ASHAPURA MINERAL COMPANY v. STATE — 1992 DIGILAW 19 (GUJ)

G. T. NANAVATI, S. D. SHAH, J. ( 1 ) ). In these petitions, the petitioners, who are assesses under the Gujarat Sales Tax Act, 1969 (hereinafter referred to as the act) are challenging the constitutional validity of S. 47 (4a) of the act. In special Civil Application no. 5283/88 the validity of S. 45 (5) is also questioned. ( 2 ) ). The petitioners are all registered dealers under the act. They did not pay the tax due within the prescribed time and / or within the time specified in the notices issued under section 47 (4) of the act. As a result thereof they are called upon to pay interest on the amounts of tax not so paid or on any less amount thereof remaining unpaid. That was challenged by some petitioners by way of appeals, but the same were dismissed. The petitioner question the validity of S. 47 (4a) which provides for payment of interest on amount of tax not paid at the rate of 24% per annum and also the assessment orders or orders passed in appeals in so far as they relate to levy of interest. According to the petitioners, the said provision is ultra vires the legislative powers of the state legislature and also Art. 14, 19 (1) (8) and 300a of the constitution. Section 45 (5) is also challenged on the same grounds. ( 3 ) ). At the hearing of these petitions, learned advocated appearing for the petitioners did not press their contention that section 47 (4a) is ultra vires articles 19 (1) (8) and 300a. no separate submissions were made to show how section 45 (5) is violative of any provision of the constitution. . . What the court is required to consider and decide is a) whether it was beyond the competence of the state Legislature to enact S. 47 (47a); h whether S. 47 (4a) is ultra vires art. 14 and 6 what is the correct interpretation of S. 47 (4a) as regards the date from which or the period for which interest becomes payable. ( 4 ) ). 14 and 6 what is the correct interpretation of S. 47 (4a) as regards the date from which or the period for which interest becomes payable. ( 4 ) ). Section 47 (4a) is challenged on the ground that it has been enacted by the legislature in colourable exercise of its legislative powers the learned advocated appearing for the petitioners stated that they were not challenging the legislative competence of the state legislature to enact this legislation but were challenging the said provision only on the ground that it is really a provision imposing a penalty and the act has not laid down any guidelines for exercise of that power by the sale tax authorities or for holding an inquiry. Competence of the legislature to enact such a provision is not challenged in view of the settled legal position. In Re. Abdul Quador and co. v. Sales Tax officer, AIR 1964 SC 922 , the supreme court has held that the heads of legislation in the various lists in the seventh schedule of the constitution should be interpreted widely so as to take in all matter which are of a character incidental to the topics mentioned therein. It has also held that all powers necessary for the levy and collection of the tax concerned and for seeing that the tax is not evaded are comprised within the ambit of the legislative entry as ancillary or incidental. Payment of interest in case of default in payment of tax is a means of compelling an assessee to pay tax due by prescribed date. It is one of the recognized methods for collection of revenue. Therefore, the power to provide for payment of interest for delayed payment of tax has to be regarded as incidental and ancillary to the power to make provision for levy and collection of tax. Therefore, it will have to be held that the state legislature was within its competence in enacting section 47 (4a ). ( 5 ) ). Validity of S. 47 (4a) is challenged on the ground that the state legislature in enacting the same has acted in colourable exercise of its power. The contention raised by the learned advocates for the petitioners is that S. 47 (4a), though purports to be a provision for levy of interest, in reality and substance is a provision-imposing penalty. ( 6 ) ). The contention raised by the learned advocates for the petitioners is that S. 47 (4a), though purports to be a provision for levy of interest, in reality and substance is a provision-imposing penalty. ( 6 ) ). As we will have an occasion to refer to other parts of section 47 also, we set out the whole of section 47 which is as under:47. payment of tax and deferred payment of tax, etc. a) Tax shall be paid in the manner herein provided, and at such intervals as may be prescribed. b) A registered dealer furnishing declarations or returns as required by sub-section (1) of section 40, shall first pay into a government treasury, in the manner prescribed the whole amount of tax due from him according to such declaration or return alongwith the amount of any penalty payable to him under section 45. c) A registered dealer furnishing a revised declaration or revised return in accordance with sub-sec. 3 of the section. 