TaxTMI 
TaxTMI 
1988 (5) TMI 327
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....y the State of U.P. against the judgment dated 3rd January, 1973 of the Allahabad High Court in W.P. No. 4225 of 1971, raises a short question whether rule 25-A(5) of the U.P. Sales Tax Rules, 1948 ("Rules") in so far as it stipulates that a "recognition certificate" issued for purposes of section 4-B of the U.P. Sales Tax Act, 1948 "shall take effect from the date of its issue" is inconsistent with, does not carry out the purposes of and, therefore, is ultra vires, section 4-B of the U.P. Sales Tax Act, 1948 ("Act"). The Full Bench of the Allahabad High Court, by a majority, has, by the judgment under appeal, preferred this view. So far as the declaration on the law on the point is concerned, the matter loses much of its edge in view of ....
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....-B and that the purchases by the dealer liable to tax on the turnover of the first purchases shall be entitled to a concessional rate of tax at 2 per cent on the raw material required for the manufacture of notified goods. The present controversy relates to the dealer's entitlement to the concessional rate of purchase tax respecting the purchase turnover of its first purchases under the said notification. On 21st March, 1969, the respondent applied under section 4-B(2) to the prescribed authority, in the prescribed form for the grant of a recognition certificate. The recognition certificate, for certain reasons, was granted only on 5th December, 1969. There appears no dispute that the turnover of the first purchases of the respondent, res....
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....ble to tax under any other section are sold by a dealer to another dealer and such other dealer furnishes to the selling dealer in the prescribed form and manner a certificate to the effect that he holds a recognition certificate issued under sub-section (2) in respect thereof, the selling dealer shall be liable in respect of those goods to tax at such concessional rate, or be exempt from tax, as may be notified in the Gazette by the State Government in that behalf. (2) A dealer who requires any goods referred to in sub-section (1) for use as raw material for the purposes of manufacture in the State of Uttar Pradesh of any notified goods, and such notified goods are intended to be sold by him in the State or in the course of inter-State tr....
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....ate fructifies. A dealer would be entitled to the concessional rate if he holds a recognition certificate..........." "...........The language of clause (b) does not make it a condition precedent or a necessary obligation that the purchasing dealer must at the time of the purchase produce the recognition certificate. If the purchasing dealer, subsequent to the transaction of purchase, furnishes to the selling dealer the certificate that he holds a recognition certificate, the requirements of clause (b) are fully satisfied." The High Court also took into account that sub-rule (5) of rule 25-A, while rightly recognising the need for the issue of the certificate with due despatch and within a time bound schedule, could not, consistently with....
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.... to be satisfied if the dealer holds such a "recognition certificate" at the time of the assessment of the turnover in question. The High Court has held that the requirements of the section are substantially complied with if the certificate is available to the dealer at the time the liability to tax of the turnover in question is sought to be determined, subject to the requirement that the turnover is after the date of the application filed by the dealer for issue of a certificate. According to the High Court, the date of actual issue of the certificate should not be held to be material and that the benefit for the concessional rate of tax should be available to the dealer if the dealer, at the time of the assessment, holds a recognition ce....