Compensatory interest on unpaid passenger tax was upheld where dues were not remitted to the State authority.

Interest was payable on unpaid passenger tax under the Himachal Pradesh Passenger and Goods Taxation Act, 1955 because the tax liability was admitted but the petitioner had not remitted the dues to the Himachal Pradesh authorities despite operating buses in the State. Section 12-A expressly fastened interest where tax or surcharge remained unpaid beyond the prescribed time, and the Court treated the levy as compensatory for deprivation of the State's legitimate dues. Any remedy for mistaken payment in Punjab lay against the Punjab authorities, not by resisting interest under the Himachal Pradesh statute.

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Issues: Whether the petitioner was liable to pay interest on the unpaid passenger tax under the Himachal Pradesh Passenger and Goods Taxation Act, 1955, despite the plea that tax had been deposited in Punjab by inadvertence.

Analysis: The tax liability was not in dispute and the petitioner had not deposited the tax with the Himachal Pradesh authorities despite operating buses within the State. The Court held that deprivation of the State's legitimate tax dues entitled it to compensatory interest. Section 12-A of the Himachal Pradesh Passenger and Goods Taxation Act, 1955 expressly made interest payable where tax or surcharge remained unpaid beyond the prescribed time, and the statutory levy applied to the petitioner. The petitioner's proper remedy, if any, lay in seeking refund from the Punjab authorities, not in resisting the lawful levy of interest under the Himachal Pradesh enactment.

Conclusion: The petitioner was liable to pay interest under Section 12-A of the Himachal Pradesh Passenger and Goods Taxation Act, 1955, and the challenge to the orders of the authorities below failed.

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