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TMI Blog1997 (8) TMI 500X X X X Extracts X X X X X X X X Extracts X X X X ..... other L.P.As., the petitioners approached this Court on the basis of show cause notice issued as to why the assessment be not revised. Similarly, writ petitioners in the aforesaid writ petitions have straightaway come to this Court to challenge the order of the Assessing Authority whereby the Assessing Authority has assessed the inter-State sale of washed cotton seed oil at the rate of 4 per cent instead of 1 per cent, i.e., no remedy by way of appeal or revision has been availed of by the petitioners. These writ petitions were admitted and ordered to be heard along with L.P.A. No. 75 of 1992. 2.. M/s. Milkhi Ram Oil Dall Mills-writ petitioners-sought a writ of certiorari, mandamus or any other suitable writ or direction quashing annexures P-4 and P-5, same being against the provisions of law and without jurisdiction. It is the case of the petitioner that he filed quarterly returns for the years 1981-82, 1982-83 and 1983-84 within time and deposited the tax thereof. Earlier, interState sales tax on the sale of cotton seed oil and other seed oil was 4 per cent but the State of Punjab vide notification dated January 11, 1979 reduced the same Reported in [1992] 84 STC 206 (P H) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... objection, respondents raised bar of an alternative remedy by referring to section 22(1) of the Act. Secondly, the point urged by the petitioner is, in fact, a pure question of fact, i.e., whether cotton seed oil is edible or non-edible. The respondents placed reliance upon the view taken by the Hyderabad High Court in case reported as Kishenlal Oil Mills [1955] 6 STC 650 and other judicial pronouncements. 4.. The writ petition was admitted and finally decided vide the impugned judgment. 5.. Challenging the judgment of the learned single Judge, learned AdvocateGeneral, Punjab, argued that the court has misconstrued the point of law. In fact, writ court cannot go into the question of fact as to whether cotton seed oil is an edible oil or not? The counsel further argued that admittedly there exists an alternative remedy under section 22(1) of the Act and thus extraordinary remedy under article 226 of the Constitution of India could not be availed by the petitioner. The learned single Judge erred in examining the matter afresh on the point of fact which, in fact, has attained finality in view of the affirmation of the order of Assistant Excise and Taxation Commissioner by the T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w for an opinion of High Court was a mere formality. Precisely for this reason, the petitioner decided to assail the orders, annexures P-4 and P-5, by approaching the court under article 226 of the Constitution of India. According to the counsel, as the precise dispute between the parties pertains to determining as to whether washed cotton seed oil is edible or not and that was indeed a core question, learned single Judge rightly chose to examine this question thread-bare and after making reference to the relevant provisions under the other Acts, notifications, etc., found substance in the plea of the petitioner that washed cotton seed oil will fall within the ambit of edible oil and thus accepted this petition. Examination by learned single Judge is purely based upon provisions contained in the Prevention of Food Adulteration Act, 1954; standard prescribed under the Agricultural Produce (Grading and Marking) Act, 1937; report of the National Chemical Laboratory and specifications prescribed by the Indian Standards Institution and so has evaluated the respective contentions raised by the parties. Thus, no enquiry on facts has been made by the learned single Judge. So the judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods of new units set up in backward areas. The court held the classification to be discriminatory. The court further held that withdrawal of such exemption only in relation to new units set up for manufacture of edible oils is not discriminatory. This precise point whether washed cotton seed oil is edible oil was not an issue and so the decision of the apex Court is distinguishable on facts. 9.. Defending the action of some of the respondents who straightaway came to this Court challenging the show cause notices issued by the authorities, the counsel argued that the department had finally made up its mind, as noticed by the court in the case of M/s. Milkhi Ram Oil Dall Mills, approaching them was in the nature of a formality and, in fact, no useful purpose would have been served except to prolong their agony. This Court in such like cases has interfered under writ jurisdiction and in suitable cases have even quashed the notices and subsequent proceedings. Reliance has been placed upon the decision in Jindal Strips Limited case [1996] 100 STC 457 (P H). 10.. Lastly, the counsel argued that the finding of the Assistant Excise and Taxation Commissioner of awarding of interest, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent and so called upon the assessee to deposit the tax and the interest which has accrued thereupon. However, no penalty was levied. Aggrieved by the order of the Assistant Excise and Taxation Commissioner, separate applications were filed in respect of each assessment. The Tribunal, however, took up the matter together. During the course of hearing, it was put to the assessee as to whether even now they can adduce any proof to prove that the oil sold by them was an edible oil. At this their counsel sought time to place on record the analysis report from his buyers, namely, D.C.M. Limited and others. However, later on the counsel reported that as per information given by the buyers who stated that they are not in a position to give laboratory analysis of the oil sold by the dealer, the same cannot now be furnished. All the same, the Tribunal chose to examine in the light of available material on record and held that there is no evidence on record to infer that washed cotton seed oil is edible. The Tribunal consequently dismissed the applications. 12.. The Punjab General Sales Tax Act, 1948, deals with the ambit of taxation authority, constitution of Tribunal, levy of taxes, asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to enable it to determine the question raised thereby, it may refer the case back to the Tribunal to make such additions thereto or alterations therein as the court may direct in that behalf. (5) The High Court upon the hearing of any such case shall decide the question of law raised thereby, and shall deliver its judgment thereon containing the grounds on which such decision is founded and shall send to the Tribunal, a copy of such judgment under the seal of the court and the signature of the Registrar, and the Tribunal shall dispose of the case accordingly. (6) Where a reference is made to the High Court under this section, the cost (including the disposal of the fee) shall be the discretion of the court. (7) The payment of the amount, if any, of the tax due in accordance with the order of the Tribunal in respect of which an application has been made under sub-section (1), shall not be stayed pending the disposal of such application or any reference made in consequence thereof, but if such amount is reduced as the result of such reference, the excess tax paid shall be refunded in accordance with the provisions of section 12. 