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TMI Blog2015 (3) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... ate of tax payable under the Act can be exercised either prospectively or retrospectively, the power of the Government to cancel or vary any Notification issued under Sub Section (3) of Section 10 is one that can be exercised only prospectively. The respondents cannot rely on SRO 946/07 for the purposes of denying the benefit of exemption in terms of SRO 316/05 to the petitioners for the period from 10.10.2001 to 31.03.2004. - that insofar as the exemption Notifications in question clearly indicate the understanding of the State Government that there is a process of manufacture involved in the conversion of field latex to centrifuged latex and crumb rubber, it cannot be the stand of the department that there is no manufacturing process involved in such a conversion. In that view of the matter, the 2nd objection raised by the departmental authority while denying the benefit of exemption to the petitioners, also does not have any legal basis. Petitioners, cannot be denied the benefit of the exemption envisaged under SRO 316/05 for the period from 10.10.2001 to 31.03.2004. The assessments completed against the petitioners taking a contrary view, as also the notices issued by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion is 2002-2003. The assessments were concluded in favour of the petitioner by Ext.P1 assessment order wherein the petitioner was given the benefit of SRO 316/05. Thereafter, Ext.P2 notice was issued to the petitioner by invoking the powers under Section 35 of the KGST Act for the purposes of reopening the assessments. The said notice is impugned by the petitioner in the said writ petition. 4. As already noted, the issue to be considered in all these three writ petitions is the availability of exemption to a manufacturer of centrifuged latex and crumb rubber, from the payment of tax payable under the KGST Act on the purchase turnover of rubber in any form used for the manufacture of centrifuged latex and crumb rubber. The contention taken by the respondent authorities is that in view of decisions of the Supreme Court and of this Court which had expressed the view that field latex, centrifuged latex and crumb rubber were essentially the same commercial commodity, it could not be said that there was any manufacturing process involved in the conversion of field latex into centrifuged latex and crumb rubber. The benefit of the Notification granting exemption was therefore sought to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government Pleader appearing on behalf of the respondents. 7. On a consideration of the facts and circumstances of the case and the submissions made across the Bar, I am of the view that the present writ petitions must necessarily succeed. The exemption from payment of tax payable under the KGST Act on purchase turnover of rubber used for the manufacture of centrifuged latex and crumb rubber was covered by Notification SRO 695/03 for the period from 01.04.1988 to 09.10.2001. Thereafter, the same exemption continued for the period from 10.10.2001 to 31.03.2004 through SRO 316/05. The benefit of exemption granted by the latter Notification was sought to be taken away through the introduction of a third Notification, namely SRO 946/07. The contention that is put forwarded by counsel for the petitioners is that SRO 946/07 could not have legally taken away the exemption that was already granted vide SRO 316/05 for the period from 10.10.2001 to 31.03.2004. Reliance is placed on the express provisions of Section 10 of the KGST Act as it stood during the relevant period which reads as follows: 10. Power of Government to grant exemption and reduction in rate of tax:- (1) The Governme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it of exemption in terms of SRO 316/05 to the petitioners for the period from 10.10.2001 to 31.03.2004. 9. I must now turn to the next contention on behalf of the respondents namely that the process of conversion of field latex to centrifuged latex and crumb rubber, is one that does not involve a process of manufacture for the purposes of the Notification granting exemption. This again is no longer an issue that is res integra. A learned Single Judge of this Court, in the judgment dated 17.06.2009 in W.P.(C).Nos.21251 21286 of 2008, had occasion to consider the very same contention in the context of the Notification SRO 695/03 which was the exemption Notification in force for the period from 01.04.1988 to 09.10.2001. Dealing with a contention similar to that taken by the respondents in the instant case, it was found as follows in paragraph 13 of the said judgment: 13. What is stated, as already noted, is that the Apex Court has held that there is no manufacture. What is essentially involved is the interpretation of the Notification SRO 695/2003. The facts are not in dispute. The petitioners purchased field latex. They make centrifuged latex out of the field latex and eithe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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