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TMI Blog2001 (3) TMI 1007X X X X Extracts X X X X X X X X Extracts X X X X ..... Industries, 1998 (for short, "the Exemption Scheme") vide Gazette Notification dated April 7, 1998, in exercise of the powers conferred by section 15 of the Rajasthan Sales Tax Act, 1994 (for short, "the RST Act") read with section 8(5) of the Central Sales Tax Act, 1956 (for short, "the CST Act"), providing for exemption to industrial units from payment of tax on the intra-State/inter-State sales of goods manufactured by them within the State in the manner, to the extent and for the period, specified therein. 3.. The salient features of the scheme have been that the exemption scheme shall be operative from April 1, 1998 to March 31, 2003. It shall confer benefits to industrial units which commence commercial production during the said operative period. Para 2(a) of the scheme defines "banned area", as the areas under the urban agglomeration limits of cities, as notified by the competent authority. Explanation thereto provides that sick units, located anywhere in the State, shall be eligible for the benefits under the scheme. Para 2(h) defines "ineligible industries " as industries included in annexure A to the said notification and the same shall not be eligible for the benefits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibility and extent of exemption from tax in a tapering manner for a period of eleven years. Para 3 of annexure B provides for types of units eligible for exemption and includes all categories of cement units including pioneering, prestigious, very prestigious and premier units except the mini cement plants which have been made ineligible vide annexure A. Clause (a) of para 4 of annexure B provides that a sick unit which had not availed benefits of exemption from tax or deferment of tax previously, would be entitled for the same benefits for eleven years which are available to new units at Serial No. 1. Clause (b) thereof provides that other sick units which have availed of the benefits of exemption from the tax or deferment of tax can avail the benefit for eleven years but in a tapering manner as it shall start in the first year with 80 per cent and shall be only 10 per cent for the 8th, 9th, 10th and 11th years. 6.. In the instant case, the petitioner-company-a sick industrial unit within the meaning of para 2(q)(1)(i) of the scheme asserts that sick units have been classified as a separate class or category of the units for the purpose of the scheme and, thus, entitled for exemp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver revenues are required for development of the State and the Government takes a decision to modify such a scheme, the industrial units cannot have any grievance against it. Clause (g) of para 5 does not provide for benefits of the scheme only for those units which fulfil the conditions incorporated in either of the sub-clauses thereof and it shall be applicable only in a case where an industry, though included in annexure A on any date during the period of operation of the scheme and further fulfils either of the terms in either of the three clauses, e.g., in clause (1) the industries of which the applications for grant of benefits are pending before any Committee on the said date, i.e., the date on which the industry stood included in annexure A and it does not apply to the units which stood included in annexure A on the date of promulgation of the scheme as clauses (g) and (i) of para 1 of the scheme makes it clear that it has taken into consideration the earlier incentive or deferment schemes of 1987 and 1989. Clause (4) thereof provides that the "benefits" if sanctioned, shall be restricted to the extent of benefits which would be available to such unit in the incentive or de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have before us a complete and precise scheme for regulating the issue of permits, providing what matters are to be taken into consideration as relevant, and prescribing appeals and revisions from subordinate bodies to higher authorities. The remedies for the redress of grievances or the correction of errors are found in the statute itself and it is to these remedies that resort must generally be had." 11.. Similar view has been reiterated in Assistant Collector of Central Excise v. Dunlop India Ltd. [1985] 154 ITR 172 (SC); AIR 1985 SC 330, Ramendra Kishore Biswas v. State of Tripura (1999) 1 SCC 472 and Sivgonda Anna Patil v. State of Maharashtra (1999) 3 SCC 5. 12.. In C.A. Abraham v. Income-tax Officer [1961] 41 ITR 425 (SC); AIR 1961 SC 609 and H.B. Gandhi v. Gopinath & Sons (1992) Suppl. 2 SCC 312, the honourable apex Court held that where hierarchy of appeals is provided by the statute, party must exhaust the statutory remedies before resorting to writ jurisdiction. 13.. A Constitution Bench of the honourable Supreme Court, in K.S. Venkataraman and Co. (P.) Ltd. v. State of Madras [1966] 17 STC 418 (SC); AIR 1966 SC 1089, considered the Privy Council judgment in Raleigh In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e time. 18.. In J.S. Rawat v. National Air Port Authority 1991 (1) RLR 210, Mangi Lal v. R.S.R.T.C. 1991 (2) RLR 466 and Ramcharan Das v. State of Rajasthan 1986 RLR 680, this Court held that no person can be permitted to choose two forums for the same relief as it amounts to abuse of process of the court. 19.. In SBCWP No. 651 of 2000, B.S.L. Ltd. v. State of Rajasthan decided on August 25, 2000, this Court relegated the parties to the appropriate forum observing that parties should approach the writ court only after exhausting the statutory remedies. 20.. A division Bench of this Court in DBCSA No. 1760 of 2000, Jodhpur Chartered Accountants Society v. State of Rajasthan, decided on February 19, 2000, dismissed the petition only on the ground of not exhausting the statutory remedies by the petitioner. 