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2010 (12) TMI 1274 - HC - VAT and Sales TaxImposition of 'late fee' for filing of returns under West Bengal VAT - Constitutional validity of Sub-section (2) of Section 32 of the West Bengal Value Added Tax Act, 2003 - provisions for imposition of late fee for filing of returns - Respondent contended that by introducing 'late fee' in furnishing return under Section 32(2) of the VAT Act beyond the due date, a dealer is practically benefited and/or saved from any penal consequences provided in Section 45(2)(a) or Section 46(2)(a) of the Act - existence of quid pro quo in imposing late fee - Competency of the "State Legislature" to impose fee in any matter in the List-II of the schedule VII - Retrospective effect of present Section 32(2) of the VAT Act. HELD THAT:- The relevant provisions set out above altogether makes it abundantly clear that under Section 32(2) of the Vat Act, a dealer is under legal obligation to furnish return within the prescribed period. In case of failure to do so, he may or may not opt for filing the return together with the total Net Tax and interest upon payment of "late fee" under the amended provision of Section 32(2) of the Act. Before amendment of the Sub-section (2) by Act-I of 2008. such a dealer could furnish return upon payment penalty and prior to that no such scope was available. The impugned amendment has introduced "late fee" in place of "penalty" which is entirely optional to such a dealer who has failed to furnish return within prescribed period. The dealer is under no compulsion or obligation to furnish return upon payment of 'late fee'. A dealer is still free to choose not to file return after the prescribed period upon payment of 'late fee' and to suffer penal consequences either under Section 45(2) or under Section 46(1) or under Section 46(2) of the Act. There can not be any room of doubt that the amended Sub-section (2) of Section 32 of the Act affords a benefit rather special beneficial right to the dealer to submit return upon payment of 'late fee' even after the prescribed period - Payment of 'late fee' as introduced by the Act I of 2008 can not be a characterized as Tax as choice is left with the dealer concerned to be attractable by the levy. Needless to mention a fee is payment levied by the state in respect of services performed by it for the benefit of the individuals. Existence of quid pro quo in imposing late fee - HELD THAT:- In case of levying tax there is no quid pro quo between the Tax payer and the State. But element of quid pro quo is a must in case of imposing Fee. By virtue of impugned amendment, a dealer is entitled to get service indirectly from the authority upon payment of late fee. His irregular filing of return is regularised upon payment of late fee without being suffered from penal consequences which can not be categorised as nothing but special service. Thus, there exists quid pro quo in imposing late fee. On careful scrutiny of the scheme and system of assessment of VAT liability of the dealers, it is satisfied that late fee' as introducing by Act-I of 2008 is not at all 'tax' - the learned Tribunal has not at all erred in coming to the conclusion that there is no basis for raising the plea of double jeopardy by the Petitioners. Competency of the "State Legislature" to impose fee in any matter in the List-II of the schedule VII - HELD THAT:- The imposition of impugned late fee by the State Legislature is well within its competency under Entry No. -66 of List II of VII Schedule. Retrospective effect of present Section 32(2) of the VAT Act - HELD THAT:- The retrospective effect of present Section 32(2) of the VAT Act, by no way, is prejudicial to the dealers because if they pay the 'late fee' they cannot be treated as defaulters and no penalty would be imposed for want of filing return which is due between 01.4.07 to 31.3.2008. Thus, the prayer of the Petitioners has no merit and the petition is liable to be dismissed - The learned Tribunal has made no mistake in dismissing the petitions of the Petitioners. The appeal, thus, fails. Petition disposed off.
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