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TMI Blog2008 (8) TMI 864X X X X Extracts X X X X X X X X Extracts X X X X ..... s along with payment of tax. However, since interest is payable for the delayed payment of tax from August 10, 1998 till date of payment, we dispose of all the sales tax revisions by setting aside the Tribunal's order to the limited extent indicated above. The assessing authority is directed to make modification in demand without any delay. - 50, 51,66 of 2008 - - - Dated:- 25-8-2008 - RAMACHANDRAN NAIR C.N. AND MOHANAN V.K. , JJ. ORDER:- The order of the court was made by C.N. RAMACHANDRAN NAIR J. The petitioners in the connected sales tax revisions were dealers in coffee, engaged in purchase and sale of coffee beans during 1998-99. Before the introduction of the Finance Bill, 1998, coffee beans were taxable at the point ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assembly and notified on July 28, 1998. However, the proposal for amendment for changing the point of levy of tax on coffee beans was given up and the original provision that is tax on first purchase was retained. Consequently, the petitioners became liable for payment of tax on first purchase of coffee within the State for the whole year. Even though the Finance Act was notified on July 28, 1998, the petitioners neither filed revised monthly returns declaring the first purchase turnover of coffee for three months, April to July, as taxable turnover nor remitted the tax along with such returns or even in the annual return filed in form 8 for the year 1998-99. However, later at the request of the assessing officer, the petitioners fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here was in fact no delay in payment of tax and so much so interest cannot be demanded. Counsel further pointed out that after passing of the Finance Act, 1998, the assessing officer did not make any provisional or regular assessment or demand tax for the first four months of the financial year 1998-99 from the petitioners. In other words, the petitioners contended that there was no default in payment of tax and consequently default interest is not payable under section 23(3) of the Kerala General Sales Tax Act, 1963. The Government Pleader on the other hand contended that, by virtue of rule 18(3) of the KGST Rules, the petitioners were liable to pay interest along with revised returns which have been filed under rule 18(2A) of the Rules. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tuation where a dealer failed to file return or even if filed, failed to include the full turnover, or even misclassified turnover leading to short payment of tax. Sub-section (3A) provides for collection of interest in all situations leading to short payment of tax along with the return. Even though counsel for the petitioners contended that petitioners had in fact included the turnover in the monthly returns filed for April to July 1998 and there is no escapement of turnover for the purpose of assessment, we are unable to accept the same because escapement of turnover for the purpose of section 23(3A) can happen even when taxable turnover is returned as exempted turnover or where turnover is not returned under the appropriate classificati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emand of interest from the petitioners is arbitrary. We do not think we can introduce any principle of equity herein because we are considering only the case of the petitioners independently and not in relation to Hindustan Lever Ltd. In fact, all that is tated in annexures 2 and 3 is that Hindustan Lever has issued form No. 25 for the purchase from the petitioners and they were allowed to adjust taxes paid by them on the purchase of coffee against other liability. There is nothing to indicate as to when the coffee purchased by Hindustan Lever Limited from the petitioners acquired the quality of last purchase and when exactly tax was paid by Hindustan Lever Limited. In other words, there is nothing on record to indicate that taxes on very s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly 1998. So far as the first three months are concerned, if the petitioners had filed revised monthly returns after the passing of the Finance Act in terms of rule 18(2A) of the KGST Rules, they could have avoided interest completely. It is only on account of this omission, the petitioners became liable for payment of interest under sub-section (3A) read with sub-section (3) of section 23 of the Act. However, we feel the petitioners are not liable to pay interest on the first purchase turnover of coffee for April, May and June until August 10, 1998, when they could have filed revised returns along with payment of tax. However, since interest is payable for the delayed payment of tax from August 10, 1998 till date of payment, we dispose of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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