Civil Writ Petition No. 6260 of 1989 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. --- Civil Writ Petition No. 6260 of 1989 Date of decision: 7.1.2011 State of Punjab and another --- Petitioners Versus New Samundari Transport Company and another --- Respondents CORAM: HON’BLE MR. JUSTICE ADARSH KUMAR GOEL HON’BLE MR. JUSTICE AJAY KUMAR MITTAL --- Present: Mr. Jaswinder Singh, Deputy Advocate General, Punjab for the petitioners. Mr. Baldev Kapoor, Senior Advocate for respondent No.1. --- AJAY KUMAR MITTAL, J. In this petition filed under Articles 226/227 of the Constitution of India, the petitioners have prayed for issuance of a writ in the nature of certiorari for quashing order dated 25.3.1987 passed by the Collector, Ferozepur, exercising the powers of appellate authority under the Punjab Motor Vehicles Taxation Act, 1924 (for short “the 1924 Act”), and a writ of mandamus, directing the New Samundari Transport Company Private Limited, Ferozepur (hereinafter referred to as “the respondent-company”) to pay a sum of Civil Writ Petition No. 6260 of 1989 2 Rs. 35,255.96 which was charged as punitive interest on delayed payment of instalments in terms of order dated 22.1.1981 passed by the Commissioner, Ferozepur Division, Ferozepur. As per the facts emerging from the record, the respondent- company is assessable to tax under the 1924 Act. The District Transport Officer, Ferozepur, by order dated 3.9.1984, assessed the respondent-company to pay an amount of Rs. 35,255.96 as punitive interest in respect of delayed payment of instalments pursuant to an order dated 22.1.1981 passed by the Commissioner, Ferozepur Division, Ferozepur. The respondent-company preferred appeal against the said order before the Collector, Ferozepur. It was argued before the Collector on behalf of the respondent-company that in the order dated 22.1.1981, the Commissioner had allowed the respondent-company to pay the due amount in instalments of Rs. 10,000/- each by the 15th of every month besides paying the regular tax and had further ordered that in the eventuality of failure to pay any of the instalments, penal interest at the rate of 24% per annum, as advised by the State Transport Commissioner, Punjab would be leviable on the respondent-company. It was further contended before the said appellate authority that the penal interest at the rate of 2% per month in terms of Section 9 of the Punjab Motor Vehicles Taxation (Amendment) Act, 1983 was chargeable on instalments which were to be paid after 1.10.1983 whereas on the instalments paid prior to that date, lenient view deserved to be taken in view of slouch in the transport business due to worse situation of law and order in the State of Punjab. The submission made before the Collector on behalf of the Civil Writ Petition No. 6260 of 1989 3 respondent-company was opposed on behalf of the appellants, but the Collector, while accepting the appeal of the respondent-company, by order dated 25.3.1987, modified the order appealed-against, ordering that penal interest at the rate of 24% per annum shall be chargeable on the delayed payment of instalments paid after 1.10.1983 and at the rate of 12% per annum on instalments paid before that date. The amount charged in excess was ordered to be adjusted against the dues payable by the respondent-company. In the written statement filed on behalf of the respondent- company, there is a simple denial that any interest was payable on the delayed payment of instalments. An endeavour has been made to demonstrate that there was no provision either in the Act or the Rules framed thereunder envisaging levy of interest and as such no interest was recoverable from the respondent-company. The respondent- company challenged the competency of the State Transport Commissioner, Punjab to pass any order or issue instructions under the 1924 Act directing penal interest from it. We have heard learned counsel for the parties and have perused the record. A perusal of the order of the Collector dated 25.3.1987, Annexure P-1, shows that there was no dispute between the parties before any of the authorities that the respondent-company had defaulted in making payment of some instalments of the amount due from it and also about the fact that in that eventuality penal interest was to be imposed on the delayed payment of instalments. The only dispute was with regard to quantum of penal interest. Even the stand Civil Writ Petition No. 6260 of 1989 4 taken on behalf of the appellants before the Collector was that penal interest at the rate of 24% per annum had been rightly imposed as per the advice of the State Transport Commissioner, Punjab, whereas the respondent-company claimed leniency and prayed for exemption from payment of penal interest, on the ground of worse situation of law and order. A perusal of the appellate order, which is the subject matter of challenge in this writ petition, no where shows that the respondent- company had ever disputed that there was no provision in the Act to charge penal interest or the authorities under the Act were lacking in competency to charge the penal interest. The only dispute between the parties throughout had been about the quantum of penal interest. The Collector in his wisdom as an appellate authority under the Act, having regard to the submissions made on behalf of the respondent- company, accepted the plea of the latter and taking the reason brought forward as a mitigating circumstance, charged penal interest at the rate of 24% per annum on the delayed payment of instalments paid after 1.10.1983 and at the rate of 12% per annum on instalments paid before that date. It was further ordered that the amount charged in excess would be adjusted against the dues payable by the respondent-company. Learned counsel for the petitioner has not been able to persuade this Court that the approach adopted by the Collector, as an appellate authority under the Act, was perverse or erroneous. The Collector in the facts and circumstances of the cases had held that on the delayed payment of instalments paid before 1.10.1983, penal interest at the rate of 12% per annum would be charged. We find no Civil Writ Petition No. 6260 of 1989 5 error of law in the exercise of discretion by the appellate authority, nor the same has otherwise been shown to be against law. In view of the above, there is no merit in the writ petition and the same is dismissed, leaving the parties to bear their own costs. (AJAY KUMAR MITTAL) JUDGE (ADARSH KUMAR GOEL) January 7, 2011 JUDGE *rkmalik*