APSARA ENTERPRISES (P) LTD. Vs. C.T.O.

JUDGEMENT

(1.) THE petitioner, M/s. Apsara Enterprises (P) Limited, is a hotel located in Visakhapatnam. This writ petition concerns with the legality of an order of penality passed by the Appellate Deputy Commissioner, Kakinada, on 26 -2 -1988 in appeal No. VSP. 242/87 -88 by which the petitioner was asked to pay a sum of Rs. 93,307/ - towards penalty under Section 9 of the Andhra Pradesh Tax on Luxuries in Hotels and Lodging Houses Act, 1987 (for short 'the Act'). The Act came into force with effect from 15 -6 -1987. Sub -section (1) of Section 3 of the Act reads thus:

(2.) "Luxury provided in a hotel" is defined by clause (g) of Section 2 of the Act as meaning the accomodation for residence provided in a hotel, including air -conditioning, television, radio, music, extra beds and the like but does not include the charges for food, drink and telephone calls. By sub -section (1) of Section 6 of the Act, every proprietor liable to pay tax under the Act is required to submit a monthly return in the prescribed form to the assessing authority within 15 days after the expiry of the month to which the return relates. Section 7 of the Act speaks of assessment and collection of tax. Section 8 deals with assessment of escaped or under assessed tax. Section 9 concerns with imposition of penalty in certain cases. Sub -section (1) of Section 9, which is relevant, is in the following terms.

(3.) SRI Srinivasa Reddy, the learned counsel for the petitioner, contends that the appellate authority has not considered the crucial question whether There was 'sufficient cause' which has disabled the petitioner from remitting the tax within the prescribed time and that authority merely concluded that as the failure was not willful it must automatically result in levying penalty equal to the amount of tax due, ignoring the mandate enacted in Section 9(1) of the Act conferring discretion on that authority to levy penalty from Rs. 1/ - to the amount equal to the tax due as is evident from the words 'a sum not exceeding the sum of tax due'.