Rajasthan High Court - Jodhpur
Asst.Commissioner,Spl.Circle,Ct.,Bhilwar vs M/S Madhusudan Industries Ltd. ... on 12 September, 2023
Bench: Madan Gopal Vyas
[2023:RJ-JD:29167]
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
S.B. Civil Revision Petition No. 551/2005
Assistant Commissioner, Special Circle,
Commercial Taxes, Bhilwara
----Petitioner
Versus
M/s Madhusudan Industries Ltd.
SPL Plot No. 149, RIICO Industrial Area,
Nimbahera, Chittorgarh
----Respondent
For Petitioner(s) : Mr. Sunil Bhandari
For Respondent(s) : --
HON'BLE MR. JUSTICE MADAN GOPAL VYAS
Judgment
DATE OF JUDGMENT 12.09.2023
Despite service, nobody appeared on behalf of the
respondent.
2. The instant revision petition has been preferred by the
petitioner under Section 86(2) of the Rajasthan Sales Tax Act,
1994 against the judgment dated 13.08.2002 passed by the
Rajasthan Tax Board, Ajmer (hereinafter referred to as the Tax
Board) in Appeal No. 51/2001/Chittorgarh whereby the Tax Board
while partly allowing the appeal quashed and set aside the orders
of Assessing Authority and the Deputy Commissioner (Appeals),
Udaipur.
3. Brief facts for the determination of instant revision petition
are that the Assistant Commissioner, Commercial Tax, Special
Circle-Bhilwara inspected the firm and examined the accounts of
[2023:RJ-JD:29167] (2 of 4) [CR-551/2005]
the respondent wherein it was found that in the assessment year
1996-97, the respondent purchased rapeseed oil on which 2% tax
was leviable but the respondent did not pay the aforesaid tax. The
Assessing Authority passed the assessment order dated
19.08.1996 and thereafter an order dated 25.09.1999 holding that
the respondent was liable to pay 2% tax upon the purchase of oil
alongwith interest and penalty. Aggrieved by the aforesaid order,
the respondent preferred an appeal before the Deputy
Commissioner (Appeals), Udaipur which was partly allowed vide
order dated 4.10.2000. Aggrieved by the order dated 04.10.2000,
the petitioner preferred a second appeal before the Rajasthan Tax
Board, Ajmer. The Tax Board partly allowed the appeal vide
judgment dated 13.08.2002 and quashed the orders passed by
the Assessing Authority and Deputy Commissioner (Appeals),
Udaipur. The petitioner has approached this Court to challenge the
judgment dated 13.08.2002 to the extent that once tax was found
to be leviable, the respondent was under an obligation to pay tax
and interest from the date of purchase and not from the date of
assessment of tax.
4. Learned counsel appearing for the petitioner submits that the
judgment passed by the learned Tax Board is erroneous and
contrary to law. It is submitted that the learned Tax Board has
failed to appreciate the facts of the case. It is an established
position in the present matter that the respondent had made
purchase of oil on which sales tax was attracted. It is submitted
that when tax is leviable, the levy of interest is automatic. It is
further submitted that as per settled principles of law, the liability
[2023:RJ-JD:29167] (3 of 4) [CR-551/2005]
to pay tax and interest accrues from the date of purchase and
ends on the day on which such amount is paid. In support of his
contentions, learned counsel placed reliance on Section 58 of the
Rajasthan Sales Tax Act, 1994 and the following judgments:
(I) Assistant Commissioner, Commercial Taxes, Circle Nagaur
v. Mahalaxmi Oil Industries, Rajasthan Oil Mills reported in
[2017] 47 TUD 83 (Raj).
(II) CTO v. M/s Rastogi Steel Furniture reported in [2003] 06
TUD 317 (Raj).
5. Heard learned counsel for the petitioner and perused the
material available on record.
6. Section 58 of the Rajasthan Sales Tax Act, 1994 reads as
under:
Interest on failure to pay tax or other sum payable:
(1) Where a dealer or a person commits default in making the
payment of any amount of tax leviable or payable or of any
amount of tax leviable or payable or of any amount of tax, fee,
interest or penalty assessed or determined or of any amount or
demand otherwise payable, within the specified time under the
provision of this Act or the rules made or notification issued
thereunder, such dealer or person shall be liable to pay interest
on such amount at the rate of two per cent per month, for the
period starting from the day immediately succeeding the date
specified for such payment and ending with the day on which
such payment is made.
(2) Subject to the provisions of sub-section (2) of section 70,
interest under sub-section (1) shall be calculated -
(a) at the time of assessment under any section or in
continuation of such assessment; and
(b) on payment including adjustment of a demand in full.
(3) The liability to pay interest under the provisions of this
section shall also arise for a period which is less than a month.
On perusal of Section 58 of the Rajasthan Sales Tax Act, it is clear
that in case a dealer or person commits default in making
payment of any amount of tax leviable, interest is attracted. The
calculation of such interest begins from the day immediately
[2023:RJ-JD:29167] (4 of 4) [CR-551/2005]
succeeding the date on which the payment is to be made. In the
present case, the assessee did not pay tax for a period of 33
months, therefore, on account of tax being unpaid, interest was
automatically leviable from the date of purchase of rapeseed oil.
7. This Court, in M/s Rastogi Steel Furniture (supra) has held
that the dealer/person shall be liable to pay interest on the
assessed amount of tax with effect from the date it was deemed
to have become payable but was not so paid.
8. Consequently, the present appeal succeeds. The judgment
dated 13.08.2002 is quashed and set aside to the extent of
determination of liability of assessee to pay tax and interest. The
order of Assessing Authority dated 19.08.1996 and the order of
Deputy Commissioner (Appeals), Udaipur with respect to
imposition of tax and interest upon the respondent are hereby
restored.
9. No order as to costs.
(MADAN GOPAL VYAS),J
C-1-CPGoyal/-
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