Karnataka High Court
M/S Varalaxmi Silk House vs The Deputy Commissioner Of Commercial ... on 1 July, 2010
Author: Anand Byrareddy
Bench: Anand Byrareddy
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE ff DAY 01: JULY I-l()1(')_v'~._j:'-«.,:fi._
BEFORE
THE HON""BLE MR. JUSTICE ANAE\ED ii
WRIT PETITION No. 13242 1(>Fi2oi09 {T535}/sTu«. "
BETWEEN:
M/s Vamiaxmi Silk H0use.__
No.7, Mission "Road, O J _
B£1E1gEli()1'€--27. '
By its Partner 1 I
Mr. KH. Venka-taifahigaiah; 2
Aged a1b0ut67 ygié-1'::S:i PETITIONER
{By
E. Thc --D_eput§r C(')1n15nisS-i()1ie1'of
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. The C--ui1n1n_i_ssic'>11e1' of
ai" _ C(Z'2I11l13€1'Ci.£li Taxes in Karnataka,
"'\F'.T.K. Building,
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Gzindiiiiitigai'.
B£1n.g£iiO1'€w5(7U 009. ... I{ESP()NI)'ENTS
(By Shri. KM. Shivztyogiswainiy, High Court G()V'e1'i1.tti--€.f}{«Pifili
for respondent ) * - '=-
This Writ Petition is fiied unde1"».A1't:i'eEei; 22.6 and 22:7'-..__ofath.e deli Constitution of India, pmying to _ L1_UL1Sh71hi€.Villipllgiifid »()rde;,i(i21tied_V i4.i0.2008, _iuStifyi'ng the my demand' ot"v_pe.na..i.ity_§underV> An1iexu1'e.--E and also to quash [h6iiii."f:_C('3V€I'y notice in Fgiriii No. 48 in RC.No. ()43()02424/,._1986 AC.Y_"..dttted ?,9.()4H.20v09, under Annexure--M demanding the afi'1'ez:-1173" -.of_i"i~--3(2) penéiity for Rs. i3,44,469/- and ete., v * 1 .0 This petitio11,._h_a.vin§g resserved on 10.06.2010 and coming on=..toi:fpiitiizoiiiieeinent :ofoi'dei's this day, the Court delivered the t'()i.i-oijving-:--. it _ E R _~5',,Hveiitr(1 the i€~£.¥_.E'v1v]t'3-Li' Counsel for the petitioner and the ieained 0' iGvf)i/fi:ri'1i!.1et1t' Aowocatte.
0' _ 2. _'fhe._fi;iets leziding up to this writ petition are as follows:
'Tviie petitione.1' is said to have been dealing i_n siiks during 0' ~,.Yi1t-i.\{:t1L'l1T 1986 2-ind was :1 registered dealer under the Kai'nataka it ...S'tiies Tax Act, 1.937 {_E_1erein_at'tei' E'€ft'31'1't3(i to as ' the KST Act' for S brevity). By an assessment order dated 31.3.1998. ttirn-over tax of Rs.6._l3,576/-- was levied by the first respondent in the assessment year 1986 and :1 Demand Notice was issued by the first i'esp()ndeiit,:"vyhich p\?&I&1S_.S'._3ii"~.'i(,'di on the petitioner on l6.5.l998. This w;1s_ ehallenigeid byenpéippezigiiiiflll-;2.der_2 Section 2.0 before the appellate 2iti»t.hfority. i'Fhe'*s::.éiid'Lippeal was allowed by an order dz1ted--.29--.9.l--'998, p'e._ifs.iiant to which, there was no fresh demand inade onthepetit-i()ner'fi"iHo'n3vfeyer, the competent authority h2i_(l.-ip--21sse;d_ _:;_1 i'~ey«isiena1l__t;a*der tinder Section 22A of the KST AgTt.3i..«{l§pit:.[ii.ili5;;5,_l9.994i'€'S'££.)IVli}g§ the assessment order and enha111cii"ig"the' t_ui'ii4oVerf'ii'*t;_i§i" as determined by the assessing authoi'_ity. l4i':>\i\Ie\rei".,_ tla.ere...~7w21s no fresh Dernamd Notice issued 9V'«_,pti1"s1iE111t---stt)«the stiid*oi'tle:". It is only as on 15.5.1999, that the saissesstitlg»--...;iutihority sought to invoke Section 1.3 of the KST Act le.v'y.'mg_>pe.néil.ty and interest on the petitioner, treating the 9 ;ae,*fi_ti()i1'e--r as :1 defai:lte_i'.
