TMI Blog1996 (8) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... k, Amritsar, as under: 1.. Tax for the second quarter (1-7-1995 to 30-9-1995): (i) Rs. 10,10,000 on 28-10-1995 (ii) Rs. 1,57,510 on -do- 2.. Tax for the third quarter (1-10-1995 to 31-12-1995): (i) Rs. 16,57,932 on 27-1-1996 (ii) Rs. 13,036 on -do- Assistant Excise and Taxation Commissioner issued notices to the petitionercompany twice stating therein that the petitioner-company had failed to deposit the tax due for the quarters ending 30th September and 31st December, 1995. The petitioner-company explained that tax had been duly deposited and, in proof thereof, the State Bank of Patiala had certified the deposit of tax. It was explained that the challans had been duly attached with the quarterly returns filed by the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assistant Excise and Taxation Commissioner is said to be wholly arbitrary and a result of gross misuse of power. The plea of the respondents is that tax for the second quarter of the assessment year 1995-96 was required to be deposited by 20th day of October, 1995, and for the third quarter by the 20th day of January, 1996. A period of 30 days was available for deposit of tax in cash. When the assessee chooses to deposit tax through cheques, the period prescribed under rule 20 of the Punjab General Sales Tax Rules, 1949 (for short, "the Rules") is 20 days only. It is pointed out that the assessee had deposited tax for both the quarters in question very late and, therefore, interest and penalty were rightly levied. Tax had been dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount shall be accepted at the District Excise and Taxation office made through a bank draft or crossed cheque drawn on a local scheduled bank in favour of the Assessing Authority." From the perusal of the aforesaid two sub-sections, it is apparent that a dealer has to furnish returns by such date as may be prescribed. Tax is to be paid by the dealer at the time of furnishing the returns, into the Government treasury or the Reserve Bank of India or at the District Excise and Taxation Office. The full amount of tax due under the Act according to the return is required to be deposited by the dealer in the prescribed manner. A receipt is required to be furnished along with the return. "Prescribed period" has been laid down in rule 20 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t care to look into the reasons for the small delay and proceeded to levy interest and to impose heavy penalty simply for the reason that there was some delay in the deposit of tax. The normal period of 30 days from the date of expiry of the quarter had not expired. Simply because tax had been deposited by the petitioner-company through cheques, that rendered the petitioner liable under the Act. The officer levying interest and imposing penalt acted in most arbitrary manner and exercised his jurisdiction without any sufficient reason. Rule 20 of the Rules permits deposit of tax within 20 days from the expiry of each quarter. It was necessary to call the petitioner to explain the delay of 7-8 days in the deposit of tax for each quarter. In t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fide belief that the tax would be deposited in cash but, subsequently, it is realised that it will be expedient or convenient to issue a cheque. An extreme technical view has been taken by the officer levying interest and imposing penalty in this case and it has resulted in undue harassment. There was a substantial compliance of law inasmuch as tax had been deposited within the period of 30 days for each quarter. When there were two periods prescribed in law, one for the deposit of tax in cash and the other for payment through a cheque, there can be a situation, as stated earlier, where an assessee, while availing of the benefit of a larger period, may eventually find it difficult to do so and thereby commit a bona fide default. Each case h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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