TMI Blog1997 (7) TMI 566X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeal No. 2156-2167 of 1993, & 2168- 2171 of 1993, 7728, 7735, 7865, & 9267 of 1995, - - - Dated:- 16-7-1997 - BHARUCHA S.P. AND JAGANNADHA RAO M. JJ. R.F. Nariman, Senior Advocate [M.L. Lahoty, Ashok Saraf and Mrs. A.K. Verma (for M/s. J.B.D. Co.), Advocates, with him], for the appellants. S.A. Syed, for the respondents. -------------------------------------------------- The judgment of the Court was delivered by S.P. BHARUCHA, J.- These appeals impugn a judgment and order of the High Court at Guwahati. It may be immediately stated that, there having been some difference of opinion between the two learned Judges who first heard the writ petitions filed by the appellants, four questions were referred to a third learned Judge and it is the first of those four questions which will determine these appeals. 2.. Briefly stated for the purposes of this judgment, the facts are these: The appellants manufacture and sell petroleum coke, which are goods declared by section 14 of the Central Sales Tax Act, 1956. The appellants are registered as dealers under the Central Act and liable to pay Central sales tax on the petroleum coke that is the subject of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f such firm or partition of such family, recovery of tax from third parties, appeals, reviews, revisions, references, refunds, rebates, penalties, charging or payment of interest, compounding of offences and treatment of documents furnished by a dealer as confidential, shall apply accordingly." 5.. It was contended before the learned third Judge that, there being no mention of interest in the first part of section 9(2) of the Central Act, the appellants were not liable to pay interest as aforestated. Reliance was placed upon the judgment of this Court in Khemka Co. (Agencies) Pvt. Ltd. v. State of Maharashtra [1975] 35 STC 571; [1975] 3 SCR 753. The learned third Judge noted the view taken by his two brother Judges on the first question and found that there was unanimity on the result, though for different reasons. He, therefore, took the same view and held that interest was payable by the appellants on account of delay in payment of Central sales tax even though no specific provision had been made in the Central Act in this regard. 6.. Our attention was invited to the Constitution Bench judgment in J.K. Synthetics Ltd. v. Commercial Taxes Officer [1994] 94 STC 422 (SC); [199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry provision, may be its objective was to compensate the Revenue for delay in payment of tax. But regardless of the reason which impelled the Legislature to provide for charging interest, the court must give that meaning to it as is conveyed by the language used and the purpose to be achieved. Therefore, any provision made in a statute for charging or levying interest on delayed payment of tax must be construed as a substantive law and not adjectival law. So construed and applying the normal rule of interpretation of statutes, we find, as pointed out by us earlier and by Bhagwati, J., in the Associated Cement Company s case [1981] 48 STC 466 (SC) that if the Revenue s contention is accepted it leads to conflicts and creates certain anomalies which could never have been intended by the Legislature." 7.. This proposition may be derived from the above: interest can be levied and charged on delayed payment of tax only if the statute that levies and charges the tax makes a substantive provision in this behalf. 8.. Our attention was also invited to the Constitution Bench judgment in Khemka Co. [1975] 35 STC 571 (SC) where the provisions of section 9(2) of the Central Sales Tax Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le under the Central Act. The words of the last part of section 9(2), viz., 'shall apply accordingly' relate clearly to the words 'and for this purpose' with the result that the provisions of the State Act shall apply only for the purpose of assessment, reassessment, collection and enforcement. The doctrine of ejusdem generis shows that the genus in section 9(2) of the Central Act is 'for this purpose'. In other words, the genus is assessment, reassessment, collection and enforcement of payment. The genus is applicable in regard to the procedure for assessment, reassessment, collection and enforcement of payment. The genus is from whom to collect and against whom to enforce. It is apparent that the extent of liability for tax as well as penalty is not attracted by the doctrine of ejusdem generis in the application of the provisions of the State Act in regard to assessment, reassessment, collection and enforcement of payment of tax including any penalty payable under the Central Act. " 9.. Ray, C.J., concluded by holding that the provision in the State Sales Tax Act imposing penalty for non-payment of sales tax within the prescribed time period was not attracted to impose pena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment, reassessment, collection and the enforcement of payment of any tax required to be collected under this Act in such State or in relation to any process connected with such assessment, reassessment, collection or enforcement of payment as if the tax under this Act were a tax under such sales tax law." 12.. Section 9(2-A) makes applicable to the assessment, reassessment, collection and enforcement of Central sales tax the provisions relating to offences and penalties contained in the State Acts as if the Central sales tax was a State sales tax. But section 9(2-A) makes no reference to interest. 13.. There is no substantive provision in the Central Act requiring the payment of interest on Central sales tax. There is, therefore, no substantive provision in the Central Act which obliges the assessee to pay interest on delayed payments of Central sales tax. 14.. Now, the words "charging or payment of interest" in section 9(2) occur in what may be called the latter part thereof. Section 9(2) authorises the sales tax authorities of a State to assess, reassess, collect and enforce payment of the Central sales tax payable by a dealer as if it was payable under the State ..... X X X X Extracts X X X X X X X X Extracts X X X X
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