Dishonoured cheque for admitted tax does not stop statutory interest; delayed payment attracts liability regardless of reasonable cause.

A cheque tendered towards admitted tax operates only as a conditional payment and does not discharge the liability unless honoured. If the cheque is dishonoured, the tax is not treated as paid on the date of tender, so interest for delayed deposit remains payable under section 8(1) of the U.P. Sales Tax Act, 1948. The statutory interest liability arises from failure to deposit admitted tax within time and is not defeated by proof of reasonable cause or absence of mala fide. Principles relevant to penalty provisions do not govern interest liability under this section.

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Issues: Whether interest under section 8(1) of the U.P. Sales Tax Act, 1948 was payable on delayed deposit of admitted tax where payment was tendered by cheque within time but the cheque was later dishonoured, and whether reasonable cause or absence of mala fide could defeat the interest liability.

Analysis: A cheque tendered towards tax liability is only a conditional payment and does not operate as discharge unless it is honoured. If the cheque is dishonoured, the tax cannot be treated as having been paid on the date of tender. The liability to pay interest under section 8(1) arises from failure to deposit the admitted tax within the prescribed time and is not dependent upon proof of mala fide or absence of reasonable cause. Considerations relevant to penalty provisions do not govern interest liability under section 8(1).

Conclusion: Interest under section 8(1) was payable, and the assessee was liable for interest on the delayed payment of admitted tax.

Ratio Decidendi: For interest on delayed payment of admitted tax, a cheque is effective only if honoured, and the statutory liability arises on failure to pay within time without regard to reasonable cause or mala fide.

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