Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2022 (4) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (4) TMI 65 - HC - VAT and Sales TaxLevy of interest for the delayed payment of tax - deferral agreement entered between the petitioner and the 1st respondent on 28.06.1996 has not been cancelled till date - Section 24(3) of the Tamil Nadu General Sales Tax Act, 1959 - HELD THAT:- There is no doubt that there was a delay in repayment of the tax, which was deferred under the Deferral Scheme as per the Eligibility Certificate (EC) issued to the petitioner by SIPCOT on 12.04.1996. Clause 8 of the Eligibility Certificate clearly states that in case of violation of any of the conditions in the Eligibility Certificate and the connected Government Orders will result in cancellation of deferral entirely. Thus, the petitioner having violated the milestone prescribed in condition No.5.1 of the Eligibility Certificate (EC) issued by the SIPCOT is liable to pay interest from the date on which the actual tax would have been paid for the deferral. However, the clarification issued by the Principal Secretary/Commissioner of Commercial Taxes, which has been extracted, indicates that the violation in deferral scheme can take place at two stages ie.,during the first period when a dealer violates any of the conditions prescribed in the Eligibility Certificate and during the second time, when the repayment of the tax was to be made by the petitioner, which has been treated as interest free -loan. The Principal Secretary/Commissioner of Commercial Taxes, vide letter dated 28.02.2014 bearing Letter No.Drafting Cell-I/28518/2012, has clarified that if violation happens during the second tenure, interest will start from the date of violation or from the date of default in payment of dues. If this concession is to be extended, the petitioner will be liable to pay the interest from the actual date of each default. In other words, the petitioner will be liable to pay interest for each of the period as per Clause 5.1 of the Eligibility Certificate - the intention of the Government is evident that though the agreement and the eligibility criteria contemplate a complete recovery of the amount as if there is no deferral at all, the revenue would be satisfied if proportionate interest is paid from the date of each default. The writ petitions are disposed off by remanding the matter to the 2nd respondent to apply the conditions provided in Paragraph No.4 of the circular/clarification of the Principal Secretary/Commissioner of Commercial Taxes, vide letter dated 28.02.2014 bearing Letter No.Drafting Cell-I/28518/2012 to the facts of the case and requantify the interest to be paid by the petitioner and collect the same from the petitioner - petition disposed off.
|