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TMI Blog1973 (4) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... Bench decision of the Allahabad High Court whereby that court answered by a majority of two to one the following question referred to it by a Division Bench in the negative against the assessee-appellant: "Whether, in order to recover interest under section 8(1-A) of the U.P. Sales Tax Act, it is necessary for the Sales Tax Officer to make an assessment order in respect of the interest and to issue a notice of demand in respect of such interest." The appellant, a partnership firm, is a large-scale manufacturer of biris. The appellant was assessed to tax under the U.P. Sales Tax Act, 1948 (U.P. Act No. 15 of 1948) (hereinafter referred to as "the Act"), for the assessment years 1957-58 and 1958-59 as per assessment orders dated June 10, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liability to pay interest amounting to Rs. 1,38,000 on the amount of sales tax under section 8(1-A) of the Act. A petition under article 226 of the Constitution was consequently filed by the appellant in the High Court challenging the recovery of the interest amounting to Rs. 1,38,000. The main ground which was taken by the appellant in this connection was that without making an assessment order and without issuing a notice of demand the Sales Tax Officer had no jurisdiction to initiate proceedings for the recovery of interest. Reliance in this connection was placed on behalf of the appellant upon an earlier Division Bench decision in the case of Beni Ram Mool Chand v. Sales Tax Officer [1969] 23 S.T.C. 423., wherein the Division Ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Pradesh Bikri-Kar (Dwitiya Sanshodhan) Adhiniyam, 1963, whichever is later, then, without prejudice to any other liability or penalty which the defaulter may, in consequence of such non-payment, incur under this Act, simple interest at the rate of eighteen per cent per annum shall run on the amount then remaining due from the date of expiry of the time specified in the said notice, or from the commencement of the said Adhiniyam, as the case may be, and shall be added to the amount of tax and be deemed for all purposes to be part of the tax: Provided that where as a result of appeal, revision or reference, or of any other order of a competent court or authority, the amount of tax is varied, the interest shall be recalculated accordingly: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant has argued that it was essential for the Sales Tax Officer to make an assessment order in respect of the interest before he could issue recovery certificate against the appellant. In any case, according to Mr. Sen, recovery certificate in respect of the interest could not be issued till such time a notice of demand in respect of the interest had been issued by the Sales Tax Officer to the appellant-firm. These contentions, in our opinion, are not well-founded. There is no provision in the Act which makes it obligatory on the part of the Sales Tax Officer to make an assessment in respect of the interest which the amount of sales tax would carry under section 8(1-A) of the Act. There is also no provision in the Act which requires the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is consequently not possible to specify a definite figure in respect of the interest in the recovery certificate. At the time the arrears of sales tax are paid, there can be no difficulty in finding the amount of interest which has become due. The amount of tax on which interest is to accrue, the rate of interest, the date from which interest is to commence and the date up to which interest is to be counted are all known. It is, therefore, a matter of mere arithmetical calculation to arrive at the figure of interest. We find nothing in any of the provisions of the Act as may warrant making of another assessment order by the Sales Tax Officer regarding the amount of interest or making it obligatory for him to issue a demand notice in respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e after the commencement of the Constitution, it shall come into operation on the day on which the assent thereto of the Governor or the President, as the case may require, is first published in the official Gazette. It may also be mentioned that in paragraph 33 of the writ petition filed in the High Court the appellant too had taken the stand that the U.P. Act 3 of 1964 had come into force on February 1, 1964. Argument has also been advanced by Mr. Sen that the interest on arrears of sales tax could not be realised for the period during which the recovery of sales tax was stayed. We find it difficult to accede to this contention because there is nothing in the language of section 8(1-A) of the Act which prevents the running of interest be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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