2009 (1) TMI 801 - HC - VAT and Sales Tax

Key Criteria for Settlement Eligibility & Interest Payment under Tax Act

The court addressed issues regarding eligibility for settlement under the Samadhan Scheme, payment of interest under the Tamil Nadu Sales Tax (Settlement ... Payment of interest - Held that:- The designated authority has scrupulously followed the statutory provision in passing the impugned order. Only after the rejection order it appears that the petitioner paid the interest on January 6, 2004. At the time of making the payment of interest on the aforesaid date, in the eye of law, there was no application pending before the designated authority as the application made by the petitioner has been rejected as early as December 15, 2003. All the contentions raised by the petitioner that the interest has to be determined by the designated authority and demand has to be made by the authority and such demand has not been made are all incorrect statements. For the foregoing reasons, we are of the view that the writ petitions deserve no merit consideration. The petitioner is not entitled to the relief sought for. The writ petitions are dismissed. No costs. Issues involved:1. Eligibility for settlement under the Samadhan Scheme.2. Requirement of payment of interest under the Tamil Nadu Sales Tax (Settlement of Disputes) Act, 2002.3. Rejection of application for settlement due to non-payment of interest.4. Compliance with statutory provisions by the designated authority.5. Consideration of a subsequent scheme for settlement by adjusting the amount paid under the previous scheme.Issue 1: The judgment discusses the eligibility criteria for availing the Samadhan Scheme under the Tamil Nadu Sales Tax (Settlement of Disputes) Act, 2002. It highlights that an eligible assessee must file an application within the prescribed time with proof of payment at the specified rates. The designated authority is required to verify the particulars and determine the amount payable. Non-compliance with the eligibility conditions can lead to rejection of the application.Issue 2: The judgment delves into the requirement of payment of interest under the Act, emphasizing that interest must be paid before the issuance of the settlement certificate. It outlines the rates of interest applicable and the procedure for the assessing officer to intimate the designated authority about the interest collection.Issue 3: The court addresses the rejection of the petitioner's application for settlement due to non-payment of interest. It scrutinizes the timeline of events, including demands made for interest payment, notices issued to the petitioner, and the subsequent rejection of the application by the designated authority. The court concludes that the rejection was valid based on the petitioner's failure to fulfill the statutory conditions.Issue 4: The judgment evaluates whether the designated authority complied with the statutory provisions in rejecting the application. It analyzes the communications, demands, and notices sent to the petitioner regarding the interest payment. The court determines that the authority followed the prescribed procedures leading to the rejection of the application.Issue 5: Lastly, the judgment considers the petitioner's request to adjust the amount paid under the 2002 Act with a subsequent scheme introduced in 2008. The court, after reviewing the circumstances, directs the authorities to consider the petitioner's application under the new scheme for settlement, taking into account the amount previously paid, if no legal impediment exists for such adjustment.In conclusion, the judgment provides a detailed analysis of the issues related to eligibility for settlement under the Samadhan Scheme, the necessity of interest payment, the rejection of the application, compliance with statutory provisions, and the consideration of a subsequent scheme for settlement by adjusting the amount paid under the previous scheme.