TMI Blog2007 (11) TMI 585X X X X Extracts X X X X X X X X Extracts X X X X ..... issued the impugned order, dated March 4, 2005 to the petitioners, demanding the tax at 16 per cent. In fact, the demand made by the respondents is nothing, but an order imposing additional burden of indirect tax on the petitioners with retrospective effect, which is not legally sustainable. Thus to meet the ends of justice, all the writ appeals have to be allowed, setting aside the impugned orders passed by the respondents. - 614,615, 616 of 2005 - - - Dated:- 16-11-2007 - MISRA P.K. AND TAMILVANAN S. , JJ. The judgment of the court was delivered by S. TAMILVANAN J. These writ appeals have been preferred against the common order, dated March 15, 2005 passed by the learned single judge, dismissing the writ petitions in W.P. Nos. 8569, 8570 and 8571 of 2005, with a direction to seek the remedy of statutory appeals before the appellate authority. It is seen that the question of law involved in both the writ appeals is one and the same, hence, common judgment is being passed in the writ appeals. In the writ petitions/writ appeals, the relief sought for is for issuance of writ of declaration to declare that the revised order, dated March 4, 2005, passed under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tamil Nadu v. Devendran Company [1996] 103 STC 95 (SC). 4.. G. Venkatakrishnaiah Brothers v. State of Andhra Pradesh [1993] 90 STC 405 (AP). 5.. Assistant Commissioner of Sales Tax, Kerala v. P. Kesavan Co. [1996] 100 STC 514 (SC). Mr. R. Gandhi, learned senior counsel appearing for the appellants herein mainly relying on the decision, Pizzeria Fast Foods Restaurant (Madras) Pvt. Ltd. v. Commissioner of Commercial Taxes, Chennai reported in [2005] 140 STC 97 (Mad); [2005] 1 CTC 629, contended that the writ petitions are maintainable under article 226 of the Constitution, since the appellate authority had pre-conclusion by issuing subsequent clarification letter, dated May 18, 2004, stating that the sales tax payable for bajji, bonda mix was at 16 per cent and also directed to demand the same by implementing the direction of clarification, virtually with retrospective effect. It is clear that in Union of India v. Ahmedabad Electricity Co. Ltd. reported in [2004] 134 STC 24, the honourable Supreme Court has held that once a circular is issued by the superior officer, any objection to the same before the subordinate officer would be a futile attempt. Since the impug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inate to the Commissioner and therefore, will be inhibited from taking a different view. It is seen that a similar view was taken by the Karnataka High Court in Arif Transport v. Commercial Tax Officer reported in [1999] 116 STC 207. In Etikoppaka Co-operative Agricultural Society Ltd. v. Union of India reported in [1979] ELT (J533), the Andhra Pradesh High Court held that once the highest authority constituted under the Act has pre-determined the question and directed all subordinate authorities to interpret a notification in a particular manner, the statutory remedy of appeal and revision ceased to be an effective alternative remedy. Hence, writ petitions filed under article 226 of the Constitution is maintainable. It is seen that writ appeals in W.A. No. 614 of 2005 relates to Sakthi Masala (P) Ltd., for the taxable year 2002-03, W.A. No. 615 of 2005 relates to Shanthidevi Spices (P) Ltd., for the year 2002-03, W.A. No. 616 of 2005 relates to Sakthi Trading Company for the year 1998-99. The question of law involved in all the writ appeals are one and the same, as discussed earlier. It is not in dispute that the appellants are engaged in manufacturing spices and masala p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 121, dated May 28, 1999, ginger coriander powder (sukku coffee) and bonda, bajji mix, which are the subject-matter in the writ appeals herein were originally stated to be products falling under entry 22 C in Part B of the First Schedule, taxable at four per cent, since the above said entry items represents masala powder, but subsequently, as per the aforesaid letter clarified that item number 4 (III) denotes foods, including preparation cereals, as was clarified by the Commissioner, and hence, taxable at 16 per cent under entry 3 of Part B of the First Schedule. It is not in dispute that as per Letter No. D. Dis. Acts Cell-III/45190/ 2001, dated November 1, 2001, Special Commissioner and Commissioner of Commercial Taxes, Chennai has informed the Turmeric and Masala Powder Manufacturers Association, Erode that bonda mix, bajji mix containing flour of gram, rice, ragi mixed with masala powders or spices will fall under entry 22 C in Part B, for which the tax payable was fixed at four per cent. As per the order, dated July 8, 2002, it has been specifically clarified by the Commissioner of Commercial Taxes, Chennai that bonda mix, bajji mix, etc., are taxable only at four per cent u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mix and ginger coriander mix is at four per cent, as per entry 22C in Part B of the First Schedule, stating that the same would fall under the aforesaid entry of the Act for the assessment year 2002-03, by way of subsequent clarification, dated May 18, 2004, it cannot be made at 16 per cent, so as to effect the same with retrospective effect, as the same is not sustainable in law. In view of the facts and circumstances and the circular and clarification issued by the first respondent, the assessment of sales tax for bonda, bajji mix powder and ginger coriander mix was only four per cent and accordingly, the assessment for the year 2002-03 was completed as early as October, 2003 which is not in dispute. The learned counsel for the appellant contended that the order dated March 4, 2005 passed by the second respondent claiming sales tax at 16 per cent for bonda, bajji mix, stating that it was food item, falling under entry 4 of Part B of the First Schedule and ginger coriander mix at 11 per cent; are not legally sustainable. The honourable Supreme Court in Kerala Financial Corporation v. Commissioner of Income-tax reported in [1994] 210 ITR 129(1), has held that impugned revi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manding the sales tax at 16 per cent, based on the subsequent circular issued by the first respondent and therefore, on account of the pre-conclusion by the superior authority, namely the first respondent, there cannot be any efficacious alternative remedy and hence, we are of the considered view that the writ petitions are legally maintainable. It is not in dispute that the sales tax is an indirect tax and the assessment for the year 2002-03 was completed as early as October, 2003. The second respondent, by his order, dated March 4, 2005 has claimed sales tax at 16 per cent for the aforesaid items for the period 2002-03. The Division Bench of this court in the decision, P.A.S. Industries v. Commissioner of Commercial Taxes, Chepauk, Chennai reported in [2007] 6 VST 671 (Mad), has held as follows (page 674): The point involved in this petition is no more res integra. The Supreme Court in State Bank of Travancore v. Commissioner of Income-tax [1986] 158 ITR 102, held that even though the clarifications issued by the Revenue being executive in character cannot alter the provisions of the Act and since they are in the nature of concessions, they can always be prospectively ..... X X X X Extracts X X X X X X X X Extracts X X X X
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