40 which revised declaration or revised return shows that a larger amount of tax than already paid is payable, shall first pay into a Government treasury the extra amount of tax. c) A registered dealer furnishing a revised declaration or revised return in accordance with sub-sec. 3 of the section. 40 which revised declaration or revised return shows that a larger amount of tax than already paid is payable, shall first pay into a Government treasury the extra amount of tax. d) The amount of tax - due where declaration or return has been furnished without full payment therefore, or assessed ore reassessed for any period under section 41 or section 44 less any sum already paid by him by the dealer in respect of such period, or assessed under section 19 or 50, and the amount of penalty (if any) levied under S. 45 or 46, shall be paid by the dealer or the person liable therefore into a government treasury by such date as may be specified in a notice issued by the Commissioner for his purpose, being a date not earlier than 10 days from the date of service of the notice: provided that the commissioner or an appellate authority in an appeal under section 65 may, in respect of any particular dealer or person, and for reasons to be recorded in writing, extend the date of payment, or allow him to pay tax or penalty by installments: provided further that notwithstanding anything contained in this act or in the rules made thereunder but subject to such conditions as the state government or the commissioner may, by general or special order specify, where a dealer to whom incentives by way of deferment of sales tax or purchase tax or both have been granted by virtue of eligibility certificate granted by the commissioner of industries, Gujarat State of any officer, authorized by him in this behalf and where a lean liability equal to the amount of any such tax payable by such dealer has been raised by the Gujarat Industrial Investment corp. Ltd. Or the Gujarat State Financial Corp. Ltd. Then such tax shall be deemed, in the public interest, to have been paid. Provided that where a penalty is levied under sub-sec. 6 of s. 45 in respect of difference and the period referred to in that sub-section, no interest shall be payable under this sub-section on such difference for such period. Ltd. Then such tax shall be deemed, in the public interest, to have been paid. Provided that where a penalty is levied under sub-sec. 6 of s. 45 in respect of difference and the period referred to in that sub-section, no interest shall be payable under this sub-section on such difference for such period. e) Any tax, penalty or interest which remains unpaid after the date specified in the notice for payment, or after the extended date of payment, and any installment not duly paid, shall be recoverable as an arrears of land revenue. What was urged was that the legislature, by providing payment of interest at a very high rate, has not really tried to compensate the state for deprivation of the use of the amount due and payable to it but has made a deterrent provision for penalizing the dealers. As no provision is made for making an inquiry before imposing penalty and as no guidelines have been laid down by the legislature in that behalf, it should be regarded as bad. f) In Associated Cement Co. Ltd. V. Commercial Tax Officer, Kota (1981) 48 STC 466, the Supreme Court has pointed out the differences between penalty and interest. As observed by the Supreme Court, penalty ordinarily becomes payable when it is found that an assessee has willfully violated any of the provisions of the taxing statute. Interest is ordinarily claimed down from an assessee who has with held payment of any tax payable by him and it is always calculated at the prescribed rate on the basis of actual amount of tax withheld and extent to delay in paying it. Such interest is compensatory in character and not penal. Moreover, in Khazan chand v. State of Jandk, 1984 56 STC 214, the Supreme Court has observed that payment of interest in case of default in payment of tax is a means of compelling an assessee to pay tax by a prescribed date. ( 7 ) ). If we compare sec. 45 and sec. 47 (4a) in light of these observations of the Supreme Court, S. 47 (4a) is not in reality a provision for imposition of penalty. It is a provision for payment of interest by a dealer who does not pay tax within the time prescribed for its payment, or on or before the date specified in the notice issued under sub-sec. 4. It is a provision for payment of interest by a dealer who does not pay tax within the time prescribed for its payment, or on or before the date specified in the notice issued under sub-sec. 4. The liability to pay interest arises when tax becomes due, either as a result of furnishing of declaration or return by the dealer or on assessment or re-assessment, as the case may be. Interest is made payable on that amount of tax which ought to have been paid earlier, i. e. within the prescribed time or the specified period and which has not been paid. Interest is made payable because government to that extent is deprived of use