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2007 (10) TMI 564
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.... the payment on base level sale figure as per G.O. Ms. No. 119, Commercial Taxes and Religious Endowments Department dated April 13, 1994. Hence, the petitioner herein was liable to pay the tax to the tune of Rs. 27 lakhs. Faced with the threat of recovery, the assessee remitted a sum of Rs. 20 lakhs; however it approached the Tamil Nadu Taxation Special Tribunal. In O.P. No. 242 to 244 of 1999, by order dated June 14, 1999, the Tribunal pointed out that as per the Government Order, the assessee would be entitled to the benefit of deferral of tax only over and above the base level payment of tax. While setting aside the order of demand, the Tribunal directed the second respondent to work out the actual loss as per the eligibility certificate and the deed of agreement and if anything was due, the assessing officer was entitled to re-work and demand the outstanding amount after issue of fresh notice. Thereafter, once again recovery proceedings were taken against the petitioner demanding for interest on the amounts which were paid beyond the date. Aggrieved by the same, the assessee once again approached the Tamil Nadu Taxation Special Tribunal. However, by order dated September 13, 2....
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.... on October 6, 1994 for a total amount not exceeding Rs. 12.33 lakhs. The deferral period was to start from 1994-95 to April 1, 2003 to April 30, 2003. The repayment schedule was to start from 2003-04 to April 1, 2012 to April 30, 2012. In terms of this, eligibility agreement was entered into between the petitioner and the third respondent on April 17, 1995. The agreement with reference to this eligibility, referred to the necessity of maintaining the base level production arrived at on the basis of the production of the last three years preceding the date of commencement of the deferral. It was also specified that the company would go on paying the tax to the level of base volume of production/sales and that once it reached this level, any further liability would be eligible for deferral of sales tax. It may be noted that except for the agreement dated April 17, 1995, the earlier agreement or the eligibility certificate did not touch on the payment of base level production. It is stated that as per the proceedings dated October 3, 1997, the Commercial Tax Officer, Purasawalkam Assessment Circle, the second respondent herein, issued a notice stating that the petitioner was in ar....
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....only available for the goods manufactured using additional capacity by way of expansion. Considering the nature of manufacturing activity, the petitioner stated that it was not easily ascertainable from the books the exact quantum in metric tonnes of the goods produced after expansion. The petitioner pointed out that they had approached the T.I.I.C. for suitable amendment to incorporate the value of goods in respect of quantity in weight and that they were awaiting for orders. Considering the difficulties expressed, the petitioner prayed for withdrawal of the garnishee proceedings and allow them to continue the deferral as already availed. By proceedings dated May 8, 2000, demand of interest was made at two per cent on the belated payment under section 24(2) of the Tamil Nadu General Sales Tax Act, 1959. It is seen that the letter addressed to the Deputy Commissioner was also marked to the Assistant Commissioner, the third respondent herein, and the Commercial Tax Officer, second respondent herein. In the wake of the recovery proceedings taken, the assessee replied on May 22, 2000 that they had paid a sum of Rs. 13,00,000 as equated monthly instalments and Rs. 75,000, ....
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....pplicable to those industries set up after the publication of the said notification. He referred to the clarification of the Special Commissioner dated June 21, 1995 which showed that the department had accepted the decision in W.A. No. 509 of 1994. When the assessee had commenced production as per the eligibility given, it was entitled to the benefit of deferral. He pointed out that the assessee was entitled to the full amount of deferral and that the mere fact of his paying the amount after the issue of notice would not entitle the Revenue to impose interest. He stated that when the tax itself was not payable as per the scheme of deferral of sales tax and that the payment itself was pursuant to the insistence of the Revenue, the action taken could not be upheld. Learned counsel for the writ petitioner submitted that when G.O. Ms. No. 500 Industries (MIG-II) Department dated May 14, 1990 alone governs the first two expansion units and there was no stipulation either in the agreement or in the certificate as regards the base level payment and that the assessee was granted deferral in respect of the capacity governed by the expanded unit, the question of payment of interest on an....
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....13, 1994, either in the form of an intimation amending the agreement originally entered into in respect of the first units, or was there an intimation to the assessee to maintain the base level payment as per G.O. Ms. No. 119 Commercial Taxes and Religious Endowments Department dated April 13, 1994. Nor is there anything in the eligibility or in the agreement as to the requirement of payment up to the base level production/sales. It may be seen that even though the eligibility certificates given for the first unit and the amended certificate stated that the benefit of IFST would be as per G.O. Ms. No. 500 Industries (MIG-II) Department dated May 14, 1990 and other Government Orders that might be issued from time to time, the position remained unaltered without any intimation/reference through base level payment of tax. It is however relevant to note that the Government Orders pertaining to the granting of sales tax deferral scheme contemplated the eligibility with reference to the investment made under the expanded unit and that the benefit is not to exceed the investment under the fixed assets. A reading of the eligibility certificate shows that the deferral of sales tax is on ....
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....the power of the Government to grant waiver as regards the interest payable on the amount due. Section 16B of the Tamil Nadu General Sales Tax Act, 1959, refers to the power to reduce or waive penalty in certain cases by the Commissioner of Commercial Taxes. Section 17 deals with the power to notify exemption and reduction of tax. Sub-section (4) of section 17 specifies that the Government, by notification, could remit the whole or any part of the tax or penalty or fee payable in respect of any period by any dealer under this Act. Under section 17A(2), it is specifically stated that notwithstanding anything contained in the Act, the deferred payment of tax under sub-section (1) or sub-section (1A) shall not attract interest under sub-section (3) of section 24, provided the conditions laid down for payment of the tax deferred are satisfied. In the light of the genuine doubt raised in the mind of the assessee as regards the maintenance of base level payment and having regard to the fact that even after G.O. Ms. No. 119 dated April 13, 1994 there was no intimation for maintaining the base level payment in respect of the two expanded units, this court feels that considering the power a....