PATHROSE RICE AND OIL MILLS Vs. ASSISTANT COMMISSIONER

JUDGEMENT

(1.) THESE two cases were REFERRED TO a Full Bench as the issue involved in these cases, namely, the exigibility to penal interest under section 23 (3) of the Kerala General Sales Tax Act, 1963, has already been REFERRED TO a Full Bench in M. F. A. No. 4 of 1983 and other connected cases. Accordingly these two cases were heard along with the other cases. But in these two cases certain other questions also arise for consideration and accordingly they are being dealt with separately.

(2.) IN both these original petitions there is a prayer to declare section 23 (3) of the Kerala General Sales Tax Act as unconstitutional and of no effect and void. IN O. P. No. 9277 of 1983, the petitioner is a registered dealer in cashewnuts and an assessee on the file of the 2nd respondent. For the assessment year 1980-81, the petitioner had opted for the procedure prescribed under rule 21 of the Kerala General Sales Tax Rules, 1963 and was accordingly filing monthly returns of his turnover. For the months of May and June, 1980, the assessee claimed exemption from sales tax on the purchase turnover of cashewnuts under section 5 (3) of the Central Sales Tax Act, 1956, on the ground that the purchase was one in the course of export as it was the last purchase preceding the export of the goods outside the territory of INdia in compliance with an anterior order in relation to the export. The claim for exemption was rejected by the Sales Tax Officer and he passed an order of provisional assessment for the aforesaid two months, exhibit P1 order dated December 31, 1980. Against exhibit P1 order the petitioner filed an appeal and by exhibit P2 order dated November 17, 1981, the Deputy Commissioner (Appeals) held that the period for which the provisional assessment was made had already run out and the assessment is ripe for finalisation. Accordingly he directed the Sales Tax Officer to finalise the assessment as early as possible. It was further directed that the contentions put forward by the assessee could also be duly considered at, that stage.

(3.) O. P. No. 2361 of 1984 relates to levy of penal interest for the year 1978-79. Exhibit P1 dated July 14, 1983, is the final order of assessment by which the total tax due from the petitioner was fixed at Rs. 4,97,490. 18. The assessee had already paid an amount of Rs. 5,42,660 and thus he had paid an excess amount of Rs. 45,169. 82. Exhibit P1 further states that the excess will be adjusted towards the tax due for the year 1979-80. Exhibit P1 order further imposes an amount of Rs. 58,332. 54 as penal interest for that year. Petitioner is challenging exhibit P1 to the extent it imposes penal interest for the aforesaid amount, on the ground that section 23 (3) of the Act is unconstitutional and that no notice demanding the amount in form 14 was served on them. It is also contended that by exhibit P1 the final assessment having been made, holding that the petitioner has paid an excess amount of nearly Rs. 45,000, no penal interest can be levied towards non-payment of the amount due under the provisional assessment.