Judgment :- Paripoornan, J. The petitioner/ appellant is a proprietary concern. It is a dealer in cashew. It is an assessee under the K.G.S.T. Act. We are concerned with the assessment year 1975-76. An order of assessment was passed on 30-11-1978. A taxable turnover of Rs.4,23,32,097.04 was determined in Ext. P1 order of assessment. Deducting the tax paid, the balance tax payable was determined at Rs. 13,56,923.96 and deducting the surcharge paid, an amount of Rs. 67,848.20 was determined as surcharge payable. The appeal filed by the petitioner was disposed of by the Deputy Commissioner (Appeals), Agrl. Income tax and Salestax, Kollam, by Ext. P2 dated 5-2-1986. Some modification was made by the first appellate authority. The second appeal filed by the petitioner before the Salestax Appellate Tribunal, Trivandrum was disposed of by Ext. P3 dated 30-3-1987. The order passed in the appeal was given effect to by the assessing authority, by Ext. P4 dated 7-7-1987. The taxable turnover was fixed at Rs. 4,21,86,500/- and a tax liability of Rs. 20,90,510/- was arrived at. After deducting the tax paid, the tax payable was determined at Rs. 11,68,973.50 and after deducting the surcharge paid, the surcharge payable was determined at Rs. 58,447.70. By Ext. P5 dated 29-2-1988, the petitioner was directed to pay the penal interest under S.23(3) of the Kerala General Sales Tax Act in the sum of Rs. 14,36,082.80. In the Original Petition, the attack was against Ext. P5. 2. We heard counsel for the appellant/ petitioner. The main grievance of the counsel for the appellant is that penal interest is calculated for the amount due as per the appellate order, for the period from the date of the original notice of demand. According to counsel, penal interest is become payable only for the amount due as per the appellate order and from the date of the appellate order. 3. It will be useful to extract S.23(1), 23(3) and 23(5) of the Kerala General Sales Tax Act. They are as follows: "23. Payment and recovery of tax: - (1) The tax assessed or any other amount demanded under this Act shall be paid in such manner and in such instalments, if any, and within such time, as may be specified in the notice of demand, not being less than twenty-one days from the date of service of the notice. Payment and recovery of tax: - (1) The tax assessed or any other amount demanded under this Act shall be paid in such manner and in such instalments, if any, and within such time, as may be specified in the notice of demand, not being less than twenty-one days from the date of service of the notice. If default is made in paying according to the notice of demand, the whole of the amount outstanding on the date of the default shall become immediately due and shall be a charge on the properties of the person or persons liable to pay the tax or other amount under this Act: Provided that the time limit of twenty one days for a notice under this sub-section shall not apply to casual traders. (3) If the tax or any other amount assessed or due under this Act is not paid by any dealer or other person within the time prescribed therefore, in this Act or in any rule made thereunder and in other cases within the time specified therefore in the notice of demand, or within the time allowed for its payment by the appellate or revisional authority, as the case may be, or if payment is permitted in instalments by any of the authorities empowered in this behalf, any such instalment is not paid within the time specified, therefore, the dealer or other person shall pay, by way of penal interest, in the manner prescribed, in addition to the amount due, a sum equal to: - (a) one per cent of such amount for each month or part thereof for the first three months after the date specified for its payment; (b) two percent of such amount for each month or part thereof subsequent to the first three months aforesaid. (5). Where, as a result of any order in appeal or revision or any rectification under S.43, any tax assessed or any other amount due from any dealer or other persons has been reduced, the penal interest levied for the non-payment of such tax or other amount shall be proportionately reduced and if any amount of penal interest in excess of such reduced interest has been collected, such excess shall be refunded to the dealer or other person, as the case may be." 4. We are of the view that the tax assessed as specified in the notice of demand is payable as indicated therein, from the date of service of the notice. If default is made in paying the amount according to the notice of demand, the whole of the amount shall become due. It shall be a charge on the properties of the dealer. Penal interest under S.23(3) of the Act is payable on such amount, due from the dealer as per the notice of demand. If any such amount fixed in the order of assessment is reduced in the appeal or revision, the penal interest payable as per S.23(3) of the Act will be limited to the amount that remains payable as per the appellate or revisional order. On a fair reading of the provisions of the Act, it is idle to contend that penal interest under S.23(3) of the Act will become due only from the date of appellate or revisional order. We are of the view that penal interest under S.23(3) of the Act will accrue due and will be payable immediately after the notice of demand is served, in pursuance to the order of assessment and as indicated in the notice of demand. We repel the plea to the contrary. 