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of <h1>Narcotic Department's Revisions Dismissed on Opium Tax; Interest Waiver Denied</h1> <h3>Dy. Narcotics Commissioner and other Versus Trade Tax Tribunal Bench Iii Lucknow</h3> Dy. Narcotics Commissioner and other Versus Trade Tax Tribunal Bench Iii Lucknow - TMI Issues involved:1. Dispute regarding the tax levied on opium cultivation by farmers for the Narcotic Department.2. Interest imposed under Section 8(1) of the U.P. Trade Tax Act, 1948.3. Tax liability on opium grown by farmers on behalf of the Narcotic Department.Analysis:I. The first issue revolves around the tax levied on opium cultivation by farmers for the Narcotic Department. The Narcotic Department argued that they are the exclusive owners of the opium crop grown by cultivators under contract, and thus, no sale of opium occurs. However, the Additional Chief Standing Counsel contended that the Supreme Court has held that the sale of opium to the Narcotic Department is a taxable item. Citing various legal precedents, it was established that the opium grown by cultivators is indeed subject to trade tax. Consequently, the revisions filed by the Narcotic Department against the tax levied were dismissed.II. The second issue pertains to the interest imposed under Section 8(1) of the U.P. Trade Tax Act, 1948. The provision mandates the payment of interest on unpaid tax amounts, with the charging of interest being deemed mandatory. Legal authorities were cited to emphasize that courts do not have the power to waive or restrict the charging of interest. Referring to past judgments, it was reiterated that the charging of interest is obligatory. Thus, the revisions seeking waiver of interest were dismissed, upholding the Tribunal's orders.III. The final issue addresses the tax liability on opium grown by farmers for the Narcotic Department. The Tribunal had initially ruled that tax was not leviable on opium cultivated by farmers on behalf of the Narcotic Department. However, the Supreme Court's decision in a related case established that opium is indeed a taxable item under the U.P. Trade Tax Act. Consequently, the Tribunal's orders were set aside, and the department's appeals were allowed. In conclusion, the revisions filed by the assessee were dismissed, while those filed by the department were upheld.
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