the date of its service for payment of the outstanding amount. This order was served on the assessee on 26th November, 1971. Thus the assessee had time till 26th December, 1971, to pay the tax demanded. Under section 8(1-A) penal interest starts running from the expiry of the time specified in the notice of demand. In the present case, the date of the expiry of the specified time was 26th December, 1971. The penal interest could hence run only from 26th December, 1971, onwards. Admittedly, the tax demand was paid up on or about 14th March, 1973, by the encashment of the bank guarantee. The penal interest could not hence run after that date. In the counter-affidavit it has been stated that in spite of the encashment of the bank guarantee a sum of Rs. 10 remained still due. Even if it is accepted, penal interest could be payable only on the balance sum of Rs. 10 after 14th March, 1973. The respondents were in error in realising penal interest on the entire tax demand for the period 14th March, 1973, to 27th July, 1973. The recovery certificate for Rs. 25,978.62 was clearly illegal. The petitioner was liable to pay p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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