5. We hold that interest is payable only on the amount of tax due as reduced in the appeals. The learned single judge was of the view that it is not clear from Ext. P5 whether interest has been demanded on the entire amount of tax including the amount reduced in the appeal or on the amount after deducting such reduced tax. Based on this, the learned single judge has directed a fresh quantification by the assessing authority with notice to the appellant/ petitioner. There is no appeal by the Revenue on this aspect of the matter and so it is not necessary for us to consider whether the direction given by the learned single judge is justified. However, we would point out that the liability to pay penal interest under S.23(3) of the Act is automatic and no formal order imposing such interest is necessary. This has been so held by a Full Bench of this Court in Sreekumar v. State of Kerala (1992 (2) KLT 597 FB). However, we would point out that the liability to pay penal interest under S.23(3) of the Act is automatic and no formal order imposing such interest is necessary. This has been so held by a Full Bench of this Court in Sreekumar v. State of Kerala (1992 (2) KLT 597 FB). Another Full Bench of this Court in Abdulla v. Sales Tax Officer (1992 (1) KLT 658 FB) had held that service of notice of demand is not an essential pre-requisite for the levy and collection of penal interest under S.23(1) read with S.23(3) of the Act and the concerned rules. 6. The above Full Bench decisions of this Court are relevant in appreciating the pleas raised before us by the appellant. We are of the view that the learned single judge has shown indulgence to the appellant, in that a fresh quantification of the penal interest due has been ordered after notice to the appellant. It is not necessary that before quantification of the penal interest is made, notice should be served on the assessee; nor is it necessary that the petitioner/ assessee should be heard in the matter. In view of the Full Bench decision of this Court in Sreekumar's case (1992 (1) KLT 597), which is binding on us, the liability to pay penal interest is automatic and no formal order imposing penalty is necessary. In Abdulla's case (1992 (1) KLT 658-FB), this Court has held that service of notice of demand is not an essential pre-requisite for the levy and collection of penal interest. 7. It is in the light of the above two Full Bench decisions, we are of the view that the learned single judge has shown indulgence to the appellant, in stating that before the quantification of penal interest is made, a notice shall be served on the appellant. Since there is no appeal by the Revenue, we do not propose to alter the direction given by the learned single Judge. It is not shown by any tangible material as to how the calculation of the penal interest in Ext. P5 dated 29-2-1988 is in any way wrong or requires interference. 8. Mr. Since there is no appeal by the Revenue, we do not propose to alter the direction given by the learned single Judge. It is not shown by any tangible material as to how the calculation of the penal interest in Ext. P5 dated 29-2-1988 is in any way wrong or requires interference. 8. Mr. N. Venkitarama Iyer, counsel for the appellant submitted that after the decision in the first appeal, where tax has been reduced, a fresh notice of demand should be served on the appellant as laid down by the Supreme Court of India in Income tax Officer v. Seghu Buchiah Setty (52 ITR 538) and so interest will accrue only thereafter. Counsel submitted that the provisions of the Taxation Laws (Continuation and Validation of Recovery Proceedings) Act, 1964 have altered the position. We are unable to accept this plea. In Seghu Buchiah Setty's case, the Supreme Court held that when once a demand raised by the Income-tax Officer was varied by an appellate or revisional authority, the original order of the Income-tax Officer mergers in the order of the superior authority and in all cases of an order varying the assessment the original order falls to the ground and a duty is cast on the Incometax Officer to issue a fresh notice of demand. It is to supersede the decision of the Supreme Court in Seghu Buchiah Setty's case (52 ITR 538) the Taxation Laws (Continuation and Validation of Recovery Proceedings) Act, 1964 was passed. The corresponding State Act is Act 23 of 1967 (The Kerala Taxation Laws (Continuation and Validation of Recovery Proceedings) Act, 1967. The effect of the legislation, at any rate, is to dispsense with the service of a fresh notice of demand in cases where the tax has been reduced in appeal. What is required is only an intimation about the quantum of tax payable as a result of the modification made in the appeal. It has been so done in the instant case, as per Ext. P4 and tax due as per the appellate order has been calculated. The original notice of demand is not superseded by the passing of the appellate order. It is kept alive for amounts due, whatever be, as per the appellate or revisional order. There is no merit in the plea that interest accrues only from the date of the appellate order. The original notice of demand is not superseded by the passing of the appellate order. It is kept alive for amounts due, whatever be, as per the appellate or revisional order. There is no merit in the plea that interest accrues only from the date of the appellate order. The Kerala Taxation Laws (Continuation and Validation of Recovery Proceedings) Act does not say so. 9. There is no merit in this writ appeal. It is dismissed.