NEW KARNAL TRADING CO Vs. STATE OF HARYANA

JUDGEMENT

(1.) The petitioner, a partnership firm, is a registered dealer under the Haryana General Sales Tax Act, 1973 (for short "the Act"), and is engaged in purchase and sale of common salt amongst other things. The petitioner sells salt in polythene/transparent cellophane packets. No sales tax was being charged on the sale of salt by the petitioner up to the assessment year 1983-84 in view of the exemption granted under item 5 of Schedule B to the Act under which common salt is an exempted item "except when sold in sealed containers". According to the petitioner, the plastic bag is merely a cheap mode of packing and could not be described as a sealed container and, therefore, the common salt sold by it was an exempted item. It has been pointed out that the Excise and Taxation Commissioner, Haryana, had issued instructions on December 1, 1986, to the following effect :

(2.) The petitioner states that according to the above instructions, the salt sold in plastic bags became liable to tax. A copy of the instructions communicated to the sales tax authorities on December 19, 1986 has been placed as annexure P-1 with the writ petition.

(3.) It is alleged that on the basis of the instructions of the Commissioner, the Deputy Excise and Taxation Commissioner (Inspection), Karnal, in exercise of his revisional powers, decided to reopen the assessment for the year 1983-84 which had already been finalised, to levy tax on the sale of salt sold in plastic bags which had earlier been exempted. A copy of this notice dated October 20, 1987 has been placed as annexure P-2 with the writ petition. Proceedings for the assessment year 1984-85 were also taken up by the Assessing Authority, Karnal, vide notice dated August 7, 1987 for computing the liability of tax of the petitioner. It is at this stage that the petitioner had filed the present writ petition praying that the instructions issued by the Commissioner, annexure P-1, and the notice for reopening the assessment for the year 1983-84, annexure P-2, be quashed and the Assessing Authority, Karnal, be restrained from levying tax on salt sold in plastic bags by the petitioner.