RAMESHWARA JUTE MILLS Vs. STATE OF BIHAR

JUDGEMENT

(1.) 1. Heard Mr. Ramesh Kumar Agrawal, counsel for the petitioner and Mr. Raj Nandan Prasad, J.C. to the Advocate General, representing the State.

(2.) THE petitioner is aggrieved by and seeks to challenge the order dated 19.9.2005 passed by the Commercial Taxes Officer, Samastipur by which he re-assessed the petitioner's liability for payment of sales tax for the period 2000-01. By the impugned Page 0719 order the Commercial Taxes Officer held the petitioner liable to pay an additional amount of Rs. 2,11,77,970.60 P as sales tax for the period in question. Adding to it the amount of penalty, the aggregate comes to Rs. 2,27,53,885/-.

(3.) MR. Agrawal assailed the re-assessment order coming under challenge on a number of grounds. However, his main ground of attack was that in view of the State Government's notification, dated 13.10.1986 any Inter State sale, of gunny bags could only be subjected to tax at the rate of 3% regardless of production or non production of the declaration in form 'D'. MR. Agrawal submitted that it was not in dispute that the sales were made in course of Inter State. Trade or Commerce and pointed out that though the declarations in Form 'D' produced by the petitioner were not accepted, the Commercial Taxes Officer subjected the sales to tax in terms of Section 8(2) of the CST Act. Learned Counsel pointed out that the State Government Notification, dated 13.10.1986 fixed the rate of tax on sale of jute bags in course of Inter State Trade or Commerce at the rate of 3% both for the purposes of Sub-section (1) and (2) of Section 8 of the CST Act and hence, even in case the sales were not covered by Sub-section (1) of Section 8 and fell under Sub-section (2) of that section, tax could not levied at a rate higher than 3%.