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TMI Blog2013 (4) TMI 732X X X X Extracts X X X X X X X X Extracts X X X X ..... e order dated 31.07.2008 passed by Additional Commissioner (respondent-2) under Section 21(2) of U.P. Trade Tax Act, 1948 (hereinafter referred to as the 'Act') for the Assessment Years 2002-03 and 2003-04 and the consequential notice dated 25.8.2008 issued by Deputy Commissioner (respondent-3) starting re-assessment proceedings. 3. It has been stated that the petitioner was a society, registered with U.P. Khadi Gram Udyog Board, Lucknow and engaged in business approved by Khadi Gram Udyog Board. It is registered also under the provisions of U.P. Trade Tax Act as well as Central Sales Tax Act. State of U.P., in exercise of powers under Section-4(b) of the Act, issued Notification No. 7037 dated 31.01.1985 granting exemption from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paddy as such no exemption is granted on the sale of rice under the aforesaid Government Order. 4. Thereafter, respondent-2 issued notices dated 24.06.2008 under Section 21(2) of the Act for the Assessment Years 2002-03 and 2003-04, mentioning therein that as per Notification No. 2792 dated 30.09.2004, the rice manufactured out of paddy from the unit of the petitioner was not liable for exemption from the trade tax, as such, the exemption granted to the petitioner amounted to escaped assessment. The petitioner filed his reply to the aforesaid notices. However, Additional Commissioner (respondent-2) by order dated 31.07.2008 has held that under Government Orders dated 31.01.1985 and 30.09.2004, exemption from trade tax liability has not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lready been decided by a Division Bench of this Court in W.P. No. 575 of 2003 (M/s. Him Gramodyog Sansthan vs. Additional Commissioner and Others) decided on 19.12.2006, wherein this Court has held that units of Khadi Gram Udyog Board were entitled for exemption of trade tax on the sale of rice under the Government Order dated 31.01.1985 and Government Order dated 27.02.1997. Accordingly, the exemption from trade tax liability on the sale of rice claimed on the basis of Government Order dated 27.02.1997, was rightly given. 7. Learned Special Counsel for the State of U.P. however submitted that the Apex Court in Ganesh Trading Company Vs. State of Haryana, AIR 1974 SC 1362, and in Satnam Overseace (Exports) Vs. State of Haryana, (2003) 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luded from clause-38 of Entry-3. An exclusion clause can not be treated as a clarificatory clause, or clarification of existing clause. The exclusion of specific goods clearly proves that the excluded goods were included in this clause prior to that date of exclusion. The notification dated 30.09.2004, which carries exclusion of some goods will apply prospectively and not with retrospective effect. The reassessment under Section 21 (2) on the basis of notification dated 30.09.2004, which was not applicable for the Assessment Years 2002-03 and 2003-04, was illegal. 9. In the result, the writ petition succeeds and is allowed. The order dated 31.07.2008 passed by Additional Commissioner (respondent-2) under Section 21(2) of U.P. Trade Tax A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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