STEEL AUTHORITY OF INDIA Vs. ADDITIONAL COMMISSIONER

JUDGEMENT

(1.) The present is a petition whereby the petitioner-Steel Authority of India assails the order of assessment dated 20.12.1999 (Annexure P/1) passed by the Assistant Commissioner, Commercial Tax, Durg, and which has been affirmed in a revision by the Additional Commissioner, Commercial Tax vide its order dated 13.10.2006 (Annexure P/3).

(2.) The matter pertains to levy of entry tax on raw material imposed under the provisions of Chhattisgarh Sthaniya Kshetra Me Mal Ke Pravesh Par Kar Adhiniyam, 1976 (for short, the Entry Tax Act, 1976). Initially the rate of entry tax was 0.5 percent which was subsequently raised to 1 percent. However, the State Govt. amending the Act inserted Section 4A empowering the State Govt. for levying of entry tax up to 10 percent by issuance of notification in this regard. This imposition of entry tax up to 10 percent was subjected to litigation before the High Courts by numerous petitions which went up to Supreme Court. Meanwhile, the petitioner-company and similarly placed companies, pending the litigation before the Supreme Court, were not paying entry tax to the Govt. for the reasons that there was no payment of entry tax by the petitioner company.

(3.) The State Govt. called upon the petitioner for an amicable settlement and a meeting in this regard was convened by the Chief Secretary of the State and Minutes of Understanding (in short MoU) was entered into wherein it was agreed that for the assessment year 1992-93, entry tax shall be restricted to rupees 47 Crores towards full and final settlement inclusive of tax and penalty. That a schedule was also prepared for the payment of this 47 Crores, agreed amount, and which in due course of time has been honoured by the petitioner- company. However, after having entered into MoU restricting the claim by the State Govt. towards entry tax for the assessment year 1992-93 at rupees 47 Crores, which has been paid by the petitioner's company, the respondents later proceeded with the assessment proceeding for the aforesaid period in contravention to the MoU.