2008 (12) TMI 696 - HC - VAT and Sales Tax

Amending notification dated July 23, 1999, whereby converted timber has been included within the meaning of timber challenged - Held that - Timber and timber trees , as per dictionary meaning as also the interpretation of these words by various judgments, including those of the Supreme Court, are those trees or the wood of those trees which are used as material for construction of houses or for manufacture of items of furniture. Trees, the wood of which is not used for the aforesaid two purposes, are not timber trees nor is the wood of such trees timber. The Government, which granted concession vide notification dated February 7, 1992, on its own could not (sic) recall that notification or amend the same with a view to narrowing down or expanding its scope.Therefore, it cannot be said that the amending notification dated July 23, 1999 is ultra vires. Appeal dismissed.

Summary

Issues:
Challenge to the amending notification dated July 23, 1999 under the Himachal Pradesh General Sales Tax Act as ultra vires the Constitution of India.

Analysis:
The judgment by the High Court of Himachal Pradesh involved four Civil Writ Petitions challenging the amending notification dated July 23, 1999, under the Himachal Pradesh General Sales Tax Act. The petitioners, who were agents of farmers selling converted khair trees for manufacturing katha, enjoyed a concession in tax rates. The State Government amended the notification, including converted timber in the definition of "timber," thereby removing the concession on converted timber. The petitioners did not appeal the assessment orders and directly filed writ petitions. The respondents argued that the writ petitions were not maintainable due to the availability of the appeal remedy. The court considered the definition of "timber" under the Act and the Indian Forest Act, concluding that converted timber was not excluded from the definition. The court rejected the argument that the amending notification was ultra vires, emphasizing the State's power to grant concessions to promote industry. The judgment highlighted that the concession excluded standing timber trees but not converted timber. The court also discussed the interpretation of "timber and timber trees" as material for construction or furniture manufacture.

The court further analyzed the definition of "timber" under various laws and previous judgments, determining that khair trees might not qualify as timber trees. The judgment referenced a Division Bench judgment to support this interpretation. The court emphasized that the Government could not unilaterally amend the notification to restrict or expand its scope once granted. Therefore, the court held that the amending notification was not ultra vires. The court dismissed the writ petitions but allowed the petitioners to appeal the assessment orders. The judgment advised the petitioners to appeal to the appellate authorities under the Himachal Pradesh General Sales Tax Act, with the period spent on the writ petitions excluded from the limitation calculation.

In conclusion, the High Court of Himachal Pradesh upheld the validity of the amending notification dated July 23, 1999, under the Himachal Pradesh General Sales Tax Act, rejecting the petitioners' challenge as ultra vires. The court emphasized the State's power to grant concessions and clarified the definition of "timber" under the relevant laws. The judgment provided guidance for the petitioners to pursue appeals against the assessment orders while dismissing the writ petitions.