The petitioner chaillenged the szime by way of an appeal 9 mlill(i("3l' Section 24 of the Act. which came to be dismissed by an 'E order dated 3l.l.2(')()l. The pet'iti.one1' had thereafter preferred a review petition, which in turn, was dismissed on l"8._8;««2l}£}l. However, a Division Bench of this court p€1'IT]i[I€C-{file * to make an application for payment of itaxinp ililstaltneflisi vbetoiie the second respondent. On. such a.ppli.ca'tioithavingibeen '~'l'ile_d',~ second respondent passed an oride,r"tlz1tedi"~l6;'9.--20O24, granting instalment facility and in_c'l';-:dii_'-¥_g ~p_e.nah:y from the date of service of the assessrnent»~-order'and the idelmand notice. The petitioner tl1erett.fte.tffiled an.=aVppl.i.catiionseeking modification of g» the tardey-..igiaritingi'1inA_s.ta}.n.ie.1itsQ that no penalty could be levied tinderpi S'ectiofnA.r4il3(:Z}___of the KST Act, in the absence of service of a"revi_sed:_or3.a tifesli Demand. Notice pursuant to the ,,is.L)I'Cltf17iCLll1Cit3i'"S.6CtidiEl"?:2'13\ of the KST Act and that the petitioner 1 e--.cot1_eldi»he"tre::1tt..d as a defaulter in the absence of such a Notice. ljlo'-.ve~ver, the respondents having proceeded to initiate .ppirec:t)ve1fy~* proceedings, the petitioner was constrained to prefer a ivtiit 'petition before this court in WP 55055/2008, while seeking a midirection to the respondents to consider his application for '?> modiflcatioii which was pendiiig. Dtiringj. the pendency of the writ petition, the petitioner was directed to pay the a1nou~n.t"'i)_i'~tax and the writ. petition itself was disposed of on * directing the iiespondents to consider tllliéiiitfiztttfir'ilfrf:Sitflncl toT.tal'xe E1pp1'()pi'iklt€ decision.
Therealtei', the second i'espi(3i1dei1t, did.ni(";t--ip2isi's any order on the legal contention the want of 21 fresh Deintmd.iNotice,iii petitioner was a defaultei'. l.4.l0.20()8, that the second order is restored in revisi"o_n Ip1'oceedi'i"0§;si.iii"id_ei' Section 22A, the assessment order and the l)em=.i1id Notice (}§7l;glE1tllly issued would stand FE-St0!'6Cl. ii"VTlisi,iiipei.'itioi1ei' 'l:ile'd "" "fill zipplication on .ll.l().2()()8, seeking;
0...niio_dif"ie:2,itioiiiioifthe ()1'ClE31'dat.6d 14. 10.2008 while insistillg that the legiil po__s'itioii* was otherwise and therefore, the order be modified. ,iThe__ second respondent however stated that it was for the 7petitione1' to itpproach the appellate atitho1fi_ty in respect of any siieh contention. iiispite ofprol()11ged correspondeiiee thei'eafte.r, 3 amount under demand is not paid within the time specified. This stands to logic and would be in accordance with the impo.r_t"~oi'*~t11e law.
In the present case, there is anadinitted;ci_r.ctirr:stanc.ej. that there was no re-vised Demand TNotice'V_se'r\_zed oiigthe. _oe't-i_'iioner_ foiiowing the revisionai order under..:SectionV22A, for th-;eMKST Act 9 dated 15 .5. 1999. Hence,' the oetitione1* ought to be treated as a. service of the assessment not tenable. The responde-nts to oeiiaity from the date of S€l'ViC€i:iV'£_)'fi order dated 16.5.1998, is therefore without _jr1r~.jsd~iVcti'e~n and runs contrary to Section 34 read .,¢\,\}tf-l'(i'i:'3.-i%RL:i_i'i;'-S 118 t1nid"2'G"'()it' the KST Act and the KST Rules. It is contended_« ti1at._sii.r1ce there no appeal provided in respect of an order u1__§der'viiSection 13(2) of the KST Act, the petitioner being left with ndalternative remedy, has preferred this writ petition. for a hfindiiiig on the pointed question as to whether, the petitioner couid 'be treated as a defai1'1ter even without a fresh Demand Notice § béing served on the petitioner pursuzmt to the revisi(>na1 01.1331' as z1f01'es.aid and whether. the iespondents were not 0bEiged_.it)_:i:;sur: 21 fresh Demand Notice as sought to be contanded.
