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TMI Blog1984 (12) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... sing authority for the assessment years 1978 and and 1979 issued prescribed notice under section 54 of the Act of 1954 asking the, petitioner to show cause inter alia why the sale of the steel pipes effected by the petitioner to the registered dealers for resale against prescribed sales tax declaration form No. S.T. 17 amounting to Rs. 41,89,693.33 be not assessed to tax at the rate of 4 per cent and why the interest thereon be not levied in view of the decision reported in Associated Cement Co. Ltd. v. Commercial Tax Officer, Kota [1981] 48 STC 466 (SC). The petitioner filed reply and submitted that the tax on the sale of steel tubes is to be levied on the last point in series of sales to successive dealers and that the tax on declared goods can be levied only at one point as contemplated under section 15(a) of the Act of 1956. The assessing authority levied tax in respect of sale on steel tubes amounting to Rs. 41,89,693.33 sold by the petitioner against declaration form No. S.T. 17 and created a tax liability at 4 per cent amounting to Rs. 1,27,587.75 and further created liability of interest under section 11B of the Act of 1954 amounting to Rs. 1,22,496.00 and served a demand n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facturers and they sold goods to the subsequent dealers and yet have been assessed and demand made. While the writ petitions filed by Vijai Hari Agencies who are the purchasers of Bharat Steel Tubes have been taxed at a subsequent point and hence the question as mentioned above is common to all the six writ petitions whether on the same goods, i.e., steel tubes, sales tax could be imposed on Bharat Steel and Jotindra Steel & Tubes or on the subsequent purchasers Vijai Hari Agencies and other traders in case of Jotindra Steel & Tubes Ltd. The petitioners' contentions are that the entire dispute arose in all these cases for the assessment years 1977-78 and 1978-79 only till then there was no dispute and the earlier assessing authority completed the assessment of the petitioners for the years 1973-74, 1974-75, 1975-76 anp 1976-77 on the sale of steel tubes and pipes as taxable at the last point of sale in State of Rajasthan and accepting the claim of the petitioner in respect of sales made to the registered dealers against declaration form No. S.T. 17 without charging any sales tax thereon and thus the petitioners' assessment for the years 1977-78 and 1978-79 ought to have been consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are directly produced by the rolling mill; (c) steel scrap, steel ingots, steel billets, steel bars and rods; (d) (i) steel plates; } (ii) steel sheets } sold in the same form in which (iii) sheet bars and tin bars } they are directly produced by (iv) rolled steel sections } the rolling mill." (v) tool alloy steel } It is submitted that in the aforesaid notification it is clearly mentioned that the tax shall be payable at the last point in the series of sales by successive dealers. Thereafter notifications were issued revising the rates on May 29, 1967, March 8, 1969, March 31, 1973 and July 1, 1975 however without altering the position of 1958 notification and again when the notification was issued on February 27, 1980 it clearly mentioned that the tax is leviable at the last point. It was, therefore, contended that on a perusal of the aforesaid notifications it is abundantly clear that the notification dated April 11, 1958 where the tax was payable on iron and steel at the last point continued and no change was ever made and this is why the assessing authorities used to levy tax at the last point in the assessment years 1973-74, 1974-75, 1975-76 and 1976-77 and again and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Thus, there being availability of alternative remedy, the writ petition should be dismissed. Reliance in this connection has been placed on Titaghur Paper Mills Co. Ltd. v. State of Orissa [1983] 53 STC 315 (SC); AIR 1983 SC 603 and Premier Automobiles Ltd. v. Kamlakar Shantaram Wadke AIR 1975 SC 2238. Replying to the contentions raised on behalf of the petitioner, learned counsel for the respondents submitted that the notification referred to by the petitioners were not applicable to the facts of these writ petitions as the notification dated April 11, 1958 was a composite notification issued under section 5 of the Rajasthan Sales Tax Act relating to tax as well as under rule 15 of the Rajasthan Sales Tax Rules relating to the point of tax. It was contended that the items mentioned in this notification did not cover the steel tubes imported by the petitioner as the list was exhaustive. As such, by virtue of rule 15 the tax on steel tubes/pipes was leviable at the first point. Regarding the subsequent notifications dated May 29, 1967, March 8, 1969 and July 1, 1975 it is submitted that they were issued under section 5 of the Rajasthan Sales Tax Act relating to the rate of tax only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leviable at the last point. In the alternative, it is contended that in case the notification is not relied upon, then there is no notification fixing the stage and in the absence of notification the levy is per se illegal. Regarding the preliminary objections raised on behalf of the respondents Mr. Mehta submitted that the assessment order can be directly challenged by the writ petition and there is absolutely no illegality about it. Reliance has been placed on Bhawani Cotton Mills Ltd. v. State of Punjab [1967] 20 STC 290 (SC), A.V. Fernandez v. State of Kerala [1957] 8 STC 561 (SC), Calcutta Discount Co. Ltd. v. Income-tax Officer AIR 1961 SC 372, Rohtas Industries Ltd. v. Rohtas Industries Staff Union AIR 1976 SC 425, Karam Chand Thapper and Bros. (Coal Sales) Ltd., Jaipur v. Sales Tax Officer, City Circle A, Jaipur [1965] 16 STC 412 at 413; AIR 1963 Raj 51, Kailash Nath v. State of U.P. [1957] 8 STC 358 (SC); AIR 1957 SC 790, Rajasthan Spinning & Weaving Mills Ltd. v. State of Rajasthan [1980] 46 STC 141; 1980 RLW 180; and K.S. Shivji Co. v. Joint Commercial Tax Officer [1965] 16 STC 769; AIR 1967 Mad 135. Before I proceed to decide these writ petitions on other points, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s complained of. The petitioners have the right to prefer an appeal before the prescribed authority under sub-section (1) of section 23 of the Act. If the petitioners are dissatisfied with the decision in the appeal, they can prefer a further appeal to the Tribunal under sub-section (3) of section 23 of the Act, and then ask for a case to be stated upon a question of law for the opinion of the High Court under section 24 of the Act. The Act provides for a complete machinery to challenge an order of assessment, and the impugned orders of assessment can only be challenged by the mode prescribed by the Act and not by a petition under article 226 of the Constitution. It is now well-recognised that where a right or liability is created by a statute which gives a special remedy for enforcing it, the remedy provided by that statute only must be availed of. This rule was stated with great clarity by Willes, J., in Wolverhampton New Water Works Co. v. Hawkesford (1859) 6 CB (NS) 336 at page 356 in the following passage: 'There are three classes of cases in which a liability may be established founded upon statute.....But there is a third class, viz., where a liability not existing at commo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to say whether he is entitled to exemption or not, under sub-clause (vi) of section 5(2)(a) of the Act. If a person is not liable for payment of tax at all, at any time, the collection of a tax from him, with a possible contingency of refund at a later stage, will not make the original levy valid; because, if particular sales or purchases are exempted from taxation altogether, they can never be taken into account, at any stage, for the purpose of calculating or arriving at the taxable turnover and for levying tax". In A.V. Fernandez v. State of Kerala [1957] 8 STC 561 (SC) it has been held as under: "If there is a liability to tax, imposed under the terms of the taxing statute, then follow the provisions in regard to the assessment of such liability. If there is no liability to tax there cannot be any assessment either. Sales or purchases in respect of which there is no liability to tax imposed by the statute cannot at all be included in the calculation of turnover for the purpose of assessment and the exact sum which the dealer is liable to pay must be ascertained without any reference whatever to the same. There is a broad distinction between the provisions contained in the st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt have also chosen to file the appeals, ought to have taken one firm decision whether they want to continue with the appeals or the writ petitions filed here. In Titaghur Paper Mills [1983] 53 STC 315 (SC); AIR 1983 SC 603, cited above, their Lordships of the Supreme Court have categorically held that "where a right or liability is created by the statute which gives special remedy for enforcing it, the remedy provided by that statute alone must be availed of ". Then in Premier Automobiles Ltd. v. Kamlakar Shantaram Wadke AIR 1975 SC 2238 their Lordships while dealing a case under the Industrial Disputes Act held as under: "It would thus be seen that through the intervention of the appropriate government, of course not directly, a very extensive machinery has been provided for settlement and adjudication of industrial disputes. But since an individual aggrieved cannot approach the Tribunal or the labour court directly for the redress of his grievance without the intervention of the Government, it is legitimate to take the view that the remedy provided under the Act is not such as to completely oust the jurisdiction of the Civil Court for trial of industrial disputes. If the disput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of appeals are more effective, I would direct the appellate authority to decide the appeals before February 28, 1985. The petitioners' apprehension is that the appellate authority may not decide the appeals at an early date and/or the same may be dismissed on some technical ground or on the point of limitation. In my considered opinion this apprehension of the petitioners is wholly misconceived. In the present case the assessing authority has given two contradictory orders in the same subject-matter and it is the bounden duty of the appellate authority to adjudicate upon the points involved so that it may also be a guideline in future for the assessing authorities. This is more so when this Court is not deciding the case, on a preliminary objection raised on behalf of the Department. It is now a settled proposition of law that the State must not non-suit the citizens on the technical pleas like that of limitation and others and should obtain the decision on merits. In view of the fact that the assessing authority has apparently erred in giving contradictory orders, the demand raised on all cannot ex facie be permitted to stand. One of the two orders is likely to be set aside a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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