STATE OF ORISSA Vs. JAYASANKAR TRADERS

JUDGEMENT

(1.) AT the instance of the Revenue, the following question has been referred to this Court under section 24 (1) of the Orissa Sales Tax Act, 1947 (in short "the Act") by the Orissa Sales Tax Tribunal (in short "the Tribunal" ).

(2.) THE background facts as indicated in the statement of the case are as follows : Sri Jayasankar Traders (hereinafter referred to as "the assessee") filed its return for the assessment year 1980-81 under the Central Sales Tax Act, 1956 (in short "the Central Act") and the Central Sales Tax (Orissa) Rules, 1957 (in short "the Central Rules" ). The assessing officer completed the assessment. Subsequently, a proceeding under rule 10 of the Central Rules was initiated and interest of Rs. 600 was charged on the ground that the assessee had withheld a portion of the admitted tax. In appeal, the said levy was annulled on the ground that rule 10 did not authorise recourse to charge of interest. Subsequently under section 9 (2) of the Central Act read with section 12 (4-a) of the Act a proceeding was initiated for charge of such interest. The assessing officer charged interest overruling the objection of the assessee that since interest was not charged at the time of original assessment, it could not be charged subsequently, particularly when the attempt of the department to charge interest under rule 10 has been negatived by the appellate authority. The Sales Tax Officer was of the view that the provisions for charging or demanding of interest have been specifically inserted in the Central Act in section 9 (2), and, therefore, the provisions of the State law relating to charge or demand of interest were applicable to the same extent as were applicable under the State law. He, accordingly, charged interest of Rs. 699. In appeal, the Assistant Commissioner of Sales Tax, Appellate Unit, Jeypore, upheld the charge. The assessee carried the matter in second appeal before the Tribunal. The charge was nullified by the Tribunal with the finding that once the appellate authority has annulled the charge of interest under rule 10 of the Central Rules, it was not available to the assessing officer to reopen the matter under section 9 (2) of the Central Act.

(3.) RULE 10 of the Central Rules and section 9 (2) of the Central Act are contextually different. Rule 10 deals with cases of non-assessment or under-assessment. The language used in this rule is more or less similar to that used in section 12 (8) of the Act. Section 9 (2) of the Central Act deals with procedural aspects relating to levy and collection of tax or penalty and charge of interest. "charging or payment of interest" was inserted by Act 103 of 1976 in the said section, and by operation of a deeming provision it is operative from the date of commencement of the Act. Section 9 (2) of the Central Act has adopted, for the purpose of proceeding under the said Act the procedure, i. e. , the machinery provisions prescribed under the general sales tax law of the appropriate State in respect of the matters specified in that sub-section. Rule 22 of the Central Rules prescribes that the provisions of the Act and the Rules made thereunder shall apply mutatis mutandis in respect of all procedural and other matters incidental to the carrying out of the purpose of the Act for which no provision is made in the said Rules or in the Central Sales Tax (Registration and Turnover) Rules, 1957. In view of this specific prescription, interest in terms of section 12 (4-a) of the Act is chargeable by application of section 9 (2) of the Central Act. Therefore, the Tribunal was not justified in holding that there was no scope of resorting to the said provision.