TaxTMI 
TaxTMI 
2004 (9) TMI 626
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....section 23(3) of the KGST Act for delayed payment of Central sales tax. Whereas according to the respondents by virtue of the provision of section 9(2) of the CST Act, all the provisions of the KGST Act in regard to assessment and recovery of penal interest, etc., will automatically apply. In this case, the petitioner has challenged exhibits P2, P4 and P5 assessment proceedings under the CST Act to the extent of the interest levied therein by invoking the provision of section 23(3) of the KGST Act. The petitioner has also sought for a declaration that section 9(2), 9(2A) and 9(2B) of the CST Act and the validation clause enacted by the Union Finance Act, 2000 as unconstitutional and invalid. There is a further prayer for a declaration th....
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....; AIR 1975 SC 1549 particularly paragraph 35 of the majority judgment. Counsel submitted that the Union Parliament has delegated the essential powers to the State Government which is not valid in law. Counsel submits that the Constitution Bench in the said decision had observed that conferment of such an uncontrolled power upon the State Legislatures could, if it was really intended, be said to travel beyond the province of permissible delegated legislation on the principles laid down long ago by the Supreme Court itself in In Re Delhi Laws Act, 1912 case [1951] SCR 747; AIR 1951 SC 332, etc. Counsel on the basis of the said decision submits that, an abdication of an essential legislative powers to the State Government in the matter of levy....
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....nt Pleader also submits that, the other provisions of the Constitution relied on by the petitioner have no application. I have considered the rival submissions. So far as the legislative competence and the validity of the provision of section 9(2), 9(2A) and 9(2B) of the CST Act are concerned the very question is concluded by the decision of the Supreme Court in Shiv Dutt Rai Fateh Chand [1983] 53 STC 289; [1983] 3 SCC 529, where the Supreme Court after due consideration of the relevant matters including the decision of the Constitution Bench of the Supreme Court in Khemka's case [1975] 35 STC 571 upheld the validity of the aforesaid provision and even the validation Act has been upheld. In the said case the following contentions wer....
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...., the basis of the judgment in Khemka's case [1975] 35 STC 571 (SC) was also removed and consequently the judgment delivered in that case could not stand in the way of realisation of penalties in accordance with validating provisions of section 9(2) of the Amending Act. It was held that subsection (2A) of section 9 of the Act and section 9 of the Amending Act are adequate enough to assess and realise penalty with effect from January 5, 1957 as contemplated therein. The second contention was rejected by holding that sub-section (2A) of section 9 of the Act does not suffer from the vice of excessive delegation merely because the provisions relating to penalty in the general sales tax laws of the states are adopted for purpose of the Act. ....
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.... charges the tax makes a substantive provision in this behalf. After referring to the Constitution Bench decision in Khemka's case [1975] 35 STC 571 (SC) it was noted that section 9(2A) as amended makes no reference to interest. It was held that there is no substantive provision in the Central Act regarding payment of interest on CST and hence in view of the decision in Khemka's case [1975] 35 STC 571 (SC) the demand of interest at 24 per cent per annum on delayed payment of CST under the provisions of the State Act must be held to be bad in law. This decision was rendered on July 16, 1997. Section 9(2) and 9(2A) were amended and a new section 9(2B) was added by the Finance Act, 2000 (Act 10 of 2000). Section 9(2A) amended with e....