LAKSHMI CEMENT Vs. STATE OF RAJASTHAN

JUDGEMENT

(1.) THE petitioner is a company which is engaged in the business of manufacturing and selling of Portland cement. THE company is a registered dealer under the Rajasthan Sales Tax Act, 1994 hereinafter referred to as "the RST Act" and the Central Sales Tax Act, 1956 (hereinafter referred to as "the CST Act"). It is claimed by the petitioner that the Government of Rajasthan issued Notification No. F. 4(72)FD/GR.IV/81-1-S dated May 6, 1986. By this notification, partial exemption was granted from the tax payable in respect of inter-State sales in the manner and subject to the conditions mentioned in the notification. THE petitioner claims that this partial exemption from tax payable on inter-State sales is given to reduce branch/stock transfers on which no tax is leviable under the CST Act. THE petitioner claims that the present writ petition is not related to quantum of exemption available under the notification. THE dispute circles around the sale of levy cement. THE case of the petitioner is that in computing the tax, levy cement cannot be taken into account. THE figures of levy cement have to be excluded from levy of tax.

(2.) THE petitioner further claims that in terms of clause (1) of the aforesaid notification, benefit is allowable to the petitioner on the basis of its percentages of branch transfers. THE base year for the purpose of the notification is claimed to be from April 1, 1984 to March 31, 1985. THE petitioner moved an application before the regular assessing authority, i.e., Commercial Taxes Officer, Special Circle, Pali. It was requested by the petitioner in the application that the percentages of inter-State sales and branch transfers of non-levy cement be determined for the base year 1984-85. This was required to follow the benefit under the notification dated May 6, 1986. THE Commercial Taxes Officer, Special Circle, Pali, after verifying and scrutinising the records of the petitioner determined the following percentages of inter-State sales, branch transfers and intra-State sales of non-levy cement of the base year 1984-85 in terms of the notification. Excluding levy sales Quantity in MT percentages Branch transfers 226839.800 85.28% Inter-State sales 6667.400 2.51% Sales 32488.550 12.21% 265995.750 100.00% Regular CST assessments for the assessment year 1989-90 April 1, 1989 to March 31, 1990 and 1990-91 (April 1, 1990 to March 31, 1991) were made by the regular assessing authority. An application for rectification was moved by the petitioner in view of the order dated February 3, 1995 by virtue of which the branch transfers, inter-State and intra-State sales were delineated by the C.T.O., Pali. THE rectification applications filed by the petitioner were rejected by the assessing authority vide order dated September 21, 1996 on the ground that claim for partial exemption was not made in time. THE order of rejection was challenged by the petitioner. THEy filed two appeals before the Deputy Commissioner (Appeals). THEse appeals were allowed by the appellate authority vide common order dated December 26, 1998 and the matter was remanded back to the assessing authority to allow the benefit of partial exemption in respect of inter-State sales of non-levy cement.

(3.) THE claim for the partial exemption for the year 1997-98 and 1998-99 is pending before the Rajasthan Tax Board and Deputy Commissioner (Appeals) It has also been claimed by the petitioner that partial exemption has been allowed in relation to 1989-90, 1990-91, 1991-92, 1992-93 and 1993-94 by the first appellate authority THE assessing authority has also granted exemption for the years 1994-95 and 1997-98 on the basis of notification. THE petitioner alleges that a survey was conducted by Antievasion, Circle I, Jaipur, respondent No. 2 at the business premises of the petitioner on February 16, 2001 and purportedly examined the partial exemption already granted to the petitioner for the year 1997-98 THE petitioner's representative fully apprised the officers conducting the survey of the entire position and complete history and convinced them of the purport of the notification dated May 6, 1986 However, the survey officers were not fully convinced and respondent No. 2 has given reassessment order dated April 19, 2001 to the petitioner, inter aha, stating that partial exemption has been wrongly granted in relation to the assessment year 1997-98 By the said notice, the petitioner has been called upon to show cause as to why the said exemption be not withdrawn and penalty under section 65 of the RST Act be not imposed THE said notice is under challenge in the present writ petition.