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2020 (2) TMI 1112 - HC - VAT and Sales TaxWaiver of interest on the Interest Free Sales Tax Deferral Amount - petitioner became a sick industrial unit within the meaning of the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985 by the time when it was required to discharge the tax liability under the agreement - Section 17-A (2) of the Tamil Nadu General Sales Tax Act, 1959 - HELD THAT:- Interest Free Sale TCA Deferral Scheme is a special scheme prescribed under Section 17-A of the Tamil Nadu General Sales Tax Act, 1959 - Under the said provision, the Government may, by a notification defer the payment of the whole or any part of the tax payable in respect of any period of any new industrial unit or sick unit or sick textile mill. Interest Free Deferral of Sales Tax may be given prospectively or retrospectively. It is however to subject to such conditions as may prescribed which are incorporated in the Deferral Agreement. As per sub-section 2 to Section 17-A of the Tamil Nadu General Sales Tax Act, 1959, no interest is attracted under Section 24(3) of the Act during the deferral period, provided the condition laid down for payment of tax deferred are satisfied. A plain reading of Section 17A(2) of Tamil Nadu General Sales Tax Act, 1959 would indicate that petitioner is not entitled to waiver of interest even for the period during the deferral period as the petitioner breached the condition of the deferral agreement by not paying the tax in time as agreed - In this case, admittedly, the petitioner has not satisfied the condition for payment for deferred payment of tax and therefore interest is payable by the petitioner after the specified date. There is no basis on which the interest liability can be waived. The interest liability which could be waived by the respondent would have been be only in terms of 17-A (2) of the Tamil Nadu General Sales Tax Act, 1959 read with the Agreement. Thus at best the tax liability can be deferred. There is no power vested with the respondent to waive interest payable under Section 24(3) of the Tamil Nadu General Sales Tax Act, 1959 - Only when the assessing officer comes to a conclusion that the tax determined and payable by a dealer was less or the return was incomplete or where no returns were filed, a notice under section 13(2) of the Tamil Nadu Gen Sales Tax Act, 1959 is required to be issued to a registered dealer. Thus liability to pay is tax mandatory as long as same is reflected in the returns. For payment of tax, no assessment order is required and only in case of short payment of tax assessment is required after due notice - but for the deferral in payment of the tax under Section 17A of the Act, the petitioner would have been liable to pay tax irrespective of the assessment of tax liability as per Section 13 of the Act. Liability to pay tax is not dependent on the assessment order. Only in case of short payment such notice and assessment is required. Further, an assessment order merely completes the assessment and nothing more. If there is a deficit in payment of tax, a dealer can be asked to pay tax . If not assessment order will accept the tax paid and shown the sales tax return. The fact that the petitioner was within the purview of Board for Industrial and Financial Reconstruction and was declared as sick unit by the on 31.5.2006 and was de-registered on 05.12.2013 is of no avail - Petition disposed off.
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