of money which otherwise it could have got at an early point of time. The liability arising under s. 47 (4a) is absolute in nature. Rate of interest payable is fixed by the legislature itself and no discretion in that behalf is left with the sales-tax authorities. Once it is found that the dealer has not paid tax within the prescribed time, and/or within the prescribed period, the liability to pay interest arises under the act and it is not open to the sales tax authorities to waive its payment for any reasons. For levy of penalty, a separate provision has been made by the Legislature. It could have provided for levy of penalty at a higher rate in section 45 itself and it was not necessary for them to enact section 47 (4a) for that purpose. The rate of interest is also not so high that we can say that it is not really compensatory in nature but in penal. If we keep in mind the purpose for which the withheld amount can be utilized by the state government, the prevailing rate of interest in the market, the rate of 24% per annum cannot be regarded as too high to retain its compensatory character. For all these reasons we hold that Section is in reality and substance not a provision for imposition and levy of penalty and therefore, it was not necessary for the legislature to lay down guidelines and to provide for any inquiry. ( 8 ) ). As regards the challenge based upon article 14, the learned counsel drew our attention to sec. ( 8 ) ). As regards the challenge based upon article 14, the learned counsel drew our attention to sec. 47 (4a) and section 54 of the act and submitted that both these provisions are compensatory in nature and therefore, the treatment which should be given to the dealers under Section 54, interest becomes payable to the dealer within 35 days if the amount is required to be refunded by virtue of an order of assessment under section 41 and within 90 days if it becomes payable by virtue of any other order. Thus, there is discrimination not only with respect to the rate of interest but also with respect to the date from which it becomes payable. In support of their contention, the learned counsel first relied upon the decision of the Supreme Court in Associateds case wherein it is held that ordinarily interest which is claimed from an assessee who has withheld payment of any tax payable by him is compensatory in character. The learned counsel then relied upon the following observation of the Supreme Court in the case of Khazan. In this connection, it is pertinent to note that section 10-B of the act, where as a result of an order made in appeal or revision, a refund has become due to the dealer or any other person on account of tax or penalty found to have been paid in excess, the state government is required to pay to such dealer or person simple interest at the rate of 12% per annum on the amount of such refund was granted and in case in delay in refunding the excess amount, interest at the rate of 24% per annum if the refund is granted beyond the expiry of six months from the date of appellate or revisional order and at the rate of 36% per annum if it is granted thereafter. Thus, under the act the same rates of interest apply both to the dealer who has made default in payment of tax due to him and to the State Government in case of default made by it in making payment of the amount of tax or penalty which has become refundable as a result of an appellate or revisional order. The graduated rates of interest provided by Sub-sec. 2 of Sec. 8 cannot, therefore, be characterized as arbitrary or unreasonable. The graduated rates of interest provided by Sub-sec. 2 of Sec. 8 cannot, therefore, be characterized as arbitrary or unreasonable. We have already held that the provision for payment of interest made in section 47 (4a) is compensatory in character. But it is not possible to accept the further contention that the object of section 47 (a) and section 54 being the same, the dealer and the department must be treated in a similar manner. In our opinion, the decision of the Supreme Court in Khazans case does not lay down that if the rate of interest is different for the dealer who has made default in payment of tax due by him, from the rate which the State Government has to pay while making payment of the amount of tax or penalty which has become refundable, then such a provision must be characterized as arbitrary or unreasonable. The Supreme Court made the aforesaid observations while considering the contention regarding the legislative power of the state legislature to make a law providing for payment of interest if the amount of tax is not paid by the prescribed time, and the contention that sub-sec. 2 of section 8 of the Jammu Kashmir General Sales-tax Act, 1962 was violative of art. 14 of the constitution inasmuch as it was discriminatory and also arbitrary and unreasonable. The said sub-section was challenged as discriminatory for the reason that it provided for high rate of interest for non-payment of tax even though no such provision existed in any other state legislation. It was