21.. In the instant case, the validity of the notification itself is under challenge and relief of quashing the same is sought. Undoubtedly, such a relief cannot be granted by the assessing authority or the appellate authority. The writ petition cannot be dismissed at this stage only on the ground that statutory remedies have not been exhausted or matter has been seized by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ust be preferred, has always been recognised. In Dena Bank v. Bhikabhai Prabhudas Parekh & Co. [2000] 120 STC 610; 2000 (5) JT 307, the honourable Supreme Court held that the sovereign dues have to be given preference over other charges for the reason that it requires money for the development of the State and such a principle is founded on the rule of necessity and public policy for the reason that it is essential that as a sovereign, the State should be able to discharge its primary Governmental functions and in order to discharge such functions efficiently, it must be in possession of necessary funds and, therefore, it must be given priority in respect of its tax dues over other kind of dues. Similar view has been reiterated by the honourable apex Court in Builders Supply Corporation v. Union of India [1965] 56 ITR 91; AIR 1965 SC 1061, Collector of Aurangabad v. Central Bank of India [1968] 21 STC 10; AIR 1967 SC 1831, Dattatraya Shanker Mote v. Anand Chintaman Datar [1975] 2 SCR 224, RIICO v. State of Rajasthan AIR 1995 SC 269; State Bank of Bikaner and Jaipur v. National Iron & Steel Rolling Corporation [1995] 96 STC 612; (1995) 2 SCC 19 and State of Bihar v. Bihar Chamber of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a sick unit attained finality. Thus, questions arise as to whether the corrigendum provides for a correction of the earlier notification or it amounts to its amendment and in case it falls in latter category, it is to be determined as what rights stood accrued in favour of the petitioner as State/Revenue Department has not gone into appeal, revision or review thereof under paragraphs 8 and 9 of the scheme and whether same have been taken away. 28.. In Commissioner, Sales Tax v. Dunlop India Limited [1994] 92 STC 571, the Allahabad High Court had to deal with the issue of corrigendum and held that corrigendum, when issued to correct a notification, would relate back to the date of issue of the original notification. 29.. In Piara Singh v. State of Punjab (2000) 5 SCC 765, the honourable apex Court considered the scope and application of a corrigendum and held as under: "In any case, in the present case it cannot be said that there is clerical or arithmetical error in mentioning khasra number or its area in the sale certificate.......... Considering the long lapse of time and the fact that there is no question of a clerical or arithmetical error, the authorities ought not to have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be withdrawn with retrospective effect." 32.. Similarly, in Citadel Fine Pharmaceuticals v. State of Tamil Nadu [2000] 119 STC 315, the Tamil Nadu Taxation Special Tribunal considered a case in which by issuing an errata, certain exemptions were withdrawn. The Tribunal held as under: "The learned counsel for the petitioner would contend that, errata is meant that correction of the typographical mistakes, but it cannot have the effect of law to take away the vested rights of a citizen and therefore except for the purpose of correcting the typographical errors like spelling mistakes, it cannot have the effect of nullifying the concession given under the original notification.............. In view of these reasons, we hold that the two errata to the notifications, are illegal in so far as they affect the vested right of the petitioner................" 33.. In view of the above, it cannot be held that the impugned corrigendum has been issued to correct any typographical error or omission therein. It tantamounts to amendment of the scheme. Thus, the question requires consideration is whether the said amendment has taken away the vested rights of the petitioner. 34.. In Health G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule of construction is more firmly established than this that retrospective operation is not to be given to a statute so as to impair an existing right or obligation other than as regards the matter of procedure, unless that effect cannot be avoided without doing violence to the language of the enactment. If the enactment is expressed in a language which is fairly capable of either interpretation, it ought to be construed as prospective only. But where, as here, it is expressly stated that an enactment shall be retrospective, the courts will give it such an operation. It is obviously competent for the Legislature, in its wisdom, to make the provisions of an Act of Parliament retrospective. That is precisely the case here. In Quinn v. Prairiedale (1958) 25 WWR 241, where a subsequent enactment provided that the relevant section should be deemed never to have been contained in the earlier statute, it was held to be sufficient to rebut the presumption against retrospectivity........ In State of Punjab v. Mohar Singh [1955] 1 SCR 893; AIR 1955 SC 84 and in Indira Sohan Lal v. Custodian of Evacuee Property [1955] 2 SCR 117; AIR 1956 SC 77, this Court had to consider the effect of repeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied in the notification. This power could be exercised prospectively or retrospectively. The exercise of the power for granting exemption could be with certain conditions but those conditions must be mentioned in the notification granting the exemption. If the notification is issued granting the exemption and any person acts upon it, subsequent issue of a notification with retrospective effect putting conditions on the grant of exemption may result in denial of the exemption and thus the effect would be levy of tax on the transaction. This is not contemplated by the power conferred under section 4(2) of the Act. Under section 4(2) of the Act, therefore, the State Government can issue the notification granting the exemption retrospectively with any condition it likes but the said section does not contemplate withdrawal of the exemption retrospectively by putting any condition." 