MAHAVIR COKE INDUSTRIES Vs. COMMISSIONER OF TAXES ASSAM

JUDGEMENT

(1.) PETITIONER is a partnership firm engaged in manufacturing and processing of coal into coke. Petitioner is a dealer registered under the Assam Finance (Sales Tax) Act, 1956 (for short "the Act') and under section 7 of the Central Sales Tax Act, 1956 (for short "the Central Act" ). Sales by the Petitioner would be liable for sales tax under the Act. The Act was amended by the Assam Industries (Sales Tax Concessions) Act, 1986, that is Assam Act 1 of 1987, for short "the 1987 Act". By one of the amendments section 3b was introduced in the Act. This provision enables the State Government by notification to grant exemption to dealers in respect of sales of goods produced by the dealer in any new industrial unit for a period of five years from the date of commencement of the production in the unit. The State Government published Notification No. FTX. 28177/pt. II/40 in the Assam Gazette, Extraordinary dated August 1, 1988, directing that no dealer shall be liable to pay tax under the Act in respect of sales of goods produced by him in any new industrial unit in Assam for a period of five years from the date of commencement of production in the unit subject to the conditions mentioned therein. Petitioner took the stand that exemption from sales tax by virtue of the above notification under section 3b of the Act is general in nature. Petitioner further contended that by virtue of section 8 (2-A) of the Central Act, he is entitled to exemption under the Central Act also. The assessment was completed on the basis that the petitioner was exempted under the Central Act but the Assistant Commissioner in suo motu revision took the view that the exemption is not available and directed assessment to be made afresh. That order is under challenge in another writ petition. While so, for the succeeding period the Superintendent of Taxes issued notice to the petitioner that he is not entitled to exemption. That notice is now challenged.

(2.) THERE is no dispute that the petitioner manufactures coke using coal as a raw material and sells the finished products. It is also admitted that coke is produced in a new industrial unit and during the period of exemption covered by the notification referred to above. There is no dispute that the petitioner is entitled to such exemption. The short question is whether this exemption will enable him to obtain exemption under section 8 (2-A) of the Central Act.

(3.) ACCORDING to the learned Government Advocate exemption in this case is not exemption from "tax generally" and it is exemption only "in specified circumstances or under specified conditions" and therefore section 8 (2-A) is not attracted. In Muli Bash Hasta Silpa Samabaya Society Ltd. v. State of Assam (1992) 1 GLR 46 corresponding to (1992) 1 GCJ 86, this Court held that sale of goods produced by a society of khadi and village industries which is entitled to exemption under the State Act is also entitled to exemption under the Central Act relying on various decisions of the Supreme Court referred to in paragraph 11 of the judgment. Our attention is also invited to a later decision of the Supreme Court in Pine Chemicals Ltd. v. Assessing Authority [1992] 85 STC 432; (1992) 2 SCC 683. The provisions of section 8 (2-A) have to be read in the light of the provisions in section 3b of the State Act and notification. It is not general exemption as such but exemption from tax generally. If the exemption is only in specified circumstances or under specified conditions, it will not fall under the category of exemption from tax generally. If the exemption is not in specified circumstances or not under specified conditions, it will he a case of exemption from tax generally.