Surcharge under taxable turnover provisions cannot apply to lump sum composition dealers without determined taxable turnover.

Additional tax in the nature of surcharge under Section 7A of the Haryana Value Added Tax Act, 2003 is linked to taxable turnover and cannot be levied where a dealer pays a lump sum under a composition scheme and taxable turnover is not determined. The Act distinguishes normal levy on taxable turnover from composition, where a fixed sum is accepted in lieu of tax payable under the Act. Because the surcharge provision and related interest depend on taxable turnover, the levy fails when the composition scheme substitutes a lump sum based on capacity, consideration, or similar criteria rather than taxable turnover.

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Issues: Whether additional tax in the nature of surcharge under Section 7A of the Haryana Value Added Tax Act, 2003 is leviable on dealers paying lump sum tax under the composition scheme, where taxable turnover is not determined.

Analysis: The scheme of the Act distinguishes between normal taxation under Sections 3, 6 and 7, where tax is levied on taxable turnover, and composition under Section 9, where a lump sum is accepted in lieu of tax payable under the Act. Section 7A creates a separate levy of additional tax in the nature of surcharge, but its text makes the levy and collection dependent on taxable turnover and excludes only retailers opting for lump sum composition. The rules show that in several composition categories, including contractors, brick kiln owners, lottery dealers and ply-board manufacturers, the lump sum is not computed on taxable turnover, but on capacity, draw, consideration, or similar measures. In such cases, one essential component of the levy is absent, because taxable turnover is not determined. The same consequence applies to interest linked to the additional tax demand.

Conclusion: Additional tax under Section 7A is not leviable on lump sum composition dealers where taxable turnover is not determined, and the consequential levy of interest cannot survive.

Final Conclusion: The appeal succeeded, the surcharge demand was set aside to that extent, the circular was quashed, and the connected writ petitions were disposed of accordingly.

Ratio Decidendi: A fiscal levy can be sustained only when all essential components of taxation are present; where the statute makes the surcharge dependent on taxable turnover, it cannot be imposed on a composition scheme that substitutes a lump sum unrelated to taxable turnover.

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