9911796707
TMI Blog1980 (1) TMI 109X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. The original assessments in these cases for these two years were made on 29th March, 1974 and 13th March, 1975 without disallowing interest amounts of Rs. 5,119 and Rs. 5,862 debited to the accounts of the respective years for interest on delayed sales tax payment. Thereafter, the ITO passed orders under s. 154 on 26th June, 1976 disallowing the assessee's claim. 3. The assessee objected b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry was a clear infringement of law and any sanction visited for such unauthorised retention and utilisation of the Government funds could not be termed just as a civil liability. He held that the amounts paid by the assessee, namely Rs. 5,119 and Rs. 5,862, were in the nature of penalties for infringement of law and could not thus be allowed as a proper deduction. 4. The assessee, therefore, ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y for deduction. As against this, it is brought to our notice that the assessee's case for the asst. yr. 1972-73 in the IT Appeal No. 372 (Ahd)/77-78 was decided by the Tribunal by their order dt. 29th Nov., 1978 wherein the ld. Members of the Tribunal held that the imposition of the penalty by the State on a dealer for his failure, without reasonable cause, to pay sales-tax within the prescribed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the ST Act for delayed payment of sales-tax, its imposition gave rise to a substantive liability which could be viewed either as an additional tax or as a fine for the infraction of law. It is thus stated that the law on the subject was clear as laid down by the Final Court of Land and there were no two opinions on the subject. 5. We have carefully considered the submissions on either side. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and therefore, the Supreme Court's decision in the case of T.S. Balaram vs. Volkart Bros. (82 ITR 50) would apply. In the circumstances, in our opinion the ITO could not have passed an order under s. 154 of the IT Act. It has wrongly been invoked and the orders, therefore, require to be vacated. The order of the AAC is reversed. 6. In the result, the appeals are allowed. - - TaxTMI - TMIT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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