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2015 (4) TMI 571 - HC - VAT and Sales TaxLevy of tax on public sector undertaking - scope and ambit of Section 25(5) - whether a public sector undertaking which does not deposit tax at the requisite rate can escape levy of interest by alleging a bona fide error - Held that:- A perusal of Section 25(5) of the Act reveals that where an assessee defaults in payment of the requisite tax, payment of interest is a necessary consequence of such a default. Section 25(5) of the Act does not admit to any exception much less on a plea that the assessee is a public sector undertaking or that it committed a bona fide error. Even otherwise the assessee does not deny the default. We cannot but reject the plea based upon a bona fide error as there is no ambiguity in the notification. The failure to deposit tax was the result of gross negligence that cannot be condoned. - Where an assessee, whether a public sector undertaking or otherwise, defaults in payment of tax without a bona fide explanation or there is no dispute pending as to the levy of tax, a necessary consequence of such default shall in levy of interest under Section 25(5) of the Act. - Decided against assessee.
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