Madon, J. - (1.) The Appellant, Ganesh Sugar Mills, is a partnership firm carrying on the business of manufacturing sugar in the District of Gorakhpur in the State of Uttar Pradesh. Sub-section (1) of S. 3 of the U. P. Sugarcane (Purchase Tax) Act, 1961 (U. P. Act IX of 1961) (hereinafter referred to in short as "the Act"), levies a tax on the purchase of sugarcane by the owner of a factory or a unit at the rates specified in the said subsection to be collected in the manner prescribed by rules made under the Act. Subsections (3) and (5) of S. 3, as originally enacted, provided and sub-sections (4) and (8) of section 3 provide as follows:"(3) Any tax payable under this Act, if not paid by the date prescribed for payment thereof, shall carry interest at the rate of six per cent per annum from such date till the date of payment. (4) Where any tax payable under this Act, or interest thereon, or both, as the case may be, remains unpaid for a period exceeding fifteen days beyond the date prescribed for payment thereof, the person liable to pay the same shall, in addition to the amount of arrears of tax and interest thereon, be also liable to pay, by way of penalty, a further sum, not exceeding ten per cent of the total sum payable, calculated at such rate or rates as may be prescribed. (5) Any person aggrieved by an order of assessment made under this Act, or by the imposition of interest under sub-section (3) or penalty under sub-section (4), may within thirty days of the intimation of that order, or imposition, as the case may be, prefer an appeal to the Cane Commissioner. (8) The officer or authority empowered to collect the tax may forward to the Collector of the district where the factory or the unit, as the case may be, is situate, a certificate under his signature specifying the amount of arrears of tax and interest, if any, due from any person, and on receipt of such certificate the Collector shall proceed to recover the amount specified from such person as if it were an arrear of land revenue."
(2.) By his notice dated December 14, 1967, the Cane Commissioner, Uttar Pradesh, intimated to the Appellant Firm that under sub-sections (3) and (5) of S. 3 of the Act a sum of rupees 3,53,648 was due as interest up to October 31, 1967, and called upon the Appellant Firm to deposit the said amount in the Treasury within 15 days. The concluding paragraph of the said letter stated, "The entire record on the basis whereof the interest has been calculated can be seen in the office of the Cane Inspector concerned." By his notice dated March 13, 1970, the Additional Collector, Gorakhpur, intimated to the Appellant Firm that the Cane Commissioner, Uttar Pradesh, had sent a certificate for recovery of a sum of Rs. 3,83,745/- "on account of interest of Purchase Tax ending 31-3-69" and that on his failure to pay the said sum into the Treasury by March 20, 1970, coercive measures would be adopted. A copy of the said notice along with a recovery certificate was sent to the Tahsildar, Pharender, for taking necessary action in consultation with the Sub-Divisional Officer, Pharender, to whom also a copy of the said notice was sent for taking necessary action. The Appellant Firm also received another notice dated March 13, 1970, from the Additional Collector, Gorakhpur, stating that a sum of Rs. 1,87,575 on account of penalty for the year 1969-70 was outstanding against it up to February 28, 1970, and called upon it to deposit the said amount immediately in the Treasury.
(3.) On March 20,1970, the Appellant Firm filed writ petition, being Civil Miscellaneous Writ Petition No. 1153 of 1970, before the Allahabad High Court contesting the validity of the said notice dated March 13, 1970, on the ground that no interest or penalty could be demanded under the Act unless an order was passed imposing such interest or penalty, and further on the ground that no details were supplied to the Appellant Firm with respect to the amount of interest claimed and that no opportunity had been given to the Appellant Firm to contest these demands. During the pendency of the writ petition in the High Court, the recovery certificate with respect to penalty was recalled by the Additional Collector and no question, therefore, relating to the said notice demanding penalty falls to be determined by us in this Appeal.;