TEXMACO LIMITED Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) In the case of Indian Cement v. State of A. P. concessions were given to manufacturers of cement within the State of Andhra Pradesh. The rate of sales tax in respect of sales made by cement manufacturers in the State to manufacturers of cement products also in the State was reduced. The validity of the notifications concerned was challenged by cement-manufacturing units that were not entitled to the concessions. The notifications issued under the Central Sales Tax Act, 1956 and the Andhra Pradesh General Sales Tax Act, 1957, were quashed on the basis that they impeded the free flow of trade between States. The order that this court passed read: In view of what we have indicated above, the writ petition has to succeed and the two impugned notifications of the Andhra Pradesh Government and the impugned notification of the Karnataka government are quashed. The writ petition is accordingly allowed with costs. Hearing fee is assessed at Rs 5,000. 00 and this shall be shared equally by the States of Andhra Pradesh and Karnataka. "

(2.) Pursuant to the said order, proceedings were commenced in the State to recover the amounts of the sales tax which would have been paid but for the two notifications (now referred to as "the concessional amounts") and assessment orders were made. Writ petitions under Article 32 were filed by those so affected seeking a declaration that the said order was prospective in nature and directions to quash recovery proceedings.

(3.) Emphasis was laid by Mr. Salve, learned counsel for the petitioners on the fact that the said order, while it was not prospective in operation, also did not give to the State permission to collect the concessional amounts. Attention was drawn by him to the provisions of S. 30-B and 30-C of the Andhra Pradesh General Sales Tax Act, by reason of which the petitioners could not collect the concessional amount from their customers and would have been liable to penalties if they had done so. Mr. Salve's submission was that it was, therefore, unjust and inequitable that the State should now seek to collect the concessional amounts from the petitioners. The provisions of Articles 32 and 142 enabled this court to do the just thing by the petitioners.