Monthly interest under luxury tax law upheld where the statute says "each month or part thereof," confirming 2% per month.

Section 7A of the Gujarat Tax on Luxuries (Hotels and Lodging Houses) Act, 1977 requires simple interest at 2% per month, not per annum, because the phrase "each month or part thereof" makes monthly computation mandatory. The legislative purpose, confirmed by the Statement of Objects and Reasons, was to secure timely payment of unpaid tax or penalty through interest at 2% per mensem, and that meaning is not altered by the provision having first been introduced by ordinance. The demand raised on the monthly basis is therefore valid.

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Issues: Whether interest under section 7A of the Gujarat Tax on Luxuries (Hotels and Lodging Houses) Act, 1977 is payable at two per cent per month or at two per cent per annum.

Analysis: Section 7A provides for simple interest at two per cent of the tax due for each month or part thereof for the period during which the tax remains unpaid. A construction that treats the rate as annual would render the words "each month or part thereof" ineffective. The Statement of Objects and Reasons also shows that the provision was inserted to ensure timely payment by charging interest at two per cent per mensem on delayed tax or penalty, and the fact that the provision was initially introduced through an ordinance did not alter that legislative purpose.

Conclusion: Interest under section 7A is chargeable at two per cent per month, not per annum, and the demand raised on that basis is valid.

Ratio Decidendi: A statutory provision for interest that expressly refers to "each month or part thereof" must be construed as providing monthly interest, and the legislative purpose reflected in the Statement of Objects and Reasons may be used to confirm that meaning.

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