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TMI Blog2006 (9) TMI 517X X X X Extracts X X X X X X X X Extracts X X X X ..... ry tax on the lay flat tubings and PP bags so imported by the petitioner against the issue of C declaration form. According to the first respondent, the lay flat tubings would fall under serial No. 24 of the Schedule to the Tamil Nadu Tax on Entry of Goods into Local Areas Act, 2001. A reply dated November 23, 2005 was filed by the petitioner contending, inter alia, that there could be no levy of entry tax on the import of lay flat tubings and the PP bags for the reason that they were essentially products of polypropylene. The first respondent by his order dated April 28, 2006 confirmed tax and penalty demand on the petitioner holding that lay flat tubings and PP bags were falling under serial No. 24 of the Schedule to the Tamil Nadu Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Commercial Tax Officer [1993] 90 STC 47 (SC) and a judgment of the division Bench of this court in Pizzeria Fast Foods Restaurant (Madras) Pvt. Ltd. v. Commissioner of Commercial Taxes [2005] 140 STC 97. The short question that falls for our consideration is whether entry tax is leviable on the purchase turnover of the two products purchased by the company under section 3 of the Tamil Nadu General Sales Tax Act, 1959 in spite of the clarification dated April 25, 2003 issued by the Special Commissioner and Commissioner of Commercial Taxes under section 28-A of the Tamil Nadu General Sales Tax Act, 1959 read with section 10 of the Tamil Nadu Tax on Entry of Goods into Local Areas Act, 2001? Entry No. 24 was introduced by amendment of Sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by proof of payment of such fee, paid in such manner, as may be prescribed. (2) The Commissioner of Commercial Taxes may, if he considers it necessary or expedient so to do, for the purpose of uniformity in the work of assessment and collection of tax, clarify any point concerning the rate of tax under this Act or the procedure relating to assessment and collection of tax as provided for under this Act. (3) All persons working under the control of Commissioner of Commercial Taxes shall observe and follow the clarification issued under sub-section (1) and sub-section (2). The Supreme Court in State Bank of Travancore v. Commissioner of Income-tax [1986] 158 ITR 102 held that even though the clarifications issued by the Revenue be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hallenging the correctness of the said circulars even on the ground of the same being inconsistent with the statutory provision. The ratio of the judgment of this court further precludes the right of the department to file an appeal against the correctness of the binding nature of the circulars. Therefore, it is clear that so far as the department is concerned, whatever action it has to take, the same will have to be consistent with the circular which is in force at the relevant point of time. In Collector of Central Excise, Vadodra v. Dhiren Chemical Industries [2002] 126 STC 122, the Supreme Court observed as follows: 11. We need to make it clear that, regardless of the interpretation that we have placed on the said phrase, if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Corporation v. Commercial Tax Officer [1993] 90 STC 47 (SC), and submitted that the clarification cannot be contrary to the statute and there cannot be estoppel against the statute. We have gone through the decision in Bengal Iron Corporation case [1993] 90 STC 47 (SC). In that case the apex court was concerned with section 42 of the Andhra Pradesh General Sales Tax Act which confers power on the State Government to remove difficulties. Sub-section (1) confers the said power to meet the problems arising from transition from the previous Sales Tax Act to the present Sales Tax Act. An order under sub-section (1) is required to be published in the Andhra Pradesh Gazette. Sub-section (2) is general in nature. In the context of the direction ..... X X X X Extracts X X X X X X X X Extracts X X X X
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