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TMI Blog1996 (7) TMI 559X X X X Extracts X X X X X X X X Extracts X X X X ..... to grant exemption in the rate of tax to such new units which have undertaken expansion. Under this Notification exemption from sales tax upto a monetary limit of 125% of the fixed capital investment is stipulated. 5. Petitioners claim benefit under the said Notification of trade tax on their turnover in excess of the base production. If this is reached before the months of January, February and March, 1994 for the assessment year 1993-94, they would be entitled for these months. If their be any excess balance of this stock carried to the next year, they would be entitled for exemption on this, if sold in the month of April, May, 1994 and so on. But the Department in view of the said Commissioner's Circular in giving wrong interpretation of the said Notification thus frustrating the very object it seeks to achieve. 6. Learned Counsel for the petitioners Sri Bharatji Agarwal strongly repelled the preliminary objection of the respondents viz. the present writ petition is only against show cause notice. For this reference is made to the aforesaid Circular of the Commissioner dated 27-2-93 which is Annexure-5 to the writ petition. The argument is since the assessing authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in clause (a) shall be entitled to the facility of exemption from or reduction in the rate of tax. 7. Learned Additional Advocate General raised preliminary objection, since the present writ petition is directed for quashing notices for provisional assessment for the various months for the assessment year 1994-95 and since there is already final assessment orders passed, the relief sought has become infructuous. So far the second relief for interpreting Commissioner's Circular merely indicates guidance but it has no binding effect on the assessing authority and in no case on the appellate authorities as they are quasi-judicial authorities performing Statutory duties. 8. Learned Counsel for the petitioner strongly relied in the case of M/s. Hindustan Aluminium Corporation Ltd. v. State of Uttar Pradesh and others, 1977 UPTC 81, relevant portion of which is quoted below : Para-4 : It is not disputed that the Commissioner of Sales Tax has already issued a circular to all Sales Tax Officers and the Assistant Appellate Commissioner on the interpretation to be put on the notification dated 30th May, 1975 and informing them that only aluminium ingots should be treated as un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cerned, they represent merely their understanding of the statutory provisions. They are not binding upon the Courts. It is true that those clarifications and circulars were communicated to the concerned dealers but even so nothing prevents that State from recovering the tax, if in truth such tax was leviable according to law. There can be no estoppel against the statute. The understanding of the Government, whether in favour or against the assessee, is nothing more than its understanding and opinion. It is doubtful whether such clarifications and circulars bind the quasi-judicial functioning of the authorities under the Act, while acting in quasi-judicial capacity, they are bound by law and not by any administrative instructions, opinions, clarifications or circulars. Law is what is declared by this Court and the High Court to wit it is for this Court and the High Court to declare what does a particular provision of statute, say, and not for the executive. Order issued by Andhra Pradesh Government under Section 42 (2) of the A. P. Act namely viz. G. O. Ms. No. 383 dated 17-4-1985 is undoubtedly of a statutorily character but, the power under Section 42 cannot be utilised for alteri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M. C. Coated Fabrics Pvt. Ltd, Notda, Ghazlabad v. State of U.P. and others, 1992 UPTO 89, the relevant portion of which is as under : Para-6, Learned Counsel for the petitioners, however, relying on a Division Bench decision of this Court in the case of Hindustan Aluminium Ltd. v State of U. P., 1977 DPTC 81, and the case of Fllterco v. State of U. P., 1977 UPTC 470 : 1980 (2) SCC 103 has urged that in view of the circular dated 5-3-1977 issued by the Sales Tax Commissioner, copy of which has been filed as Annexure-IV to the writ petition, laying down that P. V. C. rexin is not entitled to exemption from tax under the aforesaid Notification of 1958, it is futile to file an appeal Para-7 : That apart, in view of the proviso to sub-section (7) of Section 9 of the Act the Sales Tax Commissioner has been prohibited from issuing any orders, instructions or directions to the Appellate Authorities so as to interfere with their discretion in the exercise of their appellate function. Circular of the Sales Tax Commissioner is not as such binding on the Appellate Authorities. Appellate Authorities is to decide the appeal in accordance with law without being guided by the circular of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sue direction of such a nature. Further holds, Appellate Authorities being under direct control on the administrative side, such an officer cannot decide it dispassionately. While recording this, aforesaid provisions of Act and Rules were not brought to the notice of the learned Judge. 15. Sub-section (7) of Section 9 no doubt makes the appellate authority under the control of the Commissioner but its proviso makes it abundantly clear, this exercise of control will not be an impediment on such appellate authority in the exercise of its appellate functions notwithstanding any order, instructions or directions issued under it. Sub-rule (2) of Rule 4 authorises Commissioner to issue such instructions. Sub-rule (3) of Rule 4 supplements what proviso to Section 9 (7) enacts, under it Commissioner is vested with ill the powers exercisable by the subordinate authorities but excludes powers of the appellate authorities. Thus there is no escape but conclude any instruction (circulars) issued by the Commissioner, notwithstanding its binding effect on the administrative side, cannot prevail or have binding effect on the appellate authorities while exercising quasi-judicial functions. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... impugned circular will not come in the way of such authorities in deciding the case of the petitioners. If the said circular (instructions) are issued for the procedural guidance to the assessing authority and if being within the Act and Rules, of course, the assessing authority will follow it and give full weightage. But finding in any way contrary to the Act and Rules, quasi-judicial functions are not taken away through these instructions. 19. Commissioner is vested with various powers and functions under the Act and Rules. It has reyisional power under Section 10-B to call for any order of the subordinate officer and pass such order as he thinks fit under Section 35 for determination of any disputed question within its limit and such decisions are binding on the applicant, assessing and the appellate authorities, under Rule 4 (2) to issue instructions (circulars) for regulating the procedure for carrying out provisions of the Act or the Rules. Sub-rule (4) and (5) refer to the general control of the Commissioner. To test the extent, jurisdiction and effect of his order one has to see under what cover he is exercising the powers. While exercising powers under Section 35 by vir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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