9911796707
TMI Blog1990 (4) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... he Government of West Bengal. The goods manufactured by the company have been notified under the West Bengal Sales Tax Act, 1954 (hereinafter referred to as "the 1954 Act"). The company is duly registered as a dealer under the 1954 Act and also under the Central Sales Tax Act, 1956. A notification being Notification No. 1177-F.T. dated March 31, 1983, provided that no tax shall be payable by a dealer under the Act on sales by a newly set up small-scale industry of notified commodities other than those included in Schedule X manufactured by it during the period of three years if the industry is situated within the area of the Calcutta Metropolitan District or for five years if it is situated elsewhere in West Bengal from the date of its first sale of such manufactured notified commodity. A dealer claiming the benefit of the notification was required to obtain a certificate of eligibility. The first sale of the applicant was made on March 8, 1984. The applicant No. I applied to respondent No. 3 for issuance of the eligibility certificate pursuant to which respondent No. 3 issued a certificate of eligibility dated December 21, 1984, certifying that the company was eligible to claim ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any reply to the letters addressed by them to the respondents. While making the assessment for the period up to December 31, 1984, the respondent, Commercial Tax Officer, by his order dated April 15, 1988, held that the company was entitled to the exemption under the said notification but purported to levy purchase tax on purchases made by them from unregistered dealers. For the period up to December 31, 1984, no amount by way of turnover tax was levied or demanded by the respondents. In September, 1988, the applicants filed revised returns for the period from January 1985 to February 1987 before respondent No. I claiming therein that they were not liable to pay any purchase tax during the period of the said exemption. The order dated April 15, 1988, passed by the respondent, Commercial Tax Officer, purporting to levy purchase tax and turnover tax in respect of the period from March 8, 1984 to March 7, 1987, was illegal, invalid and without jurisdiction. 2.. On the aforesaid grounds and interpretation of the different sections of the Act to which we shall advert to in greater details later on, the applicants prayed for an injunction restraining the respondents from making any ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndustrial unit having obtained eligibility certificate for exemption of payment of tax during the impugned period is yet liable to pay turnover tax and purchase tax in view of the provisions of sections 4, 4AA and 4AAA of the 1954 Act read with Notification No. 1177-F.T. dated March 31, 1983. 6.. In order to appreciate the rival contentions of the parties it may be convenient to bear in mind the provisions of sections 4, 4AA and 4AAA and the Notification No. 1177-F.T. dated March 31, 1983, which is the basic foundation of the applicant's claim. The relevant portions of the aforesaid provisions are reproduced below: "4. Liability to payment of tax.-(I) There shall be paid by every dealer a tax on his turnover, at such rate (not exceeding twenty per cent) as the State Government may, by notification in the Official Gazette, fix in this behalf, and different rates may be fixed for different classes of notified commodities. 4AA. Exemption from payment of tax.-Notwithstanding anything contained in section 4 or section 23A the State Government may, if it is satisfied that it is necessary so to do in the public interest, by notification in the Official Gazette and subject to such co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of which his aggregate of the gross turnover under this Act and the gross turnover under the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941) does not exceed rupees fifty lakhs and on the expiry of such three years after the commencement of clause (a) of sub-section (3) of section 4 of the West Bengal Taxation Laws (Amendment) Act, 1987, his liability to pay the turnover tax shall cease unless he becomes again liable to pay the turnover tax under clause (a) or clause. (b); (d) every dealer whose liability to pay the turnover tax has ceased under the provisions of clause (c) or clause (cc) shall, if the aggregate of his gross turnover under this Act and the gross turnover under the Bengal Finance (Sales Tax) Act, 1941, during any year again exceeds rupees twenty-five lakhs, be liable to pay from the first day of the year immediately following such year the turnover tax at the rate specified in sub-section (3) of such part of his turnover as specified in sub-section (2). (2) The turnover tax shall be levied on that part of the gross turnover of a dealer during any period which remains after deducting therefrom his turnover during that period on- (a) sales of goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of such sales: Provided further that the dealer claiming the benefit of this notification shall be so eligible, if he possesses a valid certificate of eligibility in the form appended to this notification granted by the appropriate Assistant Commissioner in this behalf for such period as mentioned in the said certificate: Provided also that in the case of a dealer claiming the benefit of this notification on account of sales of manufactured notified commodity or commodities which had been goods liable to taxation under the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941) but were subsequently specified by notification under section 25 of the West Bengal Sales Tax Act, 1954, the period of such benefit of three years or five years, as the case may be, as referred to in this notification, shall be reduced by the period during which the dealer was entitled to similar benefit of exemption of tax on the sales of such goods under clause (66a) of rule 3 of the Bengal Sales Tax Rules, 1941. Explanation.