In this regard, the petitioner hz1S.:4p1.21;:edj1'ré'}i:in;:E:- (5'i?;"a%A_1a;gé number of authorities in sL1pp()1't"hjs cast', 11am"e'Iy';A~.{
(a) M/S Philips' Imrhci --.._L";';?-"z1z'r.f§.(l :.:m.c!._V_V4r1}m1'l1.er~ vA;s*." As.s'i.s'mnr C()n-2::r2is'.s'i()r1er* of Cm-nm_e'rc:'c4!¥"Tcz.x_¢}v, A{R .2005 S C 2894 (5)) M/s M". G.,:*'11¢'r§:2{jé1()I3iz:';e_v Cr);§1}§1j€_rjc*via'k§'fez): (Jffic,-6 r, Bellary, _ "
(cf) Gg>J'-.«=%i~r1rifi'~.(5u}i;&t;£j.i._r§.. ' ._T'aa1i.9i.(cI§¢_rV'.§' Savcmur, I)/'1a.rwacl I)istrir;'r czijci c'zr':_()t'F:vt%_.r. _()2.STC'399{DB)( Kerr), ((1) Pcri'é!._ 'K/o1kc'm I_'}'=--z'.pitfé: 4I_im.irec1 us, C0nm1i.s'.s':'m:er of C0}?I.I'I'l4i?'J"(.'f(£[V Tc.jzxc>~.s', 62 STC 41 I , "((2) " a'.S'tige'L,t.'li;-':5; C(}i'?.';S'fT'1f('If()I'J. and Tmcling Conlpczny vs.
--»CIg)1*r111=:4:j)'r;:i§1Z Tax ()_f}'}'c.'er, I Circflcz Bcm.gal:_)re, 1973(2)
(f) Sign' .:Cr~J/:l7(?lC1b/1611: Dexgji and Company vs. As:s'i5IcmI ~CrJ;«f.*1z111T.<;.s'i();'tc%r of C (}l?1}'1"l(?J"(,'f(I1 Taxe.s', ()2 STC 4] 9( DB ){ Kar) £'i3 N('1rm1.i 5!Lr')rcs ;>,_s'. Srare of Kerala, 122 STC 621. (Ker), _(}"z) Inc(>r11e«Ia.x' ()]fic:'er, Knlar C ircle am! am>z'l'a.er vs. Sega Bm.'*ha.z'l1 -Sr%!2f'_\-=, AIR 1964 SC 1473, G 9 (1') Tim Fir-'1-'2-1 Ai'.s'uran-: Rc.1II1.(%.s'hwar' Lari vs. Smn». 0f UI1ar Frczu/e.s'f'z um} 0rI1er.s", ( /974,)35 STC 54()('DB),
(j) R.M.M. Works vs. 1_):'.s'Iri(,'I Mcrgi.s'r:'(1I€, 35 STC"~'2:.(:3;?(z";xA/ii'? 4_
(k) B()l€n.ar/1 Sreen-zani vs. . A(1c:.7irii}i'i(;l «_ C()i'n:?ITi_S'f;Janers ('if C ()mn2.erci(z/ Tczws and (m01'h.€r, '-512 ;"'STC Cal )1 :; (1) S'r(m2 of U'n'ar ['r('z(!€5l1 vsf ,Sf:"4}?':1(:__7/?.(l}'(A'l."sfiig/fl iz.;1ci'v.:()'i'#'2f.?.I"3?'; Alkfi' [964 SC 358,
(m) P(!I7(.'/'Illa; Petlm. SI()r'ta----azi:7--.'i cz,.--§_1()1'§/V25} '".a._s';»_S'1'1::.fe of Ufmr Prades/1 and anor/zer, 96 STC 239 (A1-J;§)J ' "
(1/2) [Ba/Tm R(.m;1~~ '1"'."af'r'zz':-1. :Pc11j.§/'z ri(1 ijS'c'zlc.s' Tax Tri/_mnal, Pmy'a/.7j.C.'mg2.cfEg(--;_rIvv and ;-:;zr1()r._!':ef:',. 64.STC 468 (P & H ), (0) C012:r¢?.i*sA.§'i'{<,r1-{cfF1xggf 3&1"/:€wA:' Tc:x,.,VMEI/?(lI'Cl,$/lfI'(1, vs. Mac/1iner_y SaJ_.'es Sei"v£:i;'_r!, _ 7;? STC" ~13] (Bryn), (,0) .10}: "of.Kera.la and (Jr/fem', 6.2 STC 227 (Ker), - I ' V' {(1) v .%._Mcs»/2(.:[;:3_;' }'i"(i§s:t:r£-----Jnga('/i.s'/1 Pr'czsad vs. C70n1:ni.v.s'inner of * - % 1V.s*a[e.a:#;'?.:;V;»;;%_ 27 STC.' 33 72 (All), ( 1n('l.s'. Pr'iw.1fe Lin-'zi1.'ec1 12.5'. Sales Tm: Officer, 1 2 4 .1 0 {SC}, H J ./;.