J.K.Lakshmi Cement Ltd vs Commercial Tax Officer,Pali

Civil Appeal No. 102 of 2010 The appellant is a Public Limited Company incorporated under the Companies Act, 1956 and engaged in the business of manufacturing and selling Grey Portland Cement. In exercise of powers conferred by Section 8(5) of the Central Sales Tax Act, 1956 (for short, “CST Act”), the Government of Rajasthan had issued a Notification No. F4(72)FD/Gr.IV/81-18 dated 06.05.1986 allowing partial exemptions from the sales tax payable in respect of inter-State sales in the manner and subject to the conditions mentioned therein. Partial exemption was granted under the said notification at the rate of 50%/75% on the basis of increase in the percentage of the entire inter-State sales and decrease in percentage of stock transfers but the benefit under the said notification was not available on levy cement. From the assessment year 1989-90 to 1997-98 the appellant had been granted benefit of partial exemption under the notification dated 06.05.1986 except for the assessment year 1995-96 and 1996-97 as no claims were made by the appellants being not eligible.

4. By Notification No. 97-122 dated 12.03.1997 issued under Section 8(5) of the CST Act, the State Government rescinded the Notification No. 94- 70 dated 07.03.1994 and directed that CST on inter-State sales of cement shall be calculated at the rate of 4% inter alia subject to fulfilment of the condition that the dealer making inter-State sales under this notification shall not be eligible to claim benefit provided by partial exemption notification dated 06.05.1986. This notification remained in force upto 31.03.1998.

12. Being aggrieved by the order of the appellate authority, the revenue approached the Rajasthan Tax Board in appeal contending, inter alia, that as per circular dated 16.04.2001 the benefit could not be claimed under notification dated 06.05.1986 if the unit had made sales under notification dated 21.01.2000. In essence, it was urged that benefit of both the notifications could not be availed of in the same financial year. The Tax Board allowed the appeal filed by the revenue. Against the order of the Tax Board, the appellant filed revision petition before the High Court and the learned Single Judge vide order dated 17.04.2009 considering the submissions put forth by the parties and upon analysing the principle stated in Tata Cummins Ltd. v. State of Jharkhand[1], M/s Vividh Marbles Pvt. Ltd. v. Commercial Tax Officer[2], State of Rajasthan v. J.K. Udaipur Udyog Ltd. and another[3], MRF Ltd. Kottayam v. Asstt. Commissioner (Assessment) Sales Tax and ors.[4] and other authorities came to hold that condition no. 3 of Notification No. 21.01.2000 has to be given its plain and clear meaning and cannot be restricted only to the specific transaction of sale covered by notification dated 21.01.2000 itself and when the condition no. 3 unequivocally states that once the assessee avails of the benefit of concessional rate of tax under notification dated 21.01.2000, he cannot get the partial benefit as envisaged in the Notification dated 06.05.1986 and accordingly repelled the stand of the assessee.

This notification shall come into force from 1st April, 1994 and shall remain in force upto 31st March, 1997.”

State transactions would qualify and would be entitled to partial exemption under the notification dated 06.05.1986, when accompanied with Form C and D and for inter-State sale transactions without Form C and D, benefit of notification dated 07.03.1994 would apply.

30. In view of the aforesaid analysis, we do not find any merit in the instant appeal and the same is, accordingly, dismissed. There shall be no order as to costs.

31. In view of the judgment passed in Civil Appeal No. 102 of 2010, this appeal also stands dismissed. There shall be no order as to costs.

September 16, 2016