TMI Blog1989 (12) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... t was felt to be quite harsh and burdensome, the Eastern India Motion Pictures Association moved the State Government. Ultimately the State Government reduced the show tax again to Rs. 10 with effect from September 17, 1985 and thus for the period January 20, 1984 to December 31, 1984, the petitioner was bound to pay at the rate of Rs. 25 per show. The total amount thus calculated works out to Rs. 23,800. The petitioner on the basis of calculation at the rate of Rs. 10 per show had paid Rs. 9,520 and, therefore, there was a default to the tune of Rs. 14,280. Admittedly the petitioner has paid up the said amount of Rs. 14,280, but the Commercial Tax Officer, Puri, has levied penalty under section 14 of the Act to the tune of Rs. 28,500 by or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urges that on a proper construction of section 14(2)(b) of the Act, the defaulted amount being Rs. 14,000, the officer concerned had no other discretion than to levy the penalty to the tune of Rs. 28,000 in accordance with the statute and, therefore, there has been no infirmity in the same. The rival contentions require a careful examination of the provisions of the statute. 4.. For better appreciation of the point in issue, section 14 of the Act is quoted herein below in extenso: "14. Penalties.-(1) The proprietor of any entertainment who- (a) admits any person for payment to any place of entertainment in contravention of the provisions of section 6; or (b) fails, without sufficient cause, to pay the tax due from him within the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is liable to pay a penalty amounting to fifty rupees per each person admitted to the place of entertainment where the default comes within the ambit of clause (a) of sub-section (1). Under section 14(2)(b), however, if the default comes within the ambit of clauses (b) to (d) of sub-section (1) then a penalty amounting to Rs. 250 or double the amount of tax evaded, whichever is greater, has to be levied. The proviso to sub-section (2) stipulates that before levy of penalty, the proprietor concerned will have a reasonable opportunity of adducing evidence in answer to the allegations made against him. There is no grievance in this case with regard to the affording of an opportunity to the petitioner. The entire argument of Mr. Lal centres rou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has to pay at the rate of Rs. 25 per show and not having paid the same must be held to have failed to pay the tax due without sufficient cause and, therefore, the case comes squarely under section 14(1)(b) of the Act. Obviously, therefore, the petitioner incurs the liability to pay the penalty under sub-section (2) of section 14 of the Act. The first submission of Mr. Lal for the petitioner, is, therefore, without any force and is accordingly rejected. 5.. So far as the second submission of Mr. Lal is concerned, we, however, find sufficient force in the same. The second contention really centres round an interpretation of section 14(2)(b) of the Act. Under sub-section (1) of section 14, four different types of defaults are contemplated u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner, is of much force and has to be accepted. Clause (b) of subsection (1) of section 14 speaks of a case of failure to pay the tax due within the time prescribed without sufficient cause, whereas clause (c) speaks of a case of fraudulent evasion of payment of tax due under the Act. The expression "fraudulent evasion" has a definite connotation and meaning. It is a positive act on the part of an owner to practise fraud and thereby to evade payment of a tax due. Where an owner pays the tax under the preexisting rate and has made a grievance before the State Government for reduction of the rate and under that belief has failed to pay the tax at enhanced rate, it cannot be a case of "fraudulent evasion", within the ambit of clause (c) of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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