Orissa High Court
M/S. Bharat Motors Ltd vs The Commissioner Of Sales Tax on 27 March, 2025
Author: Arindam Sinha
Bench: Arindam Sinha
IN THE HIGH COURT OF ORISSA AT CUTTACK
W.P.(C) No.8236 of 2025
M/s. Bharat Motors Ltd., Khurda .... Petitioner
Represented by Adv.-
Mr. R.P. Kar, Senior Advocate with
Mr. S. A. Mohanty, Advocate
-Versus-
The Commissioner of Sales Tax, .... Opposite Parties
Odisha, Cuttack and another
Represented by Adv.-
Mr. Sunil Mishra, Standing Counsel
CORAM:
THE HON'BLE THE CHIEF JUSTICE
AND
THE HON'BLE MR. JUSTICE ARINDAM SINHA
ORDER
Order No. 27.03.2025
W.P.(C) no.8236 of 2025 and I.A. no.4726 of 2025
01. 1. The seminal point involved in the instant writ petition is
whether the authority is competent to levy interest under Section
7(5) of the Odisha Entry Tax Act, 1999 (OET Act) for delayed
payment of entry tax posts the Nine-Judge Bench decision of the
Supreme Court in case of Jindal Stainless Ltd. v. State of
Haryana reported in (2017) 12 SCC 1. The instant petition arises
from garnishee notices dated 20th February, 2025 and admittedly
the entry tax component has already been deposited with the
authorities except the interest portion.
2. The point as indicated hereinabove was a pivotal issue
before the Division Bench of this Court in M/s. Shree Bharat
Motors Ltd. and Another v. The Sales Tax Officer,
Bhubaneswar-1 Circle, Bhubaneswar and Others (W.P.(C)
No.13736 of 2017 and batch, decided on 15th March, 2023).
Though the said matter relates to the charging of an interest under
Section 7(5) of the said Act for a period between 2010 and 2017,
but an argument was advanced that after the delivery of the
judgment by the Nine-Judge Bench, it would be undue hardship on
the Department in not charging the interest thereafter. The Division
Bench, after taking into consideration the various provisions of the
Act, held that the orders passed in the aforementioned Constitution
Bench decision have created an embargo in claiming the interest
between the period from 2010 to 2017 i.e. the date of the
judgment, which comes within the ambit of a sufficient cause but
there is no fetter put on the Department in charging the interest
after the Constitution Bench decision of the Supreme Court and the
Division Bench judgment of this Court. It was held that it is within
the competence of the Department to charge the interest under the
aforesaid provision and further proceed to held that there is no
fetter in charging the compensatory interest post the Constitution
Bench decision of the Supreme Court and the judgment of Division
Bench of this Court. The matter has been taken to the Supreme
Court by filing a Special Leave Petition (SLP) and it is not in
dispute that the petitioner herein has also approached the apex
Court in which an interim order to the effect that no coercive steps
shall be taken, was passed.
3. Both the counsel appearing for the respective parties are at
variance on the scope of adjudication of the Division Bench in
M/s. Shree Bharat Motors Ltd. (supra). According to the
petitioner, the point which is raised in the instant writ petition is
one of the pivotal issues in the SLP in which the interim protection
has been extended; on the other hand, the counsel for the
Department submits that the only point involved before the
Supreme Court in the said SLP relates to a compensatory interest
charged between 2010-2017. We have been taken to various
documents including the orders passed in other proceedings. After
meticulous examination of the same and upon reading the
judgment rendered in M/s. Shree Bharat Motors Ltd. (supra), it
appears that the exercise of power under Section 7(5) of the said
Act even in relation to post 2017 was involved, but there appears
to be an ambiguity in this regard as the Division Bench was
considered a point of charging an interest under the aforesaid
provision, which comes within that mischief period i.e. 2010-2017.
4. In view of such ambiguity having perceived and for the
reason that the apex Court has issued a notice in the said SLP and
passed an interim protection, it would be apposite to have a
clarification with regard to the involvement of the point canvassed
in the instant writ petition. The petitioner is directed to bring the
clarification whether the point urged in the instant writ petition is
squarely falls within the purview of the SLP as aforesaid within
four weeks from the date of passing of this order.
5. In view of the findings as adumbrated hereinabove, any
coercive steps if taken in the meantime, may cause serious
prejudice to the petitioner and therefore we pass an interim order
of staying all the garnishee notices dated 20th February, 2025
issued by the opposite parties for a period of four weeks from date
or until further order, whichever is earlier.
6. List on 24th April, 2025.
( Harish Tandon )
Chief Justice
(Arindam Sinha)
Judge
M. Panda/A. Nanda
Designation: Junior Stenographer
Location: High Court of Orissa
Date: 27-Mar-2025 19:44:13