}§7.---.§'_3rr'zI/ieticw In,in1ir(,e(J vs. C(mm'zm*(:ic1l Tax Ofl'Icer_, 94 STC " _ (SC), V. ('I}"F I3rc.1jala! Bani}-c vs. Signs of Tripura and others, 78 STC 283 (G-cm), 6 (L1) K.Na('/7inmI/'II.-t vs. 50.165' Tax ()]j'I'r"er' I1 C.'ir¢..'l£?, 7*f'I'1~'c3Ejffi'«'.Fl£In (mdc'z1mrl7er, 95 STC 539, (V) Rajagiri Rubber and Produce C()rr1pczrzy=_<'"l'Limi}'e';l * Ac1diri0m1[Sczles tax Officer,-53 STC 37()(I_<.«:::=,'1,. * ' (w) Jai_\4-'a.rzri!(z1 Kiiesr vs. Ad(1il'ir)r1cn'.._ Cw12z1¥mr(:('t1l. T-ax"
and olhers, 1966(2) ll/I_\.*.s'.LJp.6_I4, (X) Vcu-*czla,x*mi Enterprises v.5'. S'mfc>» of Kc2m(ifrzl<;*z, 59 STC 98, STC 369 (Km) (y) V. V.Nc': gc.zraIh.inar-n. /l)fi.'j1zzIi'e-1:'if; .C0mmer('iaI Tax Off:'c'er, Sar-'1kl<m', (1 STC._4(34{Mn£f~r'ti.v),
4. On _fI1.e" 'cfi'E1;{3r_ ri-ajiizli' tl'ie..4,le;;ri1ed Government Advocate seeks to eonteiid th'a..f'~i.nl x?esQ"pee'E' ofthe assessment period 1.1.1986 to 3l.1_'7 l986«,.. th:--:va::_ses.sin'ient was concluded in respect of the V' ";Z)€Eltli()l'1€if-01129.6.li98'i%';""Whl.l€- concluding the assessment, thciugh I i.he.';isSeS$ee w"2i~::.e_ liable. to pay tum--over tax in View of an order of staytlated' l98l granted by this court, rendering Section 6-13 . _of the K_S7F Act inoperative pending disposal of the above peiition, tila.ei"reisponderi1--» authority had not levied tur1:1~oVe1.' tax under mSectio11 o~B. 115 the mezmwliile, the petitioner had preferred an 8 appeal against the assessment order before the Joint Commissioner of Commercial Taxes (Appeals). W'l1().U"llli'~.I_ll'l?l'l, remanded the matter to the assessing authority for * by his order dated 3l.l.l998. ACC()1fC1iiIlgi'}'i order under Section 12(3) of the 3l.3.1998. The exemption claiin1eids»by th'e._i_petitiorierHon the' taxable turn--over was arrived at was 'Rs.6, l6,375.4f4. Notice dated 4.5.1998 the petitioner on l.6.5.l998.; against the said order, the 'orde1~ dated 29.9.1998. The Additional Ci(3«i3imissi-on.ei'ii of7C(>inmei'cial Taxes, in turn, initiated ,.,sit.;.() '-iitiiéytrsti,pi<ocee.dii'iigs-----«'under Section 22A of the KST Act and ,;.fe'\iisedi tghepcsiiitliefloi' the appellate authority as being illegal and p1*e_it-:.(;lici_a~l~fzojthe interest of the revenue and by his order dated l.99'9,'iresto1'ed the original assessment order dated 3.1.3.1998.
