TaxTMI 
TaxTMI 
2009 (10) TMI 516
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....------------------------------------------------- ORDER In this batch of civil appeals, the following issues arose for determination before the Allahabad High Court See Kajaria Ceramics Limited v. State of U.P. [2009] 20 VST 964.: (1) Whether sub-section (2B) of section 9 of the Central Sales Tax Act, 1956, inserted on May 12, 2000 by the Finance Act of 2000 is retrospective. and (2) Whether section 120 of the Finance Act, 2000 which was a validating Act was invalid inasmuch as it purports to validate a provision which had never existed in the statute book. For the sake of convenience, we may refer to a few facts in the lead matter in the case of Shivalik Cellulose Limited v. State of Uttar Pradesh (Civil Appeal....
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....there is no dispute that in each of these years, the taxes with penalty have been paid. However, they have been paid after considerable delay. The question which, therefore, arises for determination in this batch of civil appeals is whether sub-section (2B) inserted in section 9 operated retrospectively and whether it would cover the aforestated assessment years 1979-80, 1980-81 and 1981-82. At this stage, we may also mention one more fact. Vide section 120 of the Finance Act, 2000, which was the validating provision, the Legislature made it clear that the provisions of section 9 of 1956 Act shall have effect, and shall be deemed always to have effect as if that section provided for levy of interest for delayed payment for the period ....
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....r done as validly and effectively as if the provisions of sub-section (1) had been in force when such interest was imposed or proceedings or acts or things were taken or done and, accordingly,- (a) no suit or other proceedings shall be maintained or continued in, or before, any court, Tribunal or other authority for the refund of any amount received or realised by way of such interest; (b) no court, Tribunal or other authority shall enforce any decree or order directing the refund of any amount received or realised by way of such interest; (c) where any amount which had been received or realised by way of such interest is refunded before the date on which the Finance Act, 2000 receives the assent of the President and such refund wo....
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....s sub-section (2B) effective right from the very first date of commencement of the 1956 Act, i.e., January 5, 1957. One more aspect needs to be highlighted. In the present case, we are concerned with the levy of interest for delayed payment. Under sub- section (2B) to section 9, such interest for delayed payment is given the status of "tax due". The said interest is compensatory in nature in the sense that when the assessee pays tax after it becomes due, the presumption is that the Department has lost the revenue during the interregnum period (the date when the tax became due and the date on which the tax is paid). The assessee enjoys that amount during the said period. It is in this sense that the interest is compensatory in nature and ....