ASSAM CARBON PRODUCTS LIMITED Vs. STATE OF ASSAM

JUDGEMENT

(1.) THE writ petition is directed and arises out of an order dated November 19, 1992, passed by the Deputy Commissioner, Assam, Guwahati on a revision application upholding the order of assessment dated October 31, 1986 passed by the Superintendent of Taxes, Unit-A, Panbazar, Guwahati, so far as it relates to levy of interest in exercise of power under section 35-A of the Assam Sales Tax Act, 1947 read with section 9 (2) of the Central Sales Tax Act, 1956.

(2.) THE petitioner is a registered dealer under the Central Sales Tax Act and liable to pay Central sales tax on carbon product. For the delay in payment of taxes due for the relevant period the Superintendent of Taxes by his order dated October 31, 1986 levied interest on the petitioner in exercise of its power under section 35-A of the Assam Sales Tax Act read with section 9 (2) of the Central Sales Tax Act.

(3.) DR . A. K. Saraf, learned counsel appearing on behalf of the petitioner, firstly submitted that section 9 (2) of the Central Sales Tax Act does not envisage levy of interest for late payment of taxes and therefore the interest could not be realised under the Central Sales Tax Act in aid of section 35-A of the Assam Sales Tax Act. The learned counsel thereafter submitted that section 35-A of the Assam Sales Tax Act is discriminatory and violative of article 14 of the Constitution of India inasmuch as interest is charged at 24 per cent for the delay in payment of taxes whereas a maximum rate of interest on refunds due to the assessee is 6 per cent. Dr. Saraf further submitted that section 35-A of the Assam Sales Tax Act which provides for levy of interest is beyond the competence of the State Legislature inasmuch as the power of levy and collection of interest is not covered by entry 54 or any other entry of List II of the Seventh Schedule to the Constitution of India and as such section 35-A is beyond the legislative competence of the State Legislature.