Order

This appeal is against the judgment of the Karnataka High Court dated 20.7.1999 in Writ Appeal No. 2498 of 1999 in Writ Petition No. 7834 of 1994.

2. Briefly stated, the facts are as follows:

In the State of Karnataka, as per the Schedule to the Karnataka Sales Tax Act, 1957, sales tax on television sets and components was at 6%. On 20.6.1986, the State of Karnataka issued a notification under Section 8-A of the said Act by which dealers who sold television sets and components manufactured in the State of Karnataka were to pay sales tax at the reduced rate of 2% whereas dealers who sold televi­sion sets and components manufatured outside the State were to pay sales tax @ 4%. On 28.3.1987, the State issued another notification by which the rate of 2% was raised to 3% and 4% was raised to 6%.

3. Both these notifications were chal­lenged by one M/s Solidaire India Limited on the ground that they were discriminatory. On 8.10.1990, the Karnataka High Court struck down these two notifications. Thus, from that date onwards, the rate of tax was again as per the Schedule to the Act i.e. at the rate of 6%.

4. It seems that the State as well as some other dealers filed appeals before the Division Bench of the Karnataka High Court. No stay was granted by the Division Bench. Pending the appeals, in spite of the fact that the notifications stood quashed by the High Court, the State issued a notification on 30.3.1992 rescinding the notification dated 28.3.1987.

5. On 29.1.1994, an assessment order was passed directing the appel­lants to pay to the Government, tax @ 6% instead of 3% at which they were paying to the Government. In pursuance to the assessment order, a demand notice was issued on 23.2.1994. The appellant filed writ peti­tion in the Karnataka High Court challenging the assessment order and the demand notice. The writ petition came to be dismissed on 23.7.1998. The appeal filed by the notification has been dismissed by the impugned judgment dated 20.7.1999.

6. It must be mentioned that the appeals filed against the judgment of the High Court dated 8.10.1990 (quashing the two notifica­tions) were dismissed on 15/18.9.1995.

7. Reliance has been placed upon the authorities of this Court in the cases of British Physical Lab India Ltd. V. State of Karnataka [(1999) 1 SCC 170], Texmaco Ltd. V. State of A.P. [(2000) 1 SCC 763] and Shree Cement Ltd. V. State of Rajasthan [(2000) 1 SCC 765] and it was submitted that this Court has, in similar cir­cumstances, directed the respective Governments not to collect tax for the relevant period. It was submitted that as the State had filed an appeal and that appeal was pending, the appellant could not have collected tax @ 6%, as if the appeals were allowed, they would have become liable to penalty under Section 18-A for having collected tax contrary to the provisions of Section 18 of the Karnataka Sales Tax Act, 1957. It was also submitted that the appellant did not know about the judgment of the High Court dated 8.10.1990 as that judgment was reported only in 1994.

8. We see no substance in these submissions. Ignorance of law is no excuse. Once the notifications stood quashed, the dealers were bound to collect tax @ 6%. Even otherwise, it is difficult to believe that parties in the trade do not know the prevailing rate of tax.

9. The three authorities relied upon are of also no assistance. Those are cases where during the pendency of the relevant notifica­tions, the parties were prevented, by law, from collecting tax at a different rate. Subsequently those notifications were struck down. The question was whether the parties were liable to pay differential tax during the period when the notifications were in force. It was under those circum­stances that this Court held that during the period the notifications were in force, the parties could not have collected at a rate differ­ent from that specified in the notifications. As the parties were prevented by law from so collecting, this Court