.9 challenged by the petitioner in an appeal before this 99 "'eotirt., as stated by the petitioner himself. The appeal was ,% dismissed not maintainable by an order dated 3l.3.?,()(_)l. It is stated that in the above baekgi'oL1iicl, the petitioner was fu..il*y.y:aw'a--ije of the arrears of tax payable in Vi€W of the order l1:{i'v'i.ng._attaine'd: ' finality by the dismissal of the peititiiionerls'isap_peal]_bet'oife Division Bench of this court. Consequerit_ly;.1'he petivtiAone..r aware of his liability to pay assessment order. Hence,' theiiabisence of a revised demand notice, iti:i£§t'~iii)€C()II1€- liable to pay arrears is petitioner having been servedwiithiiiéi arrears cannot urge this liability. Further, pursuant to the direction by this court ir=.._the.,.~~pet.iti0iier's earlier writ petition, the '-petitioiii*e1?_--has,adniitte liability of Rs.6,_l 3,576/« and had paid 'the .satinie,"»,,lE{oweve1', the petitioner continues to be liable to pay interest on amount for belated payment. Therefore, there is i Viie.siabst21'nee in the present. writ petition.
"The several authorities cited are in support of the "p1}it)p()siti()11 that whenever there is a revision or modification of 8 it was held that the liability to pay interest is created by the statute. and the Sales Tax Officer has not discretion to exemption from the payment of interest. The pe'1i-altvi"ai§'et'tie--si ~ even for the period during which the :'ef;o've;'y oi7'ut_a>t stiayetl, V
5. In the light of the above"contentions,' tltVe'iiqiges,tions thatiiv would arise for conside1'ati;__on are ' (21) Whether the liable to pay Penalty/interest 1 Act from the date of of the demand under the as '~ti.\,iiftie_i: ii (bi)iiWhetl1e1'».iini of a revised demand notice, the petit.i4one;',does notibeeoine liable and Cannot be construed as a glefzttiiiteii :ft.lI'«.4Cli"\_7\v/l'1t3l'll€lT he stands absolved of payment of pe.r1'dlty and '§.ntei'e;-1§t'_i» -duigiinig service of such demand notice '?
lnsnswetfiiig the above questions, the sequence of events ":i"t>ugh*t.nt)t to be lost sight of. In the instant case, the petitioner has been awoke to the liability that has been fastened on him at all £3 points of time. En that, the petitioner has challenged the order passed in revision under Section 22A as on unsuccessfully before this court and has even rj'iZsch;ii*ge.'dt theis- burden of payment of tax without dernj-hi" Tl1'61't'i"l"()IT:€';'i[lllC', tilingist of it the petitioner's case is sought to be ea__n\}':1ssetl as-.a'~t;L:estio~nVlof_ law namely, whether or not, a f1'esh,de»:nand'notieefis necessary in V the liability to be f21stened:_o'in the liable to pay penalty and interest Whether under Rule 34 of that the assessing passed on the appeal or revision*--,in tax assessed by itself, would require the"-,asvsessing'._ 'lautl1(i:*ity to inandatorily follow the l V' .pt't)eeilu;je.Atotolleet'a-nytadclitional tax in the same mannei' as a tax itse_l_tI_
6.l?Tiie several authoritie-s cited by the learned Counsel for. the lp~<"3titi()f1€I' are not at all pertinent to the issue in the case on 5 and the assessee could. be eoiisidered as 21 defziultei" only if payment is not lllildti within the date specified in the fi'esht(1'ah'a:tsid notice.
