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TMI Blog2009 (7) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... n the basis of the findings rendered above. The liability for payment of interest also need be re-worked accordingly. The revised assessment may be issued as early as possible, at any rate within a period of two months from the date of copy of this judgment. - W.P. (C). No. 1982 of 2006 - - - Dated:- 9-7-2009 - ABDUL REHIM C.K. , J. C.K. ABDUL REHIM J. The petitioner is the proprietrix of a small-scale industrial unit engaged in manufacture of rubber bands. The unit is recognized and financed by the Kerala Khadi and Village Industries Board. The petitioner is a registered dealer under the provisions of the Kerala General Sales Tax Act, 1963 and the Central Sales Tax Act, 1956. The assessment in dispute pertains to the year 2002-03. The petitioner is challenging validity of exhibit P6 Notification S.R.O. No. 958 of 2002, dated November 21, 2002 and exhibit P7 revised assessment of CST for the year 2002-03. The petitioner's unit was exempted from payment of tax on inter-State sale as per S.R.O. No. 1731 of 1993. As per serial No. 3 in Schedule IV of the abovesaid notification khadi and village industrial units recognized by the Kerala Khadi and Village Industries B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perseded. As per serial No. 3 in Schedule III of exhibit P6, the concessional rate of tax for products of the units recognised by the Khadi and Village Industries Board was re-fixed at two per cent and production of C/D forms was insisted as a condition for availing of the concession. Exhibit P6 notification is dated February 21, 2002. It was published in the official gazette only on November 28, 2002. But in exhibit P6 it is stated that the notification shall be deemed to have come into force with effect from June 1, 2002. The challenge against exhibit P6 notification is on the ground that the withdrawal of exemption is opposed to principles of promissory estoppel. It is clear that exemptions/concessions are issued exercising the power conferred under section 8(5) of the CST Act depending on the policy decision of the Government from time to time. It is well-settled through various legal precedents that no challenge on the ground of promissory estoppel is sustainable against concessions granted based on policy decisions of the Government. Hence I am inclined to hold that Notification S.R.O. No. 958 of 2002 (exhibit P6) is valid and sustainable. The next question to be consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nced is that, even when the petitioner was enjoying full exemption by virtue of S.R.O. No. 1731 of 1993, there was obligation to produce declarations. In support of this argument a decision of the honourable Supreme Court in State of Rajasthan v. Sarvotam Vegetables Products [1996] 101 STC 547 (SC); [1996] 8 SCC 639 is pointed out by the Government Pleader. In the said case while considering a notification issued by the State of Rajasthan under section 8(5) of the CST Act, the honourable Supreme Court observed: (at page 554 of STC) . . . The conditions prescribed by the notifications are the conditions prescribed for availing the further reduction of rate provided by the notification. The notifications merely reduce the rate of tax; they do not do away with the levy altogether. All that the notifications have done is to reduce the rate of tax from 4 per cent to 1 per cent (2 per cent, as the case may be). Separate conditions are prescribed for availing the rate (which itself is a concessional rate) prescribed in section 8(1) and for availing the further reduction provided by the notification. Those two sets of conditions are prescribed by section 8(4) and by the notifications ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, the following proviso shall be added at the end, namely: 'Provided that in respect of the goods specified in column (2) of Schedule I against serial numbers 1, 2, 3, 4, 6, 8, 11 and 13 in column (1) thereof, the notification shall be deemed to have come into force on the 21st November, 2002.' Explanatory note. (This does not form part of the notification, but is intended to indicate its general purport.) Consequent to the amendment to Central Sales Tax Act, 1956, Central sales tax had to be levied in arecanut, ginger, pepper, rubber, caprolactam, coconut oil, coconut oil cake and copra from June 1, 2002. As the notification in this regard was issued only on November 21, 2002, the dealer could not collect Central sales tax from June 1, 2002 and if demand for tax for the intervening period is enforced it will have adverse impact on the agricultural sector. In the budget for the year 2003-04, Government have, therefore, announced to exempt registered dealers from the liability to pay Central sales tax for the period from June 1, 2002 to November 20, 2002 in respect of the inter-State sales turnover of the above goods. This notification is intended to achieve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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