challenged as arbitrary or unreasonable on the ground that the rate of interest was very much on the higher side. The Supreme Court also held that payment of interest in case of default in payment of tax is a means of compelling the assessee to pay the tax due by the prescribed date. It is a method adopted by the state for collecting its revenue and that is for the state to provide by what means payment of tax is to be enforce. The Supreme court has also observed that it neither lies in the defaulters mouth to protest against the rate of interest charged to him nor is it open to him to dictate to the state the methods which it should adopt for recovering the amount of tax due by him. The Supreme court has also observed that it neither lies in the defaulters mouth to protest against the rate of interest charged to him nor is it open to him to dictate to the state the methods which it should adopt for recovering the amount of tax due by him. If the above quoted observations of the Supreme Court are read alongside these observations, it becomes apparent that the support which the learned counsel seeks from this decision is really not available to them. Provision for payment of interest being a method for collecting or recovering its revenue, it is for the state to decide what is most efficacious for this purpose, and the defaulter has no moral right to make any grievance in this behalf. If the rate of interest fixed for non-payment of tax within time is not unreasonably high, then it cannot be said to be arbitrary or unreasonable. ( 9 ) ). The decision of the Supreme Court in Collector, Land Acquisition, Anantnag v. Mst. Kantiji and Ors. 1987 66stc 228 relied upon by the petitioner is also, in our opinion, of no use. In that case the question which had arisen was whether the same standard should be adopted in applying sufficient cause. Test to all the litigants. The states application for condonation of delay was rejected and in that context, the Supreme Court observed that the fact that it was the state which was seeking condonation and not a private party was altogether irrelevant. It future observed that the doctrine of equality before law demands that all litigants, including the state as a litigant, are accorded the same treatment and the law is administered in an even handed manner, and there is no warrant for according a step-motherly treatment when the state is the applicant praying for condonation of delay. As the provision which fell for consideration of the Supreme Court was different, the observations made therein have no relevance, particularly when the object and the nature of the provisions are, as stated above, quite different. ( 10 ) ). Reliance placed on the decision of the Supreme court in Ary Vaidya Pharmacy and another v. State of T. N. 1989 73 STC 345 is also, in our opinion, misplace. ( 10 ) ). Reliance placed on the decision of the Supreme court in Ary Vaidya Pharmacy and another v. State of T. N. 1989 73 STC 345 is also, in our opinion, misplace. In that case what had happened was that different rates of sales-tax under the TN General Sales Tax Act, 1959 for Artishtams and Asavas which are ayurvedic medicinal preparations were applied. The Supreme Court in that case held that Arishtams as Asavas being ayurvedic medicinal preparations, there was no reason why they should be treated differently from the general class of ayurvedic medicines. The supreme court pointed out that the reasons behind the higher rate of 30% on the turnover of Arishtams and asavas did not constitute good ground for taking these two preparations out from the general class of medicinal preparations to which a lower rate of tax had been applied. It further observed that though it was open to the authorized in that behalf by the legislature, to select different rates of tax for different commodities, where the commodities belong to the same class or category, there must be a rational basis for discrimination between one commodity and anther for the purpose of imposing tax. ( 11 ) ). In our opinion, there is a difference between a dealer defaulter who does not pay tax within the prescribed time and the state which has to refund the amount of excess tax paid either voluntarily by the assessee or as a result of an assessment order. Since both of them do not stand on the same footing, different rates of interest and different periods from which it becomes payable, can validly be provided by the legislature so long as the, for some other reasons, they are not arbitrary or unreasonable. ( 12 ) ). The view which we are taking also gets support from the decision of the Supreme Court from the decision of the Supreme Court in Saghir Ahmed and Another v. State of U. P. and ors. AIR 1954 SC 728 to which our attention has been drawn by the learned advocate general. ( 12 ) ). The view which we are taking also gets support from the decision of the Supreme Court from the decision of the Supreme Court in Saghir Ahmed and Another v. State of U. P. and ors. AIR 1954 SC 728 to which our attention has been drawn by the learned advocate