M/S. Audinarayana Trading v. The Deputy Commercial Tax

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED : 30.01.2018

CORAM

THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM W.P.Nos.5972 & 5973 0f 2012 and M.P.Nos.1 & 1 of 2012 M/s.Audinarayana Trading Company, rep. by its Partner, Mr.K.Muthusamy, No.7-A, Lakshmanan Street, T.Nagar, Chennai-600 017.

... Petitioner in both WP's Vs.

1.The Deputy Commercial Tax Officer, Now re-designated as Commercial Tax Officer, Kothawalchavadi Assessment Circle, 2nd Floor, Kuralagam Annexe, Chennai-600 108.

2.The Appellate Deputy Commissioner (CT) II, 6th Floor, Kuralagam Annexe, Chennai-600 108.

3.The Joint Commissioner (CT), Chennai (North) Division, 1, Greams Road, Chennai-600 006. ... Respondents in both WP's Petitions filed under Article 226 of the Constitution of India praying for issuance of Writ of Certiorari, calling for the records on the files of the 3rd respondent in Rc.No.7747/2010/C3 dated 12.01.2012 and quash the same in so far as the assessment years 1987-88 & 1988-89 are concerned. For Petitioner :

Mr.R.Senniappan For Respondents :

Mrs.G.Dhanamadhri, Government Advocate ******

C O M M O N O R D E R Heard Mr.R.Senniappan, learned counsel for the petitioner and Mrs.G.Dhanamadhri, learned Government Advocate for the respondents.

2.The petitioner has filed these writ petitions challenging the orders passed by the respondent, who is the Joint Commissioner, who has to decide the applications for settlement under the provisions of the Tamil Nadu Sales Tax (Settlement of Arrears) Act, 2006. The relevant assessment years, which are covered in these writ petitions are 1987-88 and 1988-89. The cases have had a chequered history, as the earlier assessments on the petitioner for the relevant assessment years were held to be not sustainable and accordingly set aside. However, the respondents preferred appeal and ultimately, the matter was decided in favour of the petitioner by the Hon'ble Division Bench and the matter was remanded to the assessing officer for taking a fresh decision in the petitioner's case for both the assessment years.

3.Pursuant to such direction, assessment was completed on 07.09.2006 for both the assessment years. The said order of assessment was communicated to the petitioner on 03.11.2006 and the petitioner filed applications under sub-section (1) of Section 5 of the Settlement of Arrears Act on 29.12.2006, after effecting payment of 100% of the tax, surcharge and additional sales tax and 10% of penalty for the relevant assessment years. These payments were made by the petitioner much prior to the filing of the application i.e., on 19.12.2006 itself. These facts are not in dispute. The application for settlement has been rejected on the ground that the petitioner has not paid 25% of the interest amount. The question would be, as to whether interest is leviable in the petitioner's case. 4.As noticed, the assessment orders were passed on 07.09.

2006, served on the petitioner on 03.11.2006 and the petitioner was granted thirty days time to pay the tax, as per the notice in Form No.N3. Well within this thirty days period, the application for settlement had been filed by the petitioner. Therefore, the question of levy of interest does not arise in the petitioner's case.

This interpretation will be in consonance with Section 24(3) of the Tamil Nadu General Sales Tax Act, 1956 (in short "the TNGST Act"). Therefore, the impugned order of rejection of the application for settlement on the ground that the petitioner has not remitted 25% of the

interest amount is incorrect, as no interest was leviable in terms of Section 24(3) of the TNGST Act.

5.For the above reasons, these writ petitions are allowed, the impugned orders are set aside and the matters are remanded to the third respondent, who shall take on file the applications filed by the petitioner for settlement and process the same after affording personal hearing and pass final orders on merits and in accordance with law as expeditiously as possible, preferably within a period of eight weeks from the date of receipt of a copy of this order. No costs. Consequently, connected miscellaneous petitions are closed. Sd/- Assistant Registrar(CS II) //True Copy// Sub Assistant Registrar abr To 1.The Deputy Commercial Tax Officer, Now re-designated as Commercial Tax Officer, Kothawalchavadi Assessment Circle, 2nd Floor, Kuralagam Annexe, Chennai-600 108.

2.The Appellate Deputy Commissioner (CT) II, 6th Floor, Kuralagam Annexe, Chennai-600 108.

3.The Joint Commissioner (CT), Chennai (North) Division, 1, Greams Road, Chennai-600 006.

+1 cc to the Special Govt Pleader(T) sr 7027 +1 cc to Mr.R.Senniappan Advocate sr 7257 W.P.Nos.5972 & 5973 0f 2012 ssd(co) aa21/02/2018