BHARAT OIL INDUSTRIES Vs. STATE OF U P

JUDGEMENT

(1.) THE petitioner, a proprietorship concern is carrying on the business of manufacture and sale of mustard oil, oil cake (Khali) etc. It is regularly filing its return of turnover under the U. P. Trade Tax Act and has deposited the tax on the taxable turnover for the months April, May, June and July.

(2.) IN exercise of power conferred on the State Government under Section 7-D of the U. P. Trade Tax Act, the State Government promulgated a composition scheme dated 25. 7. 06. Under the said scheme such dealer is required to pay a fixed amount as provided therein in lieu of trade tax. The petitioner in order to avail the benefit of the said scheme applied there under and deposited the necessary amount of Rs. 3, 33, 334/ -. The said amount was deposited at the time of making the application and it is being continuously deposited month after month as per the said scheme. The business premises of the petitioner was also surveyed in the light of the application filed by the petitioner under the said scheme. Later on the State Government found that under the said scheme the expected amount of Rs. 750y- Lakhs was not collected as Revenue, which was the essential condition under the said scheme for its continuance, the State Government through the Commissioner of Trade Tax directed the Assessing Authorities to realise the actual trade tax from such dealers who had applied for under the said scheme for payment of lump sum amount in lieu of trade tax and also to recover interest on the deficient amount of tax. A copy of the said circular dated 15th of February, 2007 has been annexed as Annexure-4 to the writ petition. IN pursuance thereof the Assessing Authority of the petitioner issued the impugned notice dated 27th of July, 2007 under the Rule 41 (6) asking it to deposit the balance trade tax dues with interest. Aggrieved by the said notice dated 27. 7. 2007 the present writ petition has been filed for quashing the letter dated 15th of February, 2007, Annexure-4 to the writ petition as also the notice dated 25. 7. 2007 (Annexure-6 to the writ petition) and mandamus directing the respondents to treat the composition scheme as valid for assessment year 2006-07 with consequential reliefs.

(3.) CONSIDERED the respective submissions of learned Counsel for the petitioner. Argument of the learned Counsel for the petitioner presupposes that the alleged scheme dated 25th of July, 2006 was concluded scheme applicable to the manufacturers of mustard oil and cake. It is not so. In the scheme there is an inbuilt provision which lays down that the scheme shall be declared effective only when such dealers who apply within three months from the date of scheme and the minimum collection of trade tax revenue to the extent of Rs. 750 Lakhs or more is assured. On a fair reading of the scheme it is evident that this was a simple proposal by the State Government with the concurrence of the Governor inviting applications from mustard oil manufacturers to apply under the scheme. The enforcement of scheme was dependant and was subject to the minimum collection of Rs. 750 Lakhs or more as tax revenue. This clause is indicative of fact that it was not an unconditional or concluded scheme. At the most the State Government was exploring to promulgate such scheme and for that purpose Government order dated 25th of July, 2006 was published.