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TMI Blog2000 (2) TMI 88X X X X Extracts X X X X X X X X Extracts X X X X ..... e year 1999-2000. The mode of grant and the authority to grant and renew such licences is mentioned in rule I of the rules, according to which L-14A licence is granted for retail vend of country spirit for human consumption of the premises by way of auction or negotiations. The petitioners were granted the licences in an open auction held for the purpose in which they were the highest bidders. The State charges on monthly basis a licence fee for the grant of this privilege of selling liquor by the wine contractors like the petitioners. This licence enables the licensee to purchase country liquor from the distilleries (manufacturers) or from the wholesalers who also hold L-13 licences for wholesale vend of country spirit. It is the common case of the parties that the petitioners before us had been purchasing country liquor from the wholesalers (L-13 licensees). Before the country liquor can be purchased, a permit is necessary to be obtained from the Excise and Taxation Department for a certain quantity after depositing the excise duty thereon in the Government treasury. Then, on the production of this permit, the wholesalers after charging the price sell and allow the release of liq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Excise and Taxation Commissioner, Chandigarh, issued notices to the petitioners dated October 27, 1999, requiring them to deposit 10 per cent. of the amount of licence fee deposited by them as income-tax in respect of their country liquor vends for the period April 1, 1999, to June 30, 1999. They were further directed to deposit 10 per cent. income-tax at source under- section 206C of the Act along with the monthly licence fee payable in future. It is against these notices that the present petition has been filed under article 226 of the Constitution. The relevant part of section 206C of the Act with which we are concerned in these cases is reproduced hereunder for facility of reference : "206C. (1) Every person, being a seller shall, at the time of debiting of the amount payable by the buyer to the account of the buyer or at the time of receipt of such amount from the said buyer in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, collect from the buyer of any goods of the nature specified in column (2) of the Table below, a sum equal to the percentage specified in the corresponding entry in column (3) of the said Table of such amount as in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such sale ; or (iii) a buyer where the goods are not obtained by him by way of auction and where the sale price of such goods to be sold by the buyer is fixed by or under any State Act ; (b) 'seller' means the Central Government, a State Government or any local authority or corporation or authority established by or under a Central, State or Provincial Act, or any company or firm or co-operative society." Alcoholic liquor for human consumption other than Indian made foreign liquor is one of the goods specified in the Table referred to in section 206C of the Act and, therefore, this provision would apply to such goods. A perusal of the aforesaid provisions makes it clear that every person who sells alcoholic liquor for human consumption other than Indian made foreign liquor is required at the time of debiting the amount pay able by the buyer to his account or at the time of receipt of such amount from the buyer in cash or by cheque or draft or by any other mode, to collect from the buyer a sum equal to 10 per cent. of the amount payable by the buyer as income-tax at source. The word "buyer" has been defined in the Explanation to mean a person who obtains in any sale, by way ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The language of clause (a) in the Explanation is clear and unambiguous and the exclusions referred to therein do exclude from the main provision, the subsequent purchasers of country liquor. It is not disputed by the Department that the petitioners on the basis of their L-14A licences purchased the country liquor from the wholesalers who are L-13 licensees. Now coming to the judgment of the Patna High Court in State of Bihar's case [1993] 202 ITR 535. It is true that the State of Bihar was held to be a seller of alcoholic liquor for human consumption within the meaning of sections 44AC and 206C of the Act as they then stood but, in our opinion, this judgment is of no help to the Department. The provisions of sections 44AC and 206C of the Act as they then stood were under consideration of the learned judges which provisions are materially different from section 206C of the Act which is under our consideration. Another Bench of the same High Court in Ramjee Prasad Sahu v. Union of India [1993] 202 ITR 800, considered the provisions of section 206C of the Act as were introduced by the Finance Act, 1992, with effect from April 1, 1992, and held that 15 per cent. of the excise duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he nature specified in column No. 2 of the Table and the requirement of sub-section (1) of section 206C is that 10 per cent. of the amount payable is to be collected by the seller from the buyer of the goods and not from the buyer of the right to receive the goods. Since no goods have been sold by the Excise and Taxation Commissioner, he cannot be described as a seller within the meaning of the Act. We may now examine the matter from another angle as well. Sub-section (1) of section 206C of the Act requires that every seller of alcoholic liquor for human consumption other than Indian made foreign liquor shall collect from the buyer 10 per cent. of the amount payable at the time of debiting the amount to the account of the buyer or at the time of receipt of any such amount in cash or by cheque or draft or by any other mode. It is thus clear that what is collectible is 10 per cent. of the amount payable. The amount payable is that amount which is payable at the time of debiting the amount to the account of the buyer or at the time of receiving money from him in cash or by cheque or by draft or by any other mode for the goods sold to him. That amount, in our opinion, is the purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X
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