TMI Blog2014 (2) TMI 1258X X X X Extracts X X X X X X X X Extracts X X X X ..... vidual as to the consequence of transactions forming part of his daily affairs, and, therefore, the need for a clear and consistent enunciation of legal principle in the decisions of a court. Entry 11 defines what a chemical fertilizer is and what a chemical fertilizer mixture is. Both are distinct entries and so understood, as such exemption was granted only to chemical fertilizer. This benefit was not extended to chemical fertilizer mixture. Therefore, when the Legislature made a distinction between chemical fertilizer and chemical fertilizer mixture from the inception, a notification exempting from payment of turnover tax on chemical fertilizer cannot be extended to chemical fertilizer mixture. If that is done by the interpretation process, the court would be adding to the notification which the Legislature and the Government did not intend to. The courts have no power to legislate, to add or to remove from the notification issued by the Government. When the Government notification specifically refers to the chemical fertilizer, there is no scope for interpretation also. In that view of the matter, we do not see any substance in the said contention. In fact, in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... came to be dismissed. It is against the said order, the assessee preferred an appeal before the Karnataka Appellate Tribunal. 4. The Tribunal after noticing that, while delivering the judgment in Pali Chemical Industries case [2008] 11 VST 926 (Karn); [2005] 58 KLJ 54, the decision in State of Karnataka v. Kothari Industrial Corporation reported in [2001] 121 STC 196 (Karn); [2000-01] 5 K.C.T.J. 193 was not noticed or brought before the honourable High Court by the parties concerned in Pali Chemical Industries' case [2008] 11 VST 926 (Karn); [2005] 58 KLJ 54, held that the judgment in Pali Chemical Industries' case [2008] 11 VST 926 (Karn); [2005] 58 KLJ 54 cannot be considered as a binding precedent. The Tribunal has gone on to observe that, since the lower authority passed orders relying only on the decision in Pali Chemical Industries' case [2008] 11 VST 926 (Karn); [2005] 58 KLJ 54, it is at liberty to come to a conclusion contrary to the one arrived at by the lower authority if the facts and circumstances of the case required so, by virtue of the order dated July 19, 2006 of the Division Bench in W. A. No. 3025 of 2005 (Deccan Sales Corporation Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. Before going to the merits of the case, we would like to place on record that we are very much disturbed by the tendency exhibited by the lower authorities in refusing to follow the law laid down by this court saying that the same is not binding on them merely because other binding precedents are not taken into consideration in those judgments. It appears that the Tribunal has assumed the power to declare the judgment of the Division Bench of this court as per incuriam and thereby refused to follow the judgment. The justification for such a course of action is that it is permitted to do so by another Division Bench. If this tendency is not nipped in the bud, we are afraid that there will be total lawlessness especially in the branch of taxation law. 8. In Pali Chemical Industries' case [2008] 11 VST 926 (Karn); [2005] 58 KLJ 54, interpretation of the very notification which is the subject-matter of these proceedings, was involved and the question that arose for the consideration of a Division Bench of this court was, whether the State Government has exempted only chemical fertilizers from the levy of turnover tax effected by second or subsequent dealer and no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntion is to levy single point tax on chemical fertilizers and chemical fertilizer mixtures. Therefore, the Legislature under entry 11(ii) of the Schedule to the Act intends to levy tax on chemical fertilizer mixtures on such of the components, which have not already suffered tax. Thirdly, even in common parlance and also in commercial