Judgment

Ruma Pal, J.—The issue to be decided in these appeals is whether the appellant is liable to pay interest on the balance of sales tax dues for the period 1.10.93 to 30.9.94 under Section 24(3) of the Tamil Nadu General Sales Tax Act, 1959 or was it exempt from doing so under Section 17A(2) of that Act?

2. The appellant-company is a registered dealer under the Tamil Nadu General Sales Tax Act, 1959. Sometime in 1988 proceedings were commenced in respect of the appellant under the Sick Industries Companies (Special Provisions) Act, 1985. (referred to hereafter as SICA). Ultimately on 28th September, 1993 a scheme was sanctioned by the Board of Industrial and Financial Reconstruction (hereinafter referred to as ‘BIFR’) for rehabilitation of the appellant. Under the heading, “Cost of the scheme and Means of financing”, the BIFR noted the requirement of funds for the rehabilitation of the Appellant and the means of finance. As far as the requirements of funds are concerned it was assessed at Rs. 1491 lakhs. To meet this requirement, the means of finance from three sources were identified, namely;

1. Interest from Secured loans