GOODAGE RUBBER WORKS Vs. STATE OF U P

JUDGEMENT

(1.) Challenging the validity of the notice dated August 27, 1991 issued by respondent No. 3 to modify the recognition certificate and the circular dated June 11, 1991 issued by the Commissioner of Sales Tax the present writ petition has been filed. The main question involved in the present writ petition is whether the Commissioner of Sales Tax having failed to establish his contention before the Trade Tax Tribunal that the product in question is not a "rubber product", can subsequently issue the impugned circular directing the authorities concerned not to treat "rubber roller" as "rubber product" and modify the recognition certificate accordingly.

(2.) The petitioner is manufacturer of rubber roller. According to the petitioner rubber roller have one iron rod which is coated with thick rubber shed. The iron rod on which rubber shed is coated is hollowed and the rubber rollers manufactured by the petitioner are mostly used in printing press. The rubber rollers required great experience and knowledge.

(3.) The recognition certificate under Section 4-B of the Act in form 19 was granted to the petitioner vide annexure 1 to the writ petition. For the assessment year 1981-82 a dispute was raised at the instance of the department that total exemption from tax on rubber roller manufactured by the petitioner, has been wrongly granted and the petitioner is not entitled for the total exemption on the raw materials, as the product produced by the petitioner is not rubber product. The matter went up to the Trade Tax Tribunal. The Tribunal by its order dated December 3, 1990 dismissed the appeal filed by the department and recorded a finding that rubber roller is rubber product. This order of the Tribunal has become final, as the department has not further challenged the said order. Thereafter the Commissioner of Sales Tax, issued a circular dated June 11, 1991. By the said circular the Commissioner of Sales Tax after obtaining legal opinion from the law department has observed that rubber roller is not rubber product and granting of total exemption on the purchase of raw material to the recognition holder is contrary to law. According to him only concessional rate of tax is admissible and not full exemption. In the light of the aforesaid circular the assessing authority issued notice dated August 27, 1991 to the petitioner, which is impugned herein. The said notice is under Section 4-B(iv) of the Sales Tax Act with a view to modify the recognition certificate No. 1621 dated July 29, 1981 and withdraw the total exemption and substitute the same by a concessional rate of tax. Challenging the aforesaid circular and notice present writ petition has been filed.