TMI Blog1996 (4) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... UPREME COURT OF INDIA]. It is obvious that the said decision shall guide the authorities in the matter. - Civil Appeal No. 5969, 5971, 5972, 5984 of 1994, 6, 1330, 1331, 3256, 5141, 9513 of 1995, - - - Dated:- 9-4-1996 - JEEVAN REDDY B.P. AND SAGHIR AHMAD S. JJ. Altaf Ahmed, Additional Solicitor-General for India (Sushil Kumar Jain, Advocate, with him), for the appellants. Haish N. Salve, Senior Advocate (Ranjit Kumar and Ms. Bina Tamta, Advocate, with him), for the respondents. -------------------------------------------------- The judgment of the Court was delivered by B.P. JEEVAN REDDY, J.- These appeals are preferred against the judgment of a Division Bench of the Rajasthan High Court allowing a batch of special appeals filed by the respondents-assessees. The special appeals were preferred against the common judgment of a learned single Judge of that Court dismissing the writ petitions filed by them. The matter arises under the Central Sales Tax Act, 1956. The respondents-assessees are manufacturers and/or dealers in edible oils and stainless steel sheets. the relevant years, they effected a large number of inter-State sales to various dealers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tration of the purchasing dealers, which are intended either for resale or for being used as raw material for manufacturing other goods or for other purposes mentioned in the sub-section. Sub-section (4) then states: "(4) The provisions of sub-section (1) shall not apply to any sale in the course of inter-State trade or commerce unless the dealer selling the goods furnishes to the prescribed authority in the prescribed manner- (a) a declaration duly filled and signed by the registered dealer to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribed authority; or (b) if the goods are sold to the Government, not being a registered dealer, a certificate in the prescribed form duly filled and signed by a duly authorised officer of the Government: Provided that the declaration referred to in clause (a) is furnished within the prescribed time or within such further time as that authority may, for sufficient cause, permit." Sub-section (5) confers upon the State Government the power of exemption. The power of exemption can be exercised both with reference to dealers as well as with reference to goods. The exemption can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder sub-section (1) are taxed at higher rates provided in sub-section (2). [We are not referring to sub-section (2-A) because it is not relevant for the present purposes.] Sub-section (3) specifies the goods for the purposes of section 8(1)(b). Sub-section (4) is really in the nature of a proviso to sub-section (1). Sub-section (4) imposes a condition which must be satisfied by the dealer seeking to avail of the rate of tax provided by sub- section (1). The condition prescribed by sub-section (4) is- (a) if the goods are sold to a registered dealer, the selling dealer-assessee should furnish to his assessing officer a declaration duly filled and signed by the registered dealer purchasing the goods containing the prescribed particulars in the prescribed form obtained from the prescribed authority; (b) if the goods are sold to Government, not being a registered dealer, a certificate in the prescribed form duly filled and signed by a duly authorised officer of the Government should be furnished by the selling dealer-assessee to his assessing authority. The Rules made under the Act prescribe the forms in which the aforesaid declaration and certificate, as the case may be, has to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... crucial significance of the C form needs to be kept in mind. Sub-section (5) of section 8 confers the power of exemption upon the State Government. As is well-known, almost every taxing enactment contains such a provision. The exemption under section 8(5) can be granted either with reference to dealers or class of dealers or with reference to goods or classes of goods. The exemption can be total or partial. It can also be subject to such condition as may be prescribed in that behalf. In these appeals, we are concerned with two exemption notifications issued under section 8(5). They are dated December 26, 1986 and April 17, 1990 (which was issued in supersession of the notification dated December 26, 1986). It would be appropriate to set out both the notifications: "Notification No. F.4(92) FD/Gr. IV/82-41 Jaipur dated December 26, 1986. S.O. 153- In exercise of the powers conferred by sub-section (5) of section 8 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956), and in supersession of Finance Department Notification No. F.2(8) FD/Gr. IV/75-15, dated July 1, 1975, the State Government being satisfied that it is necessary so to do in the public interest hereby ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch dealer shall not be entitled to claim partial exemption under Finance Department Notification No. F.4(72) F. 81-18, dated 6th May, 1986 and as from time to time. [Published in Rajasthan Gazette, Extraordinary, Part IV-C(II) dated April 18, 1990]." A reading of the notification of December 26, 1986 shows that the exemption granted under the notification is not total but partial. As against 4 per cent leviable under section 8(1), the notification provides that the tax shall be paid at the rate of 1 per cent or 2 per cent, as the case may be. The exemption applies to and extends to all edible oils excluding those oils as are specified in the notification. Further, the exemption is subject to a condition, viz., that the dealer claiming the exemption imposed satisfies the assessing authority that the oil-seeds purchased for the manufacture of such oil have been subjected to tax in accordance of with section 5C of the Rajasthan Sales Tax Act, 1954, in which case, the sales tax will be charged at the rate of 1 per cent; in case the oil-seeds purchased for the manufacture of such oil have been subjected to tax under section 5CC of the Rajasthan Act then the rate of tax leviable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions but by the Act itself. Section 8(1) prescribes the rate and sub-section (4) the condition that has to be satisfied for availing of the rate in sub-section (1). What the notifications do is to reduce the rate prescribed by section 8(1) further, subject to certain conditions. The conditions prescribed by the notifications are the conditions prescribed for availing the further reduction of rate provided by the notification. The notifications merely reduce the rate of tax; they do not do away with the levy altogether. All that the notifications have done is to reduce the rate of tax from 4 per cent to 1 per cent (2 per cent, as the case may be). Separate conditions are prescribed for availing the rate (which itself is a concessional rate) prescribed in section 8(1) and for availing the further reduction provided by the notification. Those two sets of conditions are prescribed by section 8(4) and by the notifications respectively. One cannot conceive of the said notifications independent of, or apart from section 8(1). They merely reduce the rate in section 8(1) as already mentioned. One must first satisfy the condition in section 8(4) to become eligible for the concessional rat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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