High Court split a penalty and interest levy in tax assessment proceedings when petitioner paid tax impute before assessment order. Court alsowholed up a penalty but upheld interest on delayed payment.
Impugned orders quashed regarding penalty; interest order upheld for period from return date to payment date.
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IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 16.12.2015 CORAM
The Hon'ble Mr.Justice R.Mahadevan
Writ Petition Nos.15280 to 15282 of 2004 and W.P.M.P.Nos.18149, 18153 and 18151 of 2004
M/s.Gazzaz Leather Garments Co., No.53, Vepery High Road, Periamet, Chennai - 600 003. ... Petitioner in all W.Ps.
Vs.
The Commercial Tax Officer, Vepery Assessment Circle, No.3, Ritherdon Avenue, Vepery, Chennai - 600 007. ... Respondents in all W.Ps. Prayer in W.P.No.15280 of 2004 :-
Writ petition has been filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorari to call for records of the respondent in RC.87/2003/1998-99 (TNGST) and to quash the impugned proceedings dated 29.08.2003 insofar it relates to the imposition of penalty under Section 12 (3) and interest under Section 24(3) of the Tamil Nadu General Sales Tax Act, 1959, in view of the law down by the Division Bench of this Court in 125 STC 107.
Prayer in W.P.No.15281 of 2004 :-
Writ petition has been filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorari to call for records of the respondent in RC.87/2003/1999-2000 (TNGST) and to quash the impugned proceedings dated 29.08.2003 insofar it relates to the imposition of penalty under Section 12 (3) and interest under Section 24(3) of the Tamil Nadu General Sales Tax Act, 1959, in view of the law down by the Division Bench of this Court in 125 STC 107.
Prayer in W.P.No.15282 of 2004 :-
Writ petition has been filed under Article 226 of the Constitution of India praying for the issuance of a Writ of Certiorari to call for records of the respondent in RC.87/2003/1999-2000 (CST) and to quash the impugned proceedings
dated 29.08.2003 insofar it relates to the imposition of penalty under Section 12 (3) and interest under Section 24(3) of the Tamil Nadu General Sales Tax Act, 1959, in view of the law down by the Division Bench of this Court in 125 STC 107.
COMMON O R D E R
These Writ Petitions are filed, seeking for issuance of Writ of Certiorari to quash the final assessment orders, dated 29.08.2003, passed by the respondent, insofar it relates to the imposition of penalty under Section 12 (3) and interest under Section 24(3) of the Tamil Nadu General Sales Tax Act, 1959.
3.1. The petitioner herein is an exporter of leather garments to the foreign countries. The Union of India, in order to encourage the export of the goods to the foreign countries, came forward with an incentive by refunding the amount of the duties paid by the exporters. The amount of the duties paid, would be entered into a pass book, called as "Duty Entitlement Pass Book" (for short, 'DEPB') in which, the credit of the duty paid would be entered. Since the sale of the petitioner's goods were only export oriented, and according to the petitioner, the said DEPB were not considered as "goods" under the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as ''the TNGST Act'') the petitioner was under the impression that they were not liable to pay any tax on the sales of DEPB Licence. That apart, they have not registered themselves under the provisions of TNGST Act and CST Act.
3.2. When things were so resting, a spot inspection was conducted by the Officials of the Enforcement Wing at the petitioner's business premises, and they submitted a report, based on which, the respondent issued notices, dated 30.04.2003, proposing to assess the petitioner on the sales of DEPB Licence for the year 1998-99 under TNGST Act and for the year 1999-2000 under CST Act. Subsequently, the respondent also passed the impugned orders confirming the proposals made in the notices, dated 30.04.2003, and levied penalty under Section 12(3) and interest under Section 24 (3) of the TNGST Act. Aggrieved by
the same, the petitioner is before this Court by way of the present Writ Petitions.
-s/dAssistant Registrar True Copy Sub-Assistant Registrar sd/rsb To The Commercial Tax Officer, Vepery Assessment Circle, No.3, Ritherdon Avenue, Vepery, Chennai - 600 007. +1 cc to Mr.V.Sundareswaran Advocate sr.68200 +1 cc to Special Government Pleader (Taxes) High Court, sr.67905 Writ Petition Nos.15280 to 15282 of 2004 and W.P.M.P.Nos.18149, 18153 and 18151 of 2004
aa07/03/2016
3 issues framed by the court
Whether levy of penalty under Section 12(3) is tenable when the assessee paid the entire tax amount before the completion of assessment.
Whether levy of interest under Section 24(3) is applicable when tax was paid belatedly after the delay caused by the return filing.
Whether impugned assessment orders should be set aside in part and modified to retain interest payable on delayed payment.
Colour shows how this judgement treated each authority
Lingam and sons Vs. State of Tamil NaduApplied¶23
Lingam and sons Vs. State of Tamil Nadu (2010) 29 VST 20
125 STC 107Referred¶8
3 provisions across 2 enactments
M/s. Gazzaz Leather Garments Co.
The Commercial Tax Officer, Vepery Assessment Circle
R. Mahadevan
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
