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TMI Blog1998 (8) TMI 575X X X X Extracts X X X X X X X X Extracts X X X X ..... in timber. 2.. In all the three writ petitions question is raised regarding the validity of the gazette notification fixing the rate of cess at three per centum on the sale price of forest produce timber. Also come under challenge the demands of cess made against the petitioners on "cut and finished timber" purchased by them on the basis of the impugned notification. 3.. The petitioners in all the three writ petitions claim that they purchase only cut and finished timber from the depots of the Forest Department/Bihar Forest State Trading who sell them in lots on the basis of auction. It is stated that the trees in the forest are cut by the Forest Department/Bihar Forest State Trading. From the forest timber in cut and finished form was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eration. Learned counsel submitted that the earlier decisions in the cases of Someshwar Prasad 1974 PLJR 357 (Pat) and Western India Match Company Limited (1981) PLJR 4 on which reliance was placed dealt with imposition of cess on cutting of tress and standing timber. Those decisions, therefore, could have no application for justifying the imposition of cess on cut and finished timber. She further submitted that the Supreme Court decision in the State of Orissa v. Titaghur Paper Mills Co. Ltd. [1985] 60 STC 213; AIR 1985 SC 1293 had laid to rest any doubt that cut timber would not qualify as immovable property. She submitted that though the Supreme Court decision was noticed by the division Bench in Bajrangbali Saw Mill (1993) 2 PLJR 512 (P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l come into force with effect from 1st September, 1991." 9.. As quoted above, the notification uses the expression "forest produce timber" and, therefore, there is no reason to suggest that the imposition of cess is on cut pieces of timber. In other words, the imposition of cess is on trees and standing timber and the taxing event takes place when trees and standing timber are fell down. There is, however, nothing in the law to restrain the licensee/ the person cutting the tree to pass on the liability of cess to the purchaser of the cut timber and this is exactly how it works out in the cases in hand. It is to be noted that after the sale of the lot of cut timber on the basis of auction the purchaser is given the sale note which gives th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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