-For the purpose of this notification 'newly set up small-scale industry' shall mean a new industrial unit,- (i) with an investment up to rupees thirty-five lak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Gupta, appearing on behalf of the applicant, while submitting that the applicant is entitled to exemption from the liability of turnover tax and purchase tax during the period of validity of the eligibility certificate, prefaced his submission upon a reference to the observations of Rowlatt, J., in Cape Brandy Syndicate v. Commissioners of Inland Revenue [1921] 1 KB 64 quoted in AIR 1971 SC 378 (Baidyanath Ayurved Bhawan (Pvt.) Ltd. v. Excise Commissioner). Rowlatt, J., said in that case that in taxing statute one has to look at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used. This is a rule of construction which has been repeatedly quoted with approval by the Supreme Court. If the person sought to be taxed comes within the letter of the law, he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand, if the Revenue seeking to recover the tax cannot bring the subject within the letter of the law, the subject is free, however, apparently within the spirit of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 4AA of the 1954 Act. It provides that no tax shall be payable by a dealer under the 1954 Act on sales by a newly set up small-scale industry of notified commodity other than those included in Schedule X appended to the notification, manufactured by it during the period of eligibility. Upon a reference to the various provisions stated above, it was argued that there is nothing in the notification to indicate that the reference to tax in the notification means only the tax contemplated by section 4 or 4AA. It was further contended that the notification does not in terms exclude turnover tax which was introduced long before the notification was issued. If turnover tax was intended to be excluded, it was argued, then the notification should have been worded otherwise and more succinctly. It is true that the notification does not in clear terms say that turnover tax shall not be payable but, it was argued, that the expression "tax" should include in its coverage turnover tax under section 4AAA of the Act as well. 10.. We are, however, unable to agree with the contention urged by Mr. Gupta in this regard. The notification with the aid of which exemption is claimed is a notific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om his turnover during that period on such sales as may be prescribed. In the face of that provision it was further argued that no turnover tax was payable in view of the fact that in terms of the said notification the whole of the turnover in respect of the sales of the notified commodity is liable to be deducted from the gross turnover and if such deduction is made nothing would remain for the purpose of computation of the turnover tax. Mr. Gupta who also argued the case before the High Court in that matter, submitted that if it was the intention of the authority concerned that the exemption granted by the notification would not cover the payment of turnover tax, then suitable provisions would have been made in this regard. The learned Judge accepted the contention of Mr. Gupta and found that the petitioner was not liable for turnover tax so long as the eligibility certificate was in operation. It is clear upon a reading of the judgment that the decision rested upon the interpretation of the Notification No. 1177-F.T. dated March 31, 1983. We do not feel persuaded to accept the construction put forth by Mr. Gupta. It is already indicated that the notification was issued in exerci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the binding nature they are clearly in the nature of contemporanea expositio, furnishing legitimate aid in the construction of statutory provisions. In the instant case, the decision referred to does not come to the aid of the applicant for reasons that we shall presently discuss. Section 4AAA was enacted notwithstanding anything contained elsewhere in the Act. Therefore, section 4AAA would be operative and enforceable despite section 4AA. Necessarily, it follows that section 4AAA would be operative in spite of section 4AA or any notification issued thereunder. The notification issued under section 4AA is limited in its application. The authority to issue the notification is derived from section 4AA. Therefore, the notification cannot be read for the purpose of interpreting section 4AAA nor can the notification limit or restrict the operation of section 4AAA. 13.. Mr. Majumdar, the learned State Representative, besides contending that the applicant is not entitled to total exemption from turnover tax in view of the notification, made an alternative submission that, in any event, there would be no question of exemption from payment of tax on purchases. In arguing so, he pointe ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
