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TMI Blog1992 (9) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... es are L-13 licensees of liquor. They deal with the sale of country liquor and have been granted licences for the period April 1, 1992, to March 31, 1993. The licences have been granted to them at a fixed licence fee. At the time of purchase of liquor, incometax at the rate of 15 per cent. was charged by the distilleries. Some of the distilleries have also been impleaded as respondents. Apart from the income-tax, an additional surcharge at the rate of 1.8 per cent. of the total purchase price is also being charged. The distilleries are supposed to deposit this amount deducted towards income-tax into the treasury. Those distilleries are respondents Nos. 3 to 6. The petitioners purchased country liquor from them at the price fixed by the Exci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioners have approached this court in these writ petitions. The case of the petitioners is that the ratio of the decision of this court in K. K. Mittal's case which is reported as [1991] 187 ITR 208, would be applicable to the provisions of section 206C of the Income-tax Act as amended, as there is no practical change in the phraseology used with respect to L-13 licensees. On the other hand, the stand taken by the State in the written statement is that the validity of the provisions of sections 44AC and 206C of the Income-tax Act was unsuccessfully challenged in Sat Pal and Co. v. Excise and Taxation Commissioner [1990] 185 ITR 375, a Division Bench case of this court. That being the position, even from L-13 licensees, incometax cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to sell the country spirit to the retailers at a price so fixed by the Financial Commissioner from time to time. Sub-rule (g) further provides that the licensee shall sell country spirit at such rates as may from time to time be fixed by the Financial Commissioner and endorsed on the licence. Before K. K. Mittal's case [1991] 187 ITR 208 (P H) was decided by this court, the matter was considered by the Himachal Pradesh High Court in Gian Chand Ashok Kumar and Co. v. Union of India [1991] 187 ITR 188, and the case of Sat Pal [1990] 185 ITR 375 (P H), referred to above, was dealt with and distinguished and with respect of L-13 licensees, it was held that income-tax could not be deducted from the sales made to them by the distilleries und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 44AC(1) do not apply to buyers covered by the proviso. The demand of tax at the purchase point from the petitioners by the respondents has no authority of law and they are restrained from doing so. " In K K. Mittal's case [1991] 187 ITR 208 (P H), which is also reported in the same volume at page 208, the aforesaid passage from the judgment in Gian Chand's case [1991] 187 ITR 188 (HP) was reproduced and it was observed as under (at page 215) : "Therefore, so far as the case of L-13 licensees are concerned, the verdict rendered by the Himachal Pradesh High Court in Gian Chand Ashok Kumar's case [1991] 187 ITR 188 is the complete answer to the questions of law raised before us. We also have ourselves closely examined the matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - (1) (2) (3) -------------------------------------------------------------------------------------------------------------------------------------------------- (i) Alcoholic liquor for human consumption (other Fifteen per cent. than Indian-made foreign liquor) (ii) Timber obtained under a forest lease Fifteen per cent. (iii) Timber obtained by any mode other than under Five per cent. a forest lease (iv) Any other forest produce not being timber Fifteen per cent. -------------------------------------------------------------------------------------------------------------------------------------------------- Provided that, where the Assessing Officer, on an application made by the buyer, gives a certificate in the prescri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly to the present case. The collection of income-tax from L-13 licence holders would be arbitrary if 16.8 per cent. is collected from the petitioners at the time of making purchase of the liquor, otherwise income-tax is payable on the income and, in the case of L-13 licensees, this income would be marginally nominal profit, i.e., difference between the purchase price and the selling price, as stated above. Learned counsel for the respondent has pointed out that the Supreme Court, on March 31, 1992, staved the operation of the judgments of three High Courts including the judgment of this court in K. K., Mittal's case [1991] 187 ITR 208, and thus the judgment in K. K. Mittal's case [1991] 187 ITR 208 (P H), cannot be followed as a precede ..... X X X X Extracts X X X X X X X X Extracts X X X X
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