ASSOCIATED CEMENT COMPANIES LTD Vs. GOVERNMENT OF KARNATAKA

JUDGEMENT

(1.) The appellant is the dealer under the Central Sales Tax Act (hereinafter referred to as the 'Act') having its registered office at Bombay and regional office at Bangalore. The appellant had filed returns for the assessment years 1986-87 and 1987-88 and the assessments were complete on February 29, 1992 and September 26, 1992 respectively. The assessments were completed on the basis of the appellant being entitled to the benefit of notification dated February 28, 1987 issued in exercise of powers conferred by Sub-section (5) of Section 8 of the Act. The notification inter alia provided that the rate of tax payable on the sales of cement made in the course of inter-State trade or commerce stands reduced from 15% to 2%.

(2.) On January 12, 1988 Supreme Court delivered the judgment reported in the Indian Cement and Others v. State of Andhm Pradesh and Others AIR1988 SC 567 , JT1988 (1 )SC 86 , 1988 (1 )SCALE43 , (1988 )1 SCC743 , [1988 ]2 SCR574 , [1988 ]69 STC305 (SC ), 1988 (1 )UJ416 (SC ). The Supreme Court was examining the notification issued by the Government of Andhra Pradesh and which notification was almost parallel to the notification issued by the Government of Karnataka. The Supreme Court while examining the notification issued by Andhra Pradesh had also issued notice to the State of Karnataka to show cause why the notification of the Karnataka Government should not be struck down. The Supreme Court held that the notification issued by the Karnataka Government was null and void and was struck down. In pursuance of the decision of the Supreme Court the Government of Karnataka published notification on March 30,1988 rescinding the earlier notification dated February 28, 1987.

(3.) The Addl. Deputy Commissioner of Commercial Taxes, Bangalore, re-assessed the appellant by order dated December 14, 1992 for the two assessment years 1986-87 and 1987-88 and the liability of about Rs. 10 crores was found payable by the appellant. The appellant had the right of appeal against the order of reassessment. The appellant preferred to approach this Court by filing writ petition under Articles 226 and 227 of the Constitution. The reliefs sought in the petition were (a) quashing of re-assessment order dated December 14, 1992 and demand notice dated December 18, 1992, (b) quashing of Government Order dated February 12, 1992, and (c) quashing of clarification issued by the Commissioner of Sales Tax on June 29, 1992 and February 11, 1988. The principal grievance of the appellant was that the re-assessment orders were passed on the basis of the circulars and Government Orders and, though the instructions and circulars were not as per the decision of the Supreme Court. The learned single Judge by order dated January 21, 1993 dismissed two petitions for the two assessment years observing that the circulars issued by the Government and the Commissioner are in conformity with the orders of the Supreme Court and therefore it is not necessary to entertain the writ petitions. The appellant carried the appeals before the Division Bench of this Court/ but the appeals ended in dismissal by order dated February 8, 1993. While dismissing the appeals Division Bench observed that the appellant is at liberty to file a review application before the learned Single Judge. Taking advantage of the observation, the appellant did file review petition before the learned single Judge, but it met the fate of dismissal by order dated February 15, 1993. The appellant has now come in appeal against the order of the learned single Judge refusing to review the order of dismissal. The appellants have secured the stay of demand notice for recovery of Rs. 10 crores.