(1)) M/s P/tilips Indic'z Limited tutti €11'-I,/).IiifiI£?it'> i;4l;<:,siSvI.rzJ?it' Commissioncr of C01-mnercial Ta;::es','.AIR 2('()5"S.C. 2i8f}4..v in this case, the 'c1p€Xiiii'{:fiO"dI'[ heitl itheiiiiiorigimli assessments having b€6ll._JiE§.€t ;1.isid_e,i.t_ directed" that there should be recomputation_21nd_ the ._oi}_i giii'al"o._if;lers cease to exist. After i'ee()iiipt,1te..tit)ii} fresh .r1(}tices _h 3yiii;g'l:e'en issued, the liability to pay ti1e.t.21Viniot,1_ii't iwtfts 'L:efmfe* tiie____(late§ set out in the fresh notices. Thus, the €ti;)i{)Ciitt1'1iS~.,tiLt»!1ili0liil)€i said to be defaulters unless they had not paidwthe ¢du_es'._Withiin the time specified in those fresh V' '--v_not-i.eies.:»_ And in 'site-it-«ceases, interest cannot be deimmded for an
-._ eiarl.i_e1* periocii; "
I8 ((2') M/.9 M.G.At.m)In()bileS vs. C()l'1Il'II(?f'('i(l[ Tax C)fi'Ft.'€r*. Iieilczrj', [ I 973('2)Mvt'.LJ 285] In this case, the court. after tfeferring to the ratio laid___down in A51--vtzthirzh. N Bros. Vs. Commercial tax <)_ffEc'er, 14 has held that an assessee does not become a defauhei", ifhe C'tt)t§_.$ not make payment of the tax on the due Hdahtes '()1-7' the rett!_1j11s;'--~VBut', b6C()E."fi€S 21 defaultetf only when he does 'n.Qt'~make pétyttjeitt Withit1'--.. the time aliowed by the notice c()r1'Vtev2h;)latedVtlnctgglRuteg of the Kamatzlku Sates Tux RLi1€VS.'t.,._.ti§)56;': .A "
(ti) G01.-'17rzc[ "'1'D'l'?.Fi?.¢S'/II' flats'. .Tijl./i.S'!'1cifftT1l",VWSCIWMLU", I.)har'wad Di.s'fric.'z' (1.r'1t;--'_ czr7()If're r, '('12 TC"i?e.99;-- ' 'fthet..questi_»:)_rithat V':;u'ose for consideration in this case is whe.t_he;_' théi: pa-ir«t_ne1"s of at firm, after dissolution of the firm, are I.i'2thIe--.tt) fj:tj?_"_the'~t.:i§t due from the firm. held that the word 'penalty' used in Section 3 3(2) of ;K22.t°nttt2tka1 Sales Tax 1957, as payable on defauit being 1.9 made to pay tax due, what is payable in reality is the interest on the amount remaining unpaid at the rates specified therein.
(e) Srerlirzg Construction and Y"1'(t.c1z'r'zg Co. vs. C ()1-rm~:eift;i§tf '.3'7:tfi:c.g O_]_7lC'€}", Bangalore, ]973(2) My.LJ 69, In this case, the question raised wastwhetherithe'-in'a'l<ing»:.of an order levying penalty after"afl7Q.:_'dingvan ()pportsL§ii1.i.tyVV to defaulting assessee was a pre--requ.isite.condition«for initiation of proceedings for recovery of penai.tyf':'»i ricnr1ie_éuu*ii_de1' section l3(2) ofthe Act.
It W218 heltltliat in/hei'le'«sthe disetetion is given to an authority to fix the a'1n_o'unt of ili't.___nee'essz11"ily follows that there should be an ;o:~s;E::1~ iinposiing penalty and it also follows that before l13AE].'l'\'.l_,I1lg anxorder, the alleged defaulter should be heard in the mtei~i.i~ I'n:-yofai' as Seggfm Bztclziah 5«S'<E.)rI:"*:'xS' ease, supra, is concerned, g'th'e'sfa<_l::ts of that case are diffe1'ent from the present case, wherein V. i,n..the instant case, the assessment was not reduced, annulled and S also no fresh assessment was directed, but Oniy the originai assessment was restored. Hence, the same does not appiy._tn_ the pI'€f§€'-IN C1186.