general. In that case it is held that mere differentiation does not make a legislation obnoxious to the equal protection clause, and that even when the state ceases to function as a state and engages itself in a trade like ordinary trader, it can be treated in a different manner if such a differentiation has a rational relation to the object of the statute. The learned advocate general also relied upon the following observation of the supreme court in the case of Manna Lal and another v. Collector of Jhalawar and ors AIR 1961 SC 828 : The last point argued was that in so far as the act enables money due to the government in respect of its trading activities to be recovered by way of public demand, it offends article 14 of the constitution. It is said that the act makes a distinction between other bankers and a government as a banker, in respect of the recovery of moneys due. It seems to us that the government, even as a banker, can be legitimately put in a separate class. The dues of the government of a state are dues of the entire people of the state. This being the position, a law giving special facility for the recovery of such dues cannot, in any event, be said to offend art. 14 of the constitution. ( 13 ) ). In Nav Ratanmal and ors v. State of Rajasthan AIR 1961 SC 1704 , the Supreme court has held that a distinction can be drawn between the claims of the state and the claims of the individual in the matter of a provision of a bar of limitation for enforcing them. 14 of the constitution. ( 13 ) ). In Nav Ratanmal and ors v. State of Rajasthan AIR 1961 SC 1704 , the Supreme court has held that a distinction can be drawn between the claims of the state and the claims of the individual in the matter of a provision of a bar of limitation for enforcing them. firstly, because in the case of the government when claims becomes barred by limitation, the loss falls on the public, i. e. on the community in general and to the benefit of the private individual who derives advantage by the lapse of time, and secondly, because in case of government machinery it is a known fact that it does not move as quickly as in case of an individual. ( 14 ) ). The learned Advocate General also relied upon the full bench decision of this court in C. N. Bros. V. Income-tax Commissioner AIR 1961 Guj. 144 . That was a case arising under the Bombay court-fee act. The provision which provided for payment of court-fees when he goes to a high court with an application under that provision. A state is vitally interested in income-tax levied and collected by the union. Whether it is the union or the state government which is the party, it is a party which is very much interested in collecting income-tax. State itself imposes court-fees and there can be nothing objectionable in enacting that the commissioner of income-tax should not be under the obligation of pay court fees under entry 15 schedule 1 of the court-fees act when he prefers an application under section 68 (2) to the high court. The object of the levy of court fees is administration of justice and there is nexus between the basis of classification and the object of the provision in question. Though this decision has no direct bearing on the question raised before us, it does to some extent support the contention raised by the learned Advocate General. ( 15 ) ). In our opinion, the dues of the government of a state being the dues of the entire people of the state, there is a valid basis for differentiation between the dues of the government of a state and the dues of an individual. Whereas the state government utilizes its funds for public welfare as individual ordinarily uses money, for his private purposes. Whereas the state government utilizes its funds for public welfare as individual ordinarily uses money, for his private purposes. The legislature was thus justified in treating the state government as a separate class and providing for a higher rate of interest on the dues of the Government of the State. For these very reasons, it will have to be further held that even when interest on the dues of the government is payable from an earlier date than the date from which interest on the refund to a dealer becomes payable, it cannot be said that the said differentiation is discriminatory and violative of art. 14 of the constitution. ( 16 ) ). It was lastly submitted that section 47 (4a), on its true interpretation, should apply to those dealers who do not furnish declarations or returns and thus do not pay any sales tax and to those dealers who furnish declarations and returns but do not pay sales tax admittedly payable according to the declarations or returns within the prescribed time. It was submitted that the said section would also apply to those dealers who do not pay the difference even after receiving a notice under section 47 (4) of the act. In other words, it was submitted that section 47 (4a) cannot apply to a dealer who pay tax according to his declaration or return and pays the difference even though the same being more than 20% within the specified time. By