39.. In Arvind Industries v. State of Gujarat [1995] 99 STC 333; (1995) 6 SCC 53, the honourable apex Court considered the application of doctrine of promissory estoppel in respect of the incentive scheme and held that the incentive scheme does not contain any promise that the benefits given to the new indu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 125 STC 290; (1999) 3 SCC 264, the honourable Supreme Court considered the case where the exemption granted in tax had been withdrawn with retrospective effect. The court held that the State Government was free to alter the incentive scheme but that would only be with prospective effect. The court further observed as under: "Promissory estoppel has to be pleaded and established............. It is only if these factual particulars are pleaded that the other side has an opportunity to answer the same. The withdrawal of exemption shall be effective from the date it is withdrawn and not with retrospective effect." 44.. In Shree Chemical & Minerals v. State of Rajasthan (2000) 1 RLW 378, this Court, placing reliance upon a large number of judgments of the Supreme Court, interpreted the provisions of sub-clause (g) of clause (5) of the scheme which provided that the benefits of the scheme shall be available from the date of application filed by the applicant-unit complete in all respects. 45.. In V.V.S. Sugars v. Government of Andhra Pradesh [1999] 114 STC 47; AIR 1999 SC 2124, the honourable Supreme Court observed that while interpreting the tax statute, the literal and strict cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arly expressed by her that as sick units had been given benefit of exemption of tax on tapering basis and the same had to be given by dint of issue of completion certificate and the unit did not charge the sales tax from the buyers, operation of the corrigendum would aggravate the problem of the sick units, therefore, she asked the Secretary, Finance Department that corrigendum issued on September 30, 1999 may be made effective from the date of its issuance. The Director of Industries was a Member-Secretary of the SLSC. Her view must be given due importance and in view of this, it has been suggested that at least this Court must give due consideration to the administrative interpretation, i.e., the doctrine of contemporanea expositio. 51.. It is well-settled principle of interpretation of statute that it should be read with reference to the exposition it has received from contemporary authority. However, the said rule has exception and such a rule must give way where the language of the statute is plain and unambiguous or the rule being interpreted is not very old or the understanding of department itself runs counter to the law or it is found to be de hors the rules. [Vide Senior ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dy been conferred benefits. It was within the competence of the State Government to alter/modify the same as required in public interest. Petitioner is held entitled for the relief as per the original scheme up to the date of amendment and subsequent thereto as provided in the corrigendum. 55.. Much has been argued regarding the application of a notification, i.e., whether it would apply from the date of its issuance or from the date of its publication in the gazette or from the date it becomes available to the public at large. 56.. In Pankaj Jain Agencies v. Union of India (1994) 5 SCC 198, a Bench of two honourable Judges of the Supreme Court held that the notification for exemption of duty, etc., shall become operative from the date of publication in the official gazette and the failure to make the law known would not acquire the element of operativeness and enforceability. 57.. In State of Maharashtra v. Mayer Hans George AIR 1965 SC 722, the three-Judge Bench of the honourable Supreme Court held that the law in India becomes operative and effective in its territory from the date of publication and made known in India by publication in the gazette. 58.. In Collector of Cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... corrigendum issued in this case does not provide for any correction of a typographical mistake or any omission in the original scheme, therefore, it amounts to amendment of the incentive scheme. The language used in the notification does not suggest that it would apply with retrospective effect, therefore, any alteration/modification of the original scheme would apply prospectively. Notification comes into effect only on the date of its publication in the official Gazette, therefore, petitioner shall be entitled to the relief as provided under the original scheme up to the date of publication of the notification in the Gazette, i.e., January 7, 2000 and subsequent thereto as per the amended scheme. 62.. With the above observations, the petition partly succeeds and is allowed to that extent only. The interim order passed earlier shall continue for a period up to 30th April, 2001. Presently, petitioner, if so advised, may file an appeal, if not already filed, within a period of four weeks and if the assessee does so, the appellate authority may entertain the appeal on merit without insisting on the issue of limitation. For a further period, petitioner may request the appellate autho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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