Insofar Philips India Linrzireciis ease,. su.pra_;,« i_s'etm.cerne(ii';A the same does not apply to the present e;ise".--_ I_n that,_ca:;e~, th.4e"t.21X*-- amount was reduced and yeoiirts re-
computation. But, in the. zirnntiiit was not modified. 9 V insofaras :s'iif)i'21, is concerned, the same is in the present case is a defaulteijas he the payment of tax within the time stip'tti21ted«« iii£~:i'Iiat-de.nmn(l notice.
-i,i'nsgifa1i'.,_z1s Gir.)'vf--.*--:.--.:2"'Pan..s*/tiis case, concerned, the same i'a1s'(')_r.;'1i()'es:"net~:ij::;31yf,t() the present case on hand as the question in the pif.ese1}.t ~iSfiiWiii€[i16i', the petitioner is Eiabte to pay penalty as a ' V(i'cfttL:ite:'''sinee he had not been served with any demand notice _ r~_af'tei'ihe proceedings before the authority. 3 I») In Sic);-'lmg (.'mz.m'm'Iion '3' case. the assesee therein was not afforcled an opportunity of bei_ng; l'1t3d1'd, but in the p1"es'ertt«._.t:'a.se, the petitioner was heard and an order to pay the tz1>».g'éirm)ijrrfztlorag with the penalty in instalments was pE't'SiS6'£l. l'l."1t',l'l_(,I'€',A'{l4'1f5lSi.l.fnEHl.S not ztpplieable to the present case, Rule 34 ofthe KST Rules__re21ds as...fo"llr>\ztr..s_f:
"34. Communietttion of Appelhlateil(ir.--'Rle»*.E§ir)fi.z1l OI'L1<31'S:-
(1) Every oi'€le_r; '_rof an Ap_§)ellztte'~.i(fa*r._Revisiting Authority under [1SeCti:)_:1512{.l§--'2l' Q1'._22v:A}.."£,1sllthe case. may he, shall be eo_m.1rtt1;tl'i'eai':§:d to_.t'heA"a'ppe_ll:t11tii to every other party ::t't5_eeted_hyi?1he_xorrler,tothe Assessirtg Authority against \Vl10:lC o.rder--the §.ip}5et1l.ilit:.r 1f~3ViS.l013 was filed and to any other au't..hority cs)i1Cz:1;i'i:;dL 2'}f'The-- Q'i'(§Cl'l"]"')i1l"'.l'."'£'C'(;ll on appeal or revision shall be given Assessing /--\uthority who shall. reftmd ll any excess; tax found to have been ll"'*--t:t)lE.feeteu'l and shall collect any additional tax which is 2-Muir to be due, in the same martner as 21 tax assessed by °i_*_'sel 3 22
7. ¥*'roni a plain reading of Rule 34. as rightly contended by the learned Government /-Xdvocate, that the order passed in revision restored the assessment order against the petitioner without either enhancing the tax or reducing the Sé1111€?*I".'.._> The petitioner was fully aware of the order passed. The 'vR;ileViired_t1i'i'«es that the assessing authority shall refund any excess"fr.,).Lin;d'~tt') have i' been collected and collected any additional yitai<'.ow'h'ic'11 is, {?Qai1di;;i be due in the same manner asia-.___tax assessed hy"itse_lf. iglnithe'.
instant case. as already stated, theife'-waspno deriuctionioi' addition of the tax levied by vii'tL1ei"o*Iithe.oi'eiyi.::;io'iia§lorder passed. Hence, the invoeati--I.)'ii of' 'Se:;tioiii'the KST Act was warranted. This Rule thei'efior.e L3.£.1l]E]()Ii3_€i 'r'.;_(i3i'1'1StI'1l€d as requiring the authority to 'Va €r_esh,l_demaiidhotice. It can even he said that there is no _1:>1*oo\_/isioiiiii._L1nde_r"tlie Act or the Rules which require that the p€ii=§l_()fl€1T~SllQ'Llld be served with a fresh demand notice. The ifigour of.p2tyiiie1i_t of interest and penalty is by operation of law the petitioner who was aware of the revisiona} order and has i "made "futile attempts to challe-nge the same cannot escape. the '3