way of example, the learned counsel stated that if a dealer pay Rs. 1000 as sales tax as per his declaration or return, he cannot be said to have paid the tax within the time prescribed for its payment even though on assessment it is subsequently found that he ought to have paid Rs. 1000 as sales tax. According to sub-section 2, a registered dealer furnishing declarations or returns has t to pay the whole amount of tax due from him according to such declarations or returns. Similarly according to sub-sec. 3 a registered dealer furnishing a revised declaration or revised return has to pay the extra amount of tax as per the revised declaration or revised return. Sub. sec. Similarly according to sub-sec. 3 a registered dealer furnishing a revised declaration or revised return has to pay the extra amount of tax as per the revised declaration or revised return. Sub. sec. 4 provides that if the amount of tax due where declarations or returns have been furnished without full payment thereof or assessed or reassessed for any period under section 4 or section 44 less any sum already paid by the dealer in respect of such period or assessed under section 19 or 50 shall be paid by the dealer by such date as may be specified in the notice issued by the commissioner for this purpose. Thus, the scheme of section 47 as disclosed by these provisions is that only that amount of tax which is shown payable under the declarations or returns is required to be paid by the dealer initially and at that stage he is not expected to pay the tax as may be found due and payable subsequently. ( 17 ) ). The learned counsel also drew our attention to rule 3 which provides for time for payment. Subrule 1 provides that every dealer to whom subrule. 1a does not apply and who is required to furnish the monthly and quarterly return or declaration shall within the period of one month and seven days immediately succeeding the month or quarter for which any such return or declaration is required to be furnished pay into the government treasury the tax due and payable in such month or quarter alongwith the amount of any interest payable by him under subsection4a of section 47 and shall submit to the officer one copy of the receipted challan inform 33 alongwith the return, or , as the case may be, declaration required to be furnished under rule 25 or 26 or 37. Thus according to the learned counsel, the law permits payment of tax due and payable within one month and seven days immediately succeeding the month or quarter for which return or declaration is required to be furnished. It was submitted that rule 33 also supports the petitioners contention as the amount of tax remaining unpaid is to be paid within the time which may be fixed by the notice. It was submitted that rule 33 also supports the petitioners contention as the amount of tax remaining unpaid is to be paid within the time which may be fixed by the notice. Though section 45 deals with penalty, the learned counsel drew our attention to subsec 5 and 6 of that section, Subsection 5 provides that where in a case of a dealer the amount of tax assessed or reassessed exceeds the amount of tax already paid under subsec 1,2 or 3 of sec. 47 by the dealer in respect of such period by more than 20% of the amount of tax so paid, the dealer shall be deemed to have failed to pay the tax to the extent of the difference between the amount so assessed or reassessed and the amount paid. The learned counsel submitted that the legislature after creating the fiction like this has further provided in sub-sec. 6 that where a dealer is deemed to have failed to pay the tax to the extent mentioned in the said subsection, there shall be levied on such dealer a penalty of such amount of simple interest for the period commencing on the date of expiring of the time prescribed for payment of tax under subsec. 1,2, or 3 of section 47, and ending on the date of assessment or, as the case may be, reassessment, at the rate of 24% per annum on the amount of tax contemplated by subsec 4a is not the whole amount which on assessment or reassessment is found due, payable and not paid. Inspite of that the department is demanding interest on the difference found on assessment or reassessment even from those dealers who have paid tax according to their declarations or returns within the prescribed time and who have paid the difference within the time specified in the notices contemplated by the act and the rules. ( 18 ) ). The basis of the petitioners contention is that only that amount of tax, which is shown payable under the declarations, or returns, become due and payable at the time of filing of the declarations or returns. Under the act, tax is payable on the sale or purchase of goods liable to be taxed subject to other conditions specified in the Act. In the case of sales-tax, taxable even is the sale of goods. Under the act, tax is payable on the sale or purchase of goods liable to be taxed subject to other conditions specified in the Act. In the case of sales-tax, taxable even is the sale of goods. Therefore, subject