Statutory interest on unpaid tax and mandatory Form C control concessional sales tax relief

Interest under Section 8(1) of the U.P. Trade Tax Act, 1948 is a statutory consequence of unpaid tax and cannot be denied on the basis of bona fide belief or absence of mala fides. The liability arises from default, not from the taxpayer's intention, so equitable considerations do not displace the interest charge. Form C remains a mandatory requirement for claiming concessional treatment under the Central Sales Tax Act, 1956, and relief cannot be granted where the prescribed declaration is not furnished. The revision was allowed and the revenue's position was upheld on both issues.

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Issues: (i) Whether interest under Section 8(1) of the U.P. Trade Tax Act, 1948 could be denied on the ground that the transaction was bona fide and the assessee lacked mala fides; and (ii) whether relief could be granted in the absence of the statutory Form C for claiming concessional treatment under the Central Sales Tax Act, 1956.

Issue (i): Whether interest under Section 8(1) of the U.P. Trade Tax Act, 1948 could be denied on the ground that the transaction was bona fide and the assessee lacked mala fides.

Analysis: Liability to pay interest under Section 8(1) attaches once tax remains unpaid. The question is one of statutory default, not of bona fides or mala fides. Non-payment of the tax attracts interest from the relevant date, and equitable considerations such as legitimate expectation or bona fide belief do not displace that statutory consequence.

Conclusion: The deletion of interest was unsustainable and was set aside in favour of the revenue.

Issue (ii): Whether relief could be granted in the absence of the statutory Form C for claiming concessional treatment under the Central Sales Tax Act, 1956.

Analysis: Furnishing Form C is a mandatory condition for claiming the concessional rate of tax. Where the prescribed declaration is not furnished, the benefit cannot be extended. The Tribunal could not grant relief on a claim unsupported by the required statutory form.

Conclusion: The relief granted despite non-furnishing of Form C was unsustainable and was set aside in favour of the revenue.

Final Conclusion: The revision succeeded, the Tribunal's order was set aside on both points, and the question of law was answered in favour of the revenue.

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