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Carryco Road Carrier & Another v. Commissioner Trade Tax, U.P., Lucknow & Another - WRIT TAX No. 625 of 2003  RD-AH 1432 (18 November 2004)
Civil Misc. Writ Petition No.625 of 2003
Carryco Road Carrier and another Vs. Commissioner, Trade Tax U.P. Lucknow and another.
Hon'ble R.K. Agrawal, J
Hon'ble P.Krishna, J
By means of the present writ petition filed under Article 226 of the Constitution of India petitioners seek the following reliefs:-
A. issue a writ, order or direction in the nature of Mandamus commanding the respondents to refund the amount of Rs.2.5 Lacs (2,50,000) with interest as payable under the U.P. Trade Tax Act.
B. issue any other and further writ, order or direction which this Hon'ble Court may deem fit and proper in the facts and circumstances of the case.
C. Award the cost of the writ petition to the petitioners.
Briefly stated the facts giving rise to the present writ petition are as follows:-
The petitioner no.1 is engaged in the business of transporting goods from one place to another. On 22nd December 1994 a consignment of goods was being carried on truck No. WB/25/1782 for outside the State of U.P. It was checked by the Trade Tax Officer, Check Post T.P. Nagar, Ghaziabad who detained the same and issued a show cause notice under section 13A of the Act. Vide order of the same date i.e. 22nd December, 1994 he demanded a sum of Rs.4 Lac as security for releasing the goods. The petitioner No.2 for whom the goods were meant, it is alleged, was in urgent need of the material and therefore they deposited a sum of Rs.2 Lac in cash vide receipt No.642960 dated 5th of January 1995. The bank guarantee for the remaining amount of Rs.2 Lac was also furnished. Subsequently, the Trade Tax Officer vide order dated 22nd December, 1995 converted the amount of Rs.4 Lac demanded as security towards penalty under section 13A (4) of the U.P. Trade Tax Act. The order was upheld in first appeal. However, in second appeal No.507 of 1997 the Tribunal had partly allowed the appeal filed by the petitioners and had reduced the amount of penalty from Rs.4 Lacs to Rs.1.5 Lacs. The balance amount became refundable to the petitioners. After the order dated 1st of September 1998 passed by the Tribunal, the petitioners vide application made on 4th November 1998 requested the Trade Tax Officer, Check Post T.P. Nagar, Ghaziabad to refund the amount of Rs.2,50,000/-. The copy of the Tribunal's order was also enclosed. When the refund was not being granted, petitioners approached this Court by means of the present writ petition.
We have heard Shri M.P. Sarraf, the learned counsel for the petitioners and Shri K.M. Sahai, the learned standing counsel for the respondents. The learned counsel for the petitioner submitted that in view of the order dated 3rd of October, 1998 passed by the Tribunal the petitioners had become entitled to the refund of Rs.2,50,000/- which has been illegally and arbitrarily withheld by the respondents and therefore in view of the provisions of Section 29 of the U.P. Trade Tax Act the petitioners are also entitled for the interest.
The learned standing counsel, however, submitted that against the order dated 3rd of October, 1998 passed by the Tribunal the Commissioner of Trade Tax has preferred a revision before this Court being revision No.119 of 1999 and therefore the respondents did not make the refund. He further submitted that even though there is no interim order passed by this Court in the aforesaid revision, the Department and its Officials had withheld the amount on the pious hope that the Department would succeed in the revision and therefore there will be no occasion to refund the amount to the petitioners. In any even there is no liability for payment of interest as refund has been prepared on 19th of June 2003.
Having heard the learned counsel for the parties we find that it is not in dispute that the petitioners had deposited a sum of Rs.2 Lac in cash and bank guarantee of Rs.2 Lac had been encashed by the Department towards the penalty of Rs.4 Lac imposed. The penalty has been reduced from Rs.4 Lac to 1.5 Lac. Meaning thereby that the petitioners have become entitled for refund of Rs.2.5 Lac on the date when the Tribunal has passed the order i.e. 1.9.1998. Further in view of the provisions of Section 29 of the U.P. Trade Tax Act if the refund is not made within three months from the date of receipt of the order, the assessee is also entitled to simple interest at the rate of 18% per annum from the date of such order till the date of refund.
It may be mentioned here that in the revision No.119 of 1999 filed by the respondents this Court has not passed any order of stay and therefore it was incumbent and obligatory upon the respondents to make the refund. The amount of Rs.2.5 Lac has been refunded by the letter dated 19th June, 2003 and therefore the only question remains regarding the liability of the interest. It is not in dispute that this Court has not passed any interim order either staying the operation of Tribunal's order or restraining the authorities from giving the refund. In this view of the matter in terms of Section 29 (2) of the U.P. Trade Tax Act the petitioners are entitled for refund alongwith the interest from 4th October 1998 till 25th of June, 2003.
In this view of the matter the writ petition succeeds and is allowed in part. The respondent No.2 is directed to pay interest on the amount of Rs.2.5 Lac to be calculated from 4th November 1998 to 25th of June, 2003 within a period of one month from the date of certified copy of this order is filed before him. As the amount of refund and interest have unnecessarily been withheld for no fault of the petitioners, the respondents have exposed themselves for payment of an exemplary cost which is assessed at Rs.10,000/-. The cost may also be paid to the petitioners within the same period.
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