to other conditions being fulfilled sales-tax becomes due and payable as soon as the sale takes place. Merely because the stage of payment or collection of tax is postponed, it cannot follow therefrom that the sales-tax becomes due and payable only at that stage. It would only mean that the sales-tax has to be paid at that stage and not before. Section 47 provides for payment of tax which has already become due and payable. Reading of this section alongwith Rule 37a makes it clear that the tax which has become due, has to be paid alongwith the declarations or returns which are required to be filed within the prescribed time. The provision for filing a revised declaration or return is for the benefit of the dealer. Therefore, this provision, which provides for the stage of payment of tax due, cannot be interpreted to mean that the whole amount of tax does not become due at the stage when the sale takes place. In Kedarnath Jute Mfg. Co. Ltd. V. Commissioner of Income-tax (1971) 28 STC 672, the Supreme Court has held that the moment a dealer made either purchases or sales which are subject to sales-tax, the obligation to pay the tax arose. Although that liability could not be enforced till qualification was effected by assessment proceedings, the liability for payment of tax was independent of the assessment. The contention based upon the words of sub-Sec. (2) OF section 47, namely, the whole amount of tax due from him according to such declarations or returns is thus not tenable. Moreover, the declarations or returns which are required to be filed by the dealer are intended by the Legislature to be true and correct declarations or returns. There is nothing in Section 47, which can support the contention of the petitioners that it is open to the dealer to file such declarations or returns as are believed to be proper by him. Non-filing of true and complete declaration or return would, apart from other consequences, invite a penalty. There is nothing in Section 47, which can support the contention of the petitioners that it is open to the dealer to file such declarations or returns as are believed to be proper by him. Non-filing of true and complete declaration or return would, apart from other consequences, invite a penalty. This would also suggest that the dealer is expected to file a true and complete declaration or return in respect of his turnover and pay correct amount of tax which has become due and payable. The Supreme Court in Associated Cement Companies case (supra) construed the words, on the basis of return occurring in sub-Sec. (2) of Section 7 of the Rajasthan Sales-tax Act as on the basis of true and proper return which ought to have been filed. Construing the said words that way, the Supreme Court further observed that:. . ALL the three classes of persons, viz. (i) those who have not filed any return at all and who are later on found to be liable to be assessed, (ii) those who have filed a true return but have not deposited the full amount of tax which they are liable to pay and (iii) those who have filed a return making a wrong claim that either the whole or any part of the turnover is not taxable and who are subsequently found to have made a wrong claim, would be placed in the same position and they would be liable to pay interest on the amount of tax which they are liable to pay but have not paid as required by sub-Sec. (2) of Section 7 of the Act. We are of the opinion that this view is in conformity with the legislative intention in enacting Section 11b of the Act. Thus, according to the scheme of the act what is required to be done b the dealer is to file true and complete declaration or return and pay alongwith it the proper amount of sales tax becoming due and payable. If he does not pay the correct amount at that time, then it can be said that the state government is deprived of that much money till the same is paid. If he does not pay the correct amount at that time, then it can be said that the state government is deprived of that much money till the same is paid. Therefore, if the legislature, with a view to prevent such a situation or to make good the loss likely to be suffered by the State Government, has thought it fit to provide for payment of interest on such amounts, than not only such a provision has to be regarded as reasonable but it will also have to be interpreted in a manner which would achieve that object. We, therefore, hold that on true interpretation, S. 47 (4a) does provide for payment of interest right from the time of filing of the declaration or returns or from the date of expiry of the specified date, as the case may be, and that the sales-tax authorities cannot be said to have acted illegally in demanding interest accordingly. Therefore, neither their action nor their orders passed in this benefit can be said to be illegal or bad. ( 19 ) ). As we do not find any substance in the contentions raised on behalf of the petitioners, these petitions fail. Rule issued in each of these petitions is discharged with no order as to costs. (RPV) Rule discharged. .