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TMI Blog1998 (1) TMI 504X X X X Extracts X X X X X X X X Extracts X X X X ..... thority (AA) made an assessment order (impugned in these proceedings) under section 10(3), RST Act on April 1, 1983. By this order the AA, inter alia, held a turnover of Rs. 3,09,89,382 being sales of the goods in question made after March 31, 1979 in the period in question to M/s. J.K. Industries, Kankroli in Rajasthan to be exigible to tax at 4 per cent and assessed the amount of tax to be Rs. 12,39,575.28. The AA took note of the fact that the Co. had collected deposits for possible contingencies at 8 per cent and had refunded the excess of 4 per cent collected. The Co. claimed that the sales in question were exempt from tax under a notification of the State Government of March 5, 1973. The AA held that in order to get the benefit of that notification it was necessary to show that additional excise duty was leviable and had actually been paid and as that was not the case here the sales were exigible to tax. The AA also decided to ask the Co. to show cause why interest under section 11B, RST Act, be not imposed as the Co. had not remitted the deposits collected by it to the State Government. 5.. Hence the instant writ petition. The prayers include a prayer for declaring tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9.. Notification No. F.4 (46) FD/Gr. IV/80-6 dated August 12, 1980 may also be taken note of. It reads: S.O. 56.-In exercise of the powers conferred by sub-section (2) of section 4 of the Rajasthan Sales Tax Act, 1954 (Rajasthan Act 29 of 1954), and in supersession of all previous notifications in so far as they relate to the exemption of goods mentioned in this notification, the State Government being of the opinion that it is expedient in the public interest so to do, hereby exempts from tax the sale or purchase of cotton fabrics, fabrics made from man-made fibre, sugar and tobacco as defined in the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (Central Act 58 of 1957): Provided that in case of tyre cord fabrics or warp sheets, this exemption shall apply only if the additional excise duty is leviable on them under the said Act and such goods have not specifically been exempted from the said duty and the dealers thereof furnish proof to the satisfaction of the assessing authority that such duty has been paid. (emphasis supplied) 10.. Notification No. F.4(18)/FD/Gr. IV/82-13 dated May 28, 1982 is also relevant on account of its retrospective effect an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the position that obtained after the notification of March 5, 1973 the Supreme Court at page 263 of the Report observed as follows: The unconditional exemption from sales tax granted on the sale of rayon fabrics, that is to say, without the condition that additional excise duty was paid by the manufacturer, was withdrawn by a notification dated March 5, 1973, made by the Rajasthan State Government under section 4(2) of the Rajasthan Sales Tax Act. The notification provided that in the case of unprocessed rayon and artificial silk fabrics the exemption from sales tax would apply only if the additional duty is leviable on them under the Additional Duties of Excise (Goods of Special Importance) Act, 1957, and such goods had not specifically been exempted from the said duty and the dealers thereof furnished proof to the satisfaction of the assessing authority that such duty had been paid. Therefore, as from March 5, 1973, the exemption from tax under the Rajasthan Sales Tax Act was available only if additional excise duty was leviable and the dealer had established that he had paid such duty.... (emphasis supplied) 13.. This effectively determines the controversy regarding taxabi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of one of the two assessment years in question the Co. had filed the statutory appeal available to it that even for the remaining year the Co. should file such statutory appeal and that the bar of limitation would neither be raised nor considered in such appeal. 17.. That leaves the question of levy of interest. It is the contention of the learned counsel for the Co. that the interest is liable to be charged only from the date of quantification of demand. In this context the writ petition refers to the decision of the Supreme Court in the case of Associated Cement Co. Ltd. v. Commercial Tax Officer [1981] 48 STC 466, on which allegedly the AA relied and that the entire issue had been referred by the Supreme Court to a larger Bench of 5 Judges which was still awaited at that time and that the decision of the larger Bench in respect of assessment orders passed in 1975, 1976 and 1977 will also govern the case in respect of the assessment year in the present writ. The decision of the larger Bench of the Supreme Court is available, and is reported as J.K. Synthetics Ltd. v. Commercial Taxes Officer [1994] 94 STC 422. 18.. With respect to the chargeability of interest under the RST A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the sales that took place on or after April 7, 1979 the liability to tax also arose on or after April 7, 1979 and the chargeability of interest would not, therefore, be governed by the ruling of the Supreme Court in J.K. Synthetics case [1994] 94 STC 422. Section 11B as has been introduced from April 7, 1979 in fact provides for the payment of interest from the date by which the tax became payable till it was actually paid. However, as already noted the impugned assessment order only raised the issue of the chargeability of interest and does not in fact levy any interest. The issue was left to be determined separately after considering the representation of the Co. on the question of interest. It needs to be borne in mind that interest is not chargeable because deposits towards possible contingencies were collected and not deposited with the Government. Such deposits are not collection of tax and are not liable for forfeiture. Interest is chargeable if the sales are exigible to tax and the payment of tax is delayed-the interpretation of such delay being dependent on whether section 11B, RST Act as it stood prior to or after April 7, 1979 was attracted. In the facts and circumstan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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