13.. As noticed above, the respondent-petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r reduce the assessment so that justice is done between the State and the assessee. Of course, if the order is proposed to be passed which is likely to affect the assessee adversely, he must be given an opportunity to show cause against the proposed enhancement. 15.. Thus, while examining the propriety of an order, the authority can go into the factual aspects of the matter as well. Somehow, the assessee did not join these proceedings and so an ex parte order was passed. It is not the case of the respondents that the order passed by the authorities under section 21 of the Act lacks inherent jurisdiction. Even the Tribunal has not found any error either of jurisdiction or of propriety and so affirmed the same. Whether decision of these authorities on facts could be a matter of fresh enquiry by this Court, in fact, goes to the root of the matter. This Court while exercising the powers under article 226 of the Constitution does not exercise any appellate powers. This is an exceptional remedy which is intended to redress blatant illegality or usurpation of power by an authority thereby infringing certain fundamental rights of the individuals or in some cases even his other legal righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n for obtaining redress in the manner provided by a statute, the High Court normally will not permit by entertaining a petition under article 226 of the Constitution the machinery created under the statute to be by-passed, and will leave the party applying to it to seek resort to the machinery so set up. 16.. The facts of the aforesaid case are somewhat similar to the one under scrutiny. Here too, though there was no provision under the Assam Sales Tax Act, permitting an aggrieved person to approach the Board of Revenue to refer to the High Court any question of law arising out of an order and in case the Board declines to state the case, the dealer of his own can apply to the High Court calling upon the Board or Tribunal to state the case and in case the High Court thinks that the decision of the Commissioner is not correct, High Court can hear such a case and decide the question of law raised on a reference and deliver its judgment thereof. The apex Court thus held that there being a hierarchy of taxing Tribunals competent to decide question as to the liability of the tax-payer under the Assam Sales Tax Act, with a right to have questions of law arising out of the order decide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On refining with alkali, bleaching with bleaching earths generally followed by deodorisation, colouring matters are removed and a light coloured oil is obtained. Most of this colour is due to a pigment called gossypol; on alkali treatment, the pigment is carried away leaving a light coloured oil. Refined cotton seed oil, provided it is of the quality usually expected of an ordinary refined vegetable oil like groundnut, sesame, till, etc., is completely harmless and edible. This has been proved in the laboratory by test on rats; while especially in America, where the major oil is refined cotton seed oil, it has been eaten without ill-effects for over 30 years. It is also being consumed after refining in various parts of India. It can be used as food material as such or after hydrogenation to vanaspati. Refined cotton seed oil of good quality is hence an edible oil just like any other edible vegetable oil. The report taken as a whole would show that cotton-seed oil at any rate for the present has not become edible in the hands of the dealer. 18.. May be one can differ with the view taken by the authority under the Sales Tax Act but such an order cannot be said to be wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the units producing and selling non-edible oils and the units manufacturing and selling washed cotton seed oil , soyabean raw oil (grade I) and unrefined sunflower cake oil would not come within the category of units manufacturing edible oils. It is in this light that some of the petitioners who were engaged in producing washed cotton seed oil contended that washed cotton seed oil will also fall within the category of edible oil and that there are several technical authorities who gave their opinion to that effect and so these units are entitled to tax exemptions. These contentions were not accepted by the State Government and so the petitioners approached the Supreme Court. It is in this light that the apex Court held as under: In so far as the second contention is concerned, viz., that washed cotton seed oil would also fall in the category of edible oils in spite of the fact that it has to be processed still further for being made fit for human consumption, we find that the contention is not a tenable one. The petitioners had contended before the Government that washed cotton seed oil is also one type of edible oil but the Government have rejected this contention stati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so that the charge does not fail. In the present case if we construe the words on the basis of return occurring in sub-section (2) of section 7 of the Act as on the basis of a true and proper return which ought to have been filed under sub-section (1) of section 7 then all the three classes of persons, viz., (i) those who have not filed any return at all and who are later on found to be liable to be assessed, (ii) those who have filed a true return but have not deposited the full amount of tax which they are liable to pay, and (iii) those who have filed a return making a wrong claim that either the whole or any part of the turnover is not taxable and who are subsequently found to have made a wrong claim, would be placed in the same position and they would all be liable to pay interest on the amount of tax which they are liable to pay but have not paid as required by sub-section (2) of section 7 of the Act. We are of the opinion that this view is in conformity with the legislative intention in enacting section 11B of the Act. This provision in the Rajasthan Sales Tax Act is in pari materia with the provisions contained in the Punjab General Sales Tax Act. On this ground, we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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