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TMI Blog2007 (8) TMI 680X X X X Extracts X X X X X X X X Extracts X X X X ..... e matter the assessee cannot press into service the provisions of section 8(2A) of the Act for grant of reduced rate of tax under the CST Act. Therefore, we are of opinion that assessing authority as well as the Tribunal was fully justified in rejecting the claim of the assessee. In that view of the matter, the sales tax revision petitions require to be rejected and accordingly, it is rejected. The questions of law framed are answered against the assessee. - - - - - Dated:- 2-8-2007 - DATTU H.L. C.J. AND HARUN-UL-RASHID , JJ. ORDER:- The order of the court was made by H.L. DATTU C.J. Since common questions of law and fact are involved in these revision petitions, they are clubbed together, heard and disposed of by this common order. In these revision petitions, the petitioner calls in question the legality or otherwise of the order passed by the Kerala Sales Tax Appellate Tribunal in T.A. Nos. 476 to 481 of 1997 dated February 11, 2003. By the impugned order, the Tribunal has rejected the claim of the petitioner for levying reduced rate of tax on inter-State sales as provided under section 8(2A) of the Act. The facts in a nutshell are as follows: The pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the honourable Supreme Court in the case of State of Rajasthan v. Sarvotam Vegetables Products [1996] 101 STC 547. The honourable Supreme Court in the above case held that 'even for sale of goods, the rate of tax for which is governed by a notification under section 8(5) granting exemption or prescribing a lower rate, there is obligation to produce the C form'. After the pronouncement of the above judgment, the Government of Kerala issued a clarification regarding the above judgment of No. 27193/B1/TD dated February 14, 1997, which reads as follows: 'I am to invite a reference to the letter cited and to inform you that the challenge in writ appeal in State of Rajasthan v. Sarvotam Vegetables Products [1996] 101 STC 547 (SC); [1996] 4 KTR (SC) in regard to the notification issued under sub-section (5) of section 8 of the Rajasthan Sales Tax Act, 1954 is that the only conditions which a dealer seeking to avail of the above benefit of the notification are to satisfy are those mentioned in the notification and no other. In other words, the condition mentioned in sub-section (4) of section 8 cannot be insisted upon as a condition for obtaining the benefit under the notif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lating any restriction or condition and that the reduction is not for any specified period and that the reduction is general in nature and not under any specified condition or restriction. Therefore the reduction in the rate of tax is sought to be treated as a general reduction in respect of the sale of finished rubber goods produced from factories in Kerala. According to the Revenue, G.O. (Ms) No. 124/88/ID/August 31, 1988 was not issued under section 8(5) of the CST Act and so the reduced rate of 3.75 per cent was not applicable in the case of inter-State sale. We find force in the arguments advanced by the Revenue. If the rate of tax on a particular goods in the State is generally lower than four per cent, the rate of tax applicable to inter-State sale in such cases shall be calculated at the lower rate [section 8(2A)]. In the instant case, the general rate applicable to rubber product was 10 per cent plus 25 per cent additional sales tax (entry 200 of the First Schedule). Since the reduction of rate as per G.O. (M. S.) No. 124/88/ID/ dated August 31, 1988 is not a general reduction within the meaning of section 8(2A) lower rate as specified in the G.O. is not applicable. The Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roller flour mills within the State for a period of five years with effect from the date of publication of the notification. The court, taking into consideration the view expressed by the apex court in the case of Commissioner of Sales Tax, Jammu and Kashmir v. Pine Chemicals Ltd. [1995] 96 STC 355, had opined that the notification issued by the State Government is in the nature of a general exemption and therefore the assessee therein is entitled for exemption from payment of tax under the provisions of the CST Act. At this stage itself, we would like to state that the decision so rendered by the Andhra Pradesh High Court is without reference to the law declared by the apex court in the case of State of Uttar Pradesh v. Hindustan Safety Glass Works (P.) Ltd. [1996] 101 STC 529. In that view of the matter, we respectfully disagree with the view expressed by the Andhra Pradesh High Court in the aforesaid decision. To answer the submissions made by the learned counsel appearing for the assessee, in our view, the notification/order issued by the State Government in G.O. (M.S.) No. 124/88/ID/dated August 31, 1988 requires to be extracted. The said order is as under: GOVERNMEN ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notification/orders issued by the State Government is in the nature of a general exemption or a notification attached with a specific condition. What is a general notification and what is a notification under specified circumstances is explained by the apex court in the case of Commissioner of Sales Tax, Jammu and Kashmir v. Pine Chemicals Ltd. [1995] 96 STC 355. In the said decision the court has made the following observations (at page 355): Exemption from Central sales tax under section 8(2A) of the Central Sales Tax Act, 1956, of the sale or purchase of goods is available only where the sale or purchase of such goods is exempt 'generally' under the State sales tax law. The court must give due regard and attach due meaning to the expression 'generally' in section 8(2A) which expression has been defined in the Explanation thereto. Section 8(2A) requires specifically that such exemption must be a general exemption and not an exemption operative in specified circumstances or under specified conditions. General exemption means that the goods are totally exempt from tax. Where the exemption from taxation is conferred by conditions or in certain circumstances the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. For the purposes of this sub-section, a sale or purchase of any goods shall not be deemed to be exempt from tax generally under the sales tax law of the appropriate State, if under that law the sale or purchase of such goods is exempt only in specified circumstances or under specified conditions or the tax is levied on the sale or purchase of such goods at specified stages or otherwise than with reference to the turnover of the goods. Even the aforesaid provision came up for consideration before the apex court in various decisions. The consistent view of the court is that, if the notification issued by the State Government grants general exemption under the State Act, then the dealer under the Act will be entitled for exemption by virtue of section 8(2A) of the CST Act read with the Explanation. Referring to the case law on this aspect of the matter, in our opinion, may not be necessary. In the instant case, as we have already noticed that the order passed by the State Government granting certain exemption is only on finished rubber goods produced/manufactured in factories in Kerala and it is only those industries which will be entitled for reduced rate of tax, in suc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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