The High Court
Case Details
IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C) No.6382 of 2025 M/s. Indera Motors, Rourkela …. Petitioner -Versus- The Commissioner of Commercial Taxes, CT and GST, Odisha and Others …. Opposite Parties Advocates appeared in this case: For Petitioner
Legal Reasoning
: Mr. Sidhartha Ray, Senior Advocate Mr. K.K. Sahoo, Advocate For Opposite Parties : Mr. Sunil Mishra, Senior Standing Counsel CORAM: THE HON’BLE THE CHIEF JUSTICE AND THE HON’BLE MR. JUSTICE B.P. ROUTRAY J U D G M E N T -------------------------------------------------------------------------------------- Date of hearing and judgment: 8th April, 2025 -------------------------------------------------------------------------------------- HARISH TANDON, CJ. 1. The demand for payment of interest @ 9% from the date of filing of the return is raised against the petitioner by the Joint Commissioner W.P.(C) No.6382 of 2025 Page 1 of 7 of Sales Tax, CT & GST Circle, Rourkela II, Panposh vide letter No.2327/CT & GST dated 05.02.2025. 2. The challenge is made to the said demand on multiple grounds including that the spate of litigations initially poured in docket of this Court assailing the demand of the entry tax under the Orissa Entry Tax Act, 1999 (OET Act) and the same was decided in favour of the assessee upholding their contention was held to be intra vires and further directions were passed in relation to the modalities of the transactions ensued within and outside the State of Odisha. 3. The matter travelled to the Apex court and an interim order was passed directing the assessee to pay 1/3rd of the demand and the rest portion of the demand was kept in abeyance until the final decision is taken. It is not in dispute that a civil appeal was disposed of by the Supreme Court on 28th March, 2017 upholding the vires of the Act and the competence of the department to impose tax in relation to the transactions as specified therein. 4. Despite the decision having taken by the Apex Court, the litigation did not receive quietus as batch of writ petitions were filed before this Court, assailing the decision to imposition of the interest WPC No.6382 of 2025 Page 2 of 6 from the period as demanded by the department. Admittedly, the petitioner was one of the litigants in the said batch of writ petitions which were disposed of on 15th March, 2023 with two directions; firstly, the remaining amount equivalent to 2/3rd of the demand shall be paid with an interest from the date of the order of the Supreme Court. Secondly, so far as the interregnum period from the date of filing of the return till the judgment of the Supreme court as aforesaid, compensatory interest @ 9% shall be charged on the assessee by the department. 5. The matter has now travelled to the Apex Court both at the behest of the Department as well as some of the assessees and the leave have already been granted and the civil appeal is now pending. It is not in dispute that the interim order to the effect that no coercive step shall be taken against the assessee-petitioner, who approached the Supreme Court, is also passed. 6. The petitioner contends that since the Apex court has passed an interim order as aforesaid, it would inure to the benefit of all the assessees whether made party in the civil appeal or not as such order is to operate in rem or not in personem. According to learned Senior Counsel appearing for the petitioner, since the Apex court is in seisin of Page 3 of 6 WPC No.6382 of 2025 the matter and an interim order has been passed, the Department cannot raise demand on interest for such interregnum period. It is further submitted that the remaining 2/3rd amount of tax along with the interest has already been deposited by the petitioner after the judgment of the Supreme Court and, therefore, the petitioner cannot be termed as a defaulter in discharge of its obligation foisted upon it under the statute. 7. Mr. Sunil Mishra, learned Standing Counsel appearing for the opposite party-Department refuted the contentions of the petitioner in contending that the petitioner has not approached the Apex Court against the order of this Court passed on 15th March, 2023 and, therefore, cannot reap the benefit of the interim order. In other words, it is sought to be contended that the interim order is restricted to the petitioners, who have filed the special leave petition before the Supreme Court and, therefore, to be construed as an order in personem and not in
Decision
rem. It is further submitted that once the writ petitioner has accepted the order of the Court dated 15th March, 2023 having not challenged before the apex court, the instant writ petition is in fact filed seeking review of the said order, which is impermissible in law. 8. On the conspectus of the aforesaid submission so advanced, it is no longer in dispute that a batch of writ petitions including the writ Page 4 of 6 WPC No.6382 of 2025 petition filed by petitioner were disposed of by a common judgment passed by this Court on 15th March, 2023 and the petitioner till date has not assailed the said order before the Apex Court. 9. We have not been taken to any material that the operation of the said order is stayed by the Apex Court but the interim order is passed against the department not to take any coercive step for non-deposit of the interest/principal amount in respect of the petitioner of the said special leave petition. Whether the High Court was within its competence to direct the compensatory interest to be levied on the assessee for the interregnum period between the date of filing of the return and the judgment of the Apex Court, is a matter to be decided by the Apex Court. Since there is no express order of stay of operation of the said order and the petitioner being not an applicant in any of the special leave petitions pending before the Supreme Court, we do not find any justification in extending the benefit of the interim order at this stage. Furthermore, in order to bring equilibrium between the rights of the parties, any deposit as demanded would sub serve the justice as the same would be subject to an outcome of the decision taken by the apex Court provided it inure to the benefit of all the assessees whether they approached the apex Court or not. We are conscious that because of the WPC No.6382 of 2025 Page 5 of 6 confusion having created in the mind of the several assessees on the applicability of the interim order, we feel that an opportunity should be given to the petitioner to deposit the said demand within two months from today. Such deposit shall be without prejudice to the rights and contentions of the parties. 10. With these observations, the writ petition is disposed of. No order as to costs. Chief Justice ( Harish Tandon ) Judge ( B.P. Routray ) SK Jena/Secy. Signature Not Verified Digitally Signed Signed by: SANJAY KUMAR JENA Designation: SECRETARY Reason: Authentication Location: High Court of Orissa, Cuttack. Date: 09-Apr-2025 18:04:16 WPC No.6382 of 2025 Page 6 of 6