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2015 (3) TMI 260 - HC - VAT and Sales TaxLevy of interest - Held that:- It will be apparent from a reading of the said provision that the repeal of the Agricultural Income Tax Act, 1950 did not affect the previous operation of the said Act or anything done or any action taken, including any notice, order issued in exercise of any power conferred by or under the said Act and the same was deemed to have been done or taken in exercise of the powers conferred by under the 1991 Act. As already noticed, in the instant case, the proceedings that were initiated in terms of the 1950 Act were continued under the 1991 Act and Ext.P1 assessment order was passed only on 27.3.1993, after the coming into force of the new Act. Thereafter, pursuant to a modification of the completed assessment, a modified assessment order was passed on 8.10.1998. It was still thereafter, pursuant to the appellate proceedings before the Appellate Tribunal, that Ext.P2 revised assessment order dated 24.5.2006 was passed which levied interest on the tax amount that was found due and payable by the petitioner for the assessment year 1988-89. It needs to be noted that at the time of passing Ext.P2 revised assessment order, the provisions providing for the levy of interest, for a delay in payment of tax, had already come into force through the 1991 Act. Further, by way of the transitional provisions contained in the 1991 Act, all proceedings initiated under the earlier enactment had to be deemed as proceedings under the later enactment for the purposes of assessment and recovery of tax. In that view of the matter, therefore, the levy of interest for the period from November, 1998 to May, 2006, when Ext.P2 order was passed, cannot be said to be illegal. Reference to sub section (5) of Section 99 is only in respect of arrears pursuant to assessments that were concluded prior to the coming into force of the 1991 Act. The said provision is an enabling provision that enables the State Government to recover taxes, that became due and payable under the earlier enactment, subsequent to the repealing of the said enactment and the passing of the new enactment. In the case of proceedings that were pending at the time of coming into force of the 1991 enactment, it is the provision of sub section (1) of Section 99 that would apply, to deem those proceedings as proceedings under the 1991 Act for the purposes of assessment and effecting recovery of tax thereafter. In that view of the matter also, I am of the view that the levy of interest on the amounts found due and payable by the petitioner in the instant case cannot be found fault with. While finalising the assessment, the respondents had issued a demand notice demanding the balance tax that was found payable by the petitioner consequent to the assessment. Thereafter, when modified orders were passed, including the levy of interest, the order specifically indicated that the demand notice already issued to the petitioner would stand modified to take into account the modifications effected in the modified order. This admittedly included the interest component as well. As the petitioner does not deny having received the original demand notice, it will not be open to him to contend that there was no demand notice in respect of the interest subsequently levied since it was made known to him, through the modified order, that the demand notice earlier issued would also stand modified accordingly. Resultantly, I do not find any reason to interfere with Exts.P6 and P8 orders passed by the respondents - Decided against Appellant.
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