MINI GUPTA BRICKS COMPANY Vs. STATE OF HARYANA

JUDGEMENT

(1.) THE facts of the case, which are not dispute, are that the petitioner,] a partnership concern, started the business of brick-kiln in November, 1989 and obtained registration certificate, annexure P1, in form ST III under the Haryana General Sales Tax Act, 1973 (hereinafter referred to as "the Act") with liability to pay tax with effect from November 2, 1989. In response to notice, annexure P2, dated February 15, 1990, the petitioner deposited tax for the whole year under protest. The petitioner paid tax for the first three quarters from April 1, 1989, to December 31, 1989 vide treasury receipt dated January 30, 1990, for Rs. 33,750 and for the fourth quarter vide treasury receipt dated April 16, 1990, for Rs. 11,250. Through this petition, the vires of rule 39-A (8) of the Haryana General Sales Tax Rules, 1975 (hereinafter referred to as "the Rules") has been challenged as being beyond the legislative competence of the State Government and the main relief sought by the petitioner is that the petitioner is not liable to pay any tax prior to the period November 2, 1989. In the return, the facts have not been disputed. It is maintained that rule 39-A (8) of the Rules is not ultra vires and the same is valid and under that rule, the petitioner is liable to pay lump sum amount for the whole year. It is not disputed that by a notification dated August 27, 1990, a proviso has been added to sub-rule (8) of rule 39-A in the following terms :

(2.) THE words which have underlined clearly bring out the meaning which has been there all along and which has now been clarified by the addition of the proviso to sub-rule (8) of rule 39-A of the Rules. The methodology which can be provided by making rules can lay down the formula for working out a lamp sum amount for the period for which tax is payable. There can be no dispute that under the garb of that formula tax cannot be levied where admittedly the business had not even been started. It bears repetition that, in the facts of the present case, the liability to pay tax commenced with effect from November 2, 1989. It is inconceivable that either section 26 or rule 39-A (8) intended the liability prior to November 2, 1989. It is necessary to deal with the larger question whether rule 39-A (8) is ultra vires or not, especially as no such difficulty is likely to arise because of the insertion of the proviso to sub-rule (8 ). Learned counsel appearing for the State was unable to justify how tax could be levied for period to November 2, 1989.