CWP No.8740 of 1992 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. CWP No.8740 of 1992 Date of decision: 21.9.2010 M/s Ashoka Industries -----Petitioner Vs. State of Haryana and others ----Respondents CORAM:- HON'BLE MR JUSTICE ADARSH KUMAR GOEL HON’BLE MR. JUSTICE AJAY KUMAR MITTAL Present:- Mr. Avneesh Jhingan, Advocate for the petitioner. Ms. Palika Monga, DAG, Haryana. Adarsh Kumar Goel,J. 1. This petition seeks quashing of order of assessment as upheld by Sales Tax Tribunal, Haryana, under the provisions of Haryana General Sales Tax Act, 1973 for the assessment year 1984-85. 2. During the assessment, the Assessing authority raised an additional demand of tax by including turnover of paddy husk, rejecting the plea of the assessee that the said item was covered by fodder under Entry 34 Schedule B and was exempt from tax. On the additional demand of tax, interest was also levied and order of penalty was also passed. 3. At the time of hearing, learned counsel for the petitioner stated that he presses the issue only of penalty and interest. He submitted that on the issue of interest, the matter was covered in favour of the assessee by judgment of the Hon’ble Supreme Court in J.K.Synthetics Limited v. Commercial Taxes Officer, (1994) 94 STC 1 CWP No.8740 of 1992 422, holding that if tax is paid as per return, on additional demand of tax, interest will accrue only from the date of demand. He further submitted that on the issue of penalty, matter was covered by judgment of the Hon’ble Supreme Court in E.I.D Parry (I) Limited v. Assistant Commissioner of Commercial Taxes and another, (2000) 117 STC 457, holding that if an assessee is acting on a bonafide belief based on doubtful position of law, levy of penalty was not called for. 4. We find merit in the contention raised on behalf of the petitioner. 5. Learned counsel for the State has not been able to dispute applicability of the judgments relied upon on the issue of interest and penalty. 6. Accordingly, we allow this petition to the extent of levy of penalty and interest. (Adarsh Kumar Goel) Judge September 21,2010 (Ajay Kumar Mittal) ‘gs’ Judge 2