9911796707
TMI Blog2002 (4) TMI 925X X X X Extracts X X X X X X X X Extracts X X X X ..... emption certificate dated September 12, 1997 granted by the Assistant Commissioner of Commercial Taxes, Madhubani, in terms of S.O. No. 478 dated December 22, 1995 till December 20, 2006, i.e., for the validity period of the said certificate, by way of tax-free purchase of the raw materials, namely, coal from the BCCL with which the respondent has been granted the linkage. The case of the respondent is that acting pursuant to the Bihar Industrial Policy of 1995 it set up an industrial unit in 1997 for manufacturing special smokeless fuel (domestic coke), coaltar and small size coal in accordance with the technology developed by the Central Mine Planning and Design Institute (CMPDI) after obtaining registration from the Industries Department, vide, Certificate No. 032302875 dated February 17, 1997 and sales tax registration from the Commercial Taxes Department, vide, Registration No. M/B 978(R) dated July 8, 1997. The Industrial Policy of 1995 declared by the State of Bihar provides for various incentives to the new industrial units, one of the incentives being in the shape of sales tax exemption on purchase of raw materials as well as finished goods, vide, para 16 of the Policy R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arkhand State either adopts or modifies any law by repeal or amendment, the law which is applicable in the State of Bihar will continue to apply in the territories which are at present under the Jharkhand State for a period of two years from the appointed day during which the Jharkhand State may either adopt or modify the existing law of the State of Bihar but until that is done, the notifications, orders, etc., issued by the State of Bihar will hold the field. Inasmuch as the notification dated December 22, 1995 under which the respondent had been allowed exemption by the State of Bihar prior to the appointed day has not been either repealed or amended, the effect of the notification will continue to be available to the respondent and it would be entitled to purchase, tax-free, raw materials, i.e., coal as before, till the Legislature or any competent authority of the Jharkhand State makes any amendment in this regard. The Government of Jharkhand through the Commissioner of Commercial Taxes and the Joint Commissioner of Commercial Taxes (Administration), Dhanbad, have come up in appeal against the said order. 5.. Shri P.K. Shahi, learned counsel for the appellants, submitted tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ided by the Legislature or other competent authority of that State. And therefore not only S.O. No. 478 dated December 22, 1995 but also the exemption certificate dated September 12, 1997 issued thereunder remains valid and indeed binding on the authorities of the Government of Jharkhand, and the respondent is thus entitled to taxfree purchase of coal from BCCL. In support of the contention counsel placed reliance on a decision of the apex Court in State of Punjab v. Balbir Singh AIR 1977 SC 629. Counsel also referred to article 252 of the Constitution and submitted that the Bihar Re-organisation Act being a law made by the Parliament with the consent of the State, the laws made by the erstwhile State of Bihar have to be treated as adopted by the successor State of Jharkhand, by fiction. It cannot take a different stand except in accordance with sections 84 and 85 of the Re-organisation Act by repudiating or otherwise modifying or changing such law by the Legislature or other competent authority. 7.. After hearing counsel for the parties I am of the view that the submissions advanced on behalf of the respondent are wellfounded and they must be accepted. The issue in hand is in fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssor State. In this regard the Supreme Court pointed out the distinction between coming into existence of a new State as result of accession, conquest, merger or integration on the one hand and by re-adjustment of territories on the other. After noticing the observations made by the Punjab High Court on the interpretation of section 88 of the Act, the Supreme Court stated the law at pages 635-36 of the report as under: "If this could be the position in the continuance of the law in the successor States, on what principles one can say that the administrative order made by the erstwhile State of Punjab automatically lapsed and came to an end on and from the appointed day on the coming into existence of the successor States. Is it possible to take the view that the Legislature when it made so many provisions in the Act in its various parts in regard to the matters already referred to, did not think it appropriate to make a provision for the continuance of the effect of the administrative orders passed by the Government of the erstwhile State of Punjab until the Governments of the successor States modified or changed it? Or is it, as a matter of law and propriety, reasonable to think ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... successor State. 11.. So far as the Industrial Policy, 2001 of the Government of Jharkhand is concerned reference to it by the appellants is wholly misplaced. The said Policy Resolution envisages giving certain tax benefits, among other things, to the new industrial units set up after November 15, 2000. It obviously refers to the industrial units situate in the State of Jharkhand and has nothing to do with the units situate outside the State. It has been referred to, perhaps, to point out that the Government of Jharkhand having declared an Industrial Policy of its own, the Industrial Policy of the erstwhile State of Bihar of 1995 came to an end and therefore, any tax benefit available to units thereunder also came to an end. If this is what the appellants intend to convey, it must be rejected out of hand, for, the Industrial Policy of the Jharkhand State relates to industrial units situate in that State. Whether the industrial units situate outside the State are entitled to any such benefit has to be considered with reference to the statutory orders made under the Bihar Finance Act because notwithstanding the terms of the policy, unless corresponding provisions are made by issuin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... modification much less repudiation or supersession of S.O. No. 478 dated December 22, 1995 which will therefore continue to be applicable in the State of Jharkhand and binding on the authorities of the Government of that State. 13.. The argument with reference to the provisions of the Central Sales Tax Act is also wholly misconceived. The inter-State sale or purchase of goods falling under sections 3, 4 and 5 of the Central Sales Tax Act, stand excluded by virtue of the provisions of sub-clause (1) of section 7 already referred to above. While any sale or purchase of goods taking place in the course of inter-State trade or commerce can be taxed only under the Central Act, sale or purchase taking place outside the State can be taxed only by that State where the sale or purchase takes place, the third category of sale or purchase, i.e., in course of import of goods into or export of goods outside the territory of India cannot be taxed either under the Central Sales Tax Act or under the State Act. It is to be kept in mind that any question as to whether any sale of goods attracts the provision of Central Sales Tax Act has to be considered by the assessing officer in course of assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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