9911796707
TMI Blog2004 (1) TMI 660X X X X Extracts X X X X X X X X Extracts X X X X ..... ts borrowed by him from the petitioner-bank had it appears mortgaged one of his property in favour of the petitioner-Bank. 3.. The borrower of the funds from the petitioner-bank having defaulted in repayment of the amount, petitioner-bank had filed a suit for recovery of the amount and for enforcement of the security. The said suit was decreed and for the satisfaction of the decree the property that had been mortgaged in favour of the petitioner-Bank was sold through court auction. It is significant to note that by this time the said borrower was also a defaulter under the provisions of the Karnataka Sales Tax Act and the Central Sales Tax Act and amounts were outstanding in favour of the respondent-Commercial Tax Department and as su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he outstanding amount had attracted the provisions of section 13(2)(ii) of the Act under which at the relevant time the amount attracted penalty at the rate of 2.5 per cent per month. 8.. It also transpires that by the time the tax dues from the assessee from the year 1957-58 was paid, the last payment being as on December 10, 1997, the outstanding amount had by then attracted considerable penalty/interest under section 13(2)(ii) of the Act. The penalty amount it appears had swollen to an extent of Rs. 10,76,724. It is when the respondent sought to recover this amount also from the petitioner-bank and at this point of time the petitioner-bank has filed an application under section 13(2-A) of the Act before the Government seeking for w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s nature invoking the provisions of section 13(2-A) of the Act. It is the correctness and the legality of this communication that is called in question by filing the present writ petition. 11.. Sri Radhesh Prabhu, learned counsel for the petitionerbank, has urged several contentions. The first and foremost of the contention is that the respondent-State could not have summarily rejected the application of the petitioner holding that the petitioner has no locus or right to file an application seeking for waiver of penalty. The other contention is that the petitioner had not been given proper opportunity and that the order is virtually in disregard of the directions of this Court issued in writ petition vide order dated March 12, 2001, that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13(2-A) of the Act and as to whether the petitioner can said to be a person who can maintain an application of this nature for the relief of seeking waiver or reduction of levy of penalty under section 13(2)(ii). 15.. I have been taken through the provisions section 13(2)(ii) and also section 13(2-A) of the Act under which the application has been made. These provisions read thus: 13(2)(ii). the person or persons liable to pay the tax other than tax payable in advance for any year under sections 12 and 12-B or any other amount due under this Act shall pay a interest equal to two per cent of the amount of tax or any other amount due remaining unpaid for each month after the expiry of the time specified under sub-section (1). ...... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... even in the capacity of a person who had obtained a decree against the defaulter and in possession of the funds which were attributable to the sale of the properties in execution of that decree cannot hold on to the amounts as against the amount due to the State for realisation of any amount due under the Act. It is only because the petitioner has not paid the entire due under the Act though the sale proceeds of the property which belonged to the assessee in default were more than sufficient to meet it, the present situation has arisen. 19.. Be that as it may. The question is as to whether the so-called application of the petitioner under section 13(2-A) of the Act has met the proper consideration and the outcome as indicated in annexure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he scope and purport of person or class of persons envisaged in section 13(2-A), to a person like the petitioner-auction purchaser of the properties of an assessee in default. An understanding or interpretation of this nature can unduly expand the scope of provisions of section 13(2-A) and any other subsequent auction purchaser can also seek or make an application under section 13(2-A) of the Act praying for waiver or reduction of the penalty amount. The amount is essentially the liability of an assessee in default and it is not by the contribution of the auction purchaser and under such circumstances there won't be any need to look into such circumstances which could justify the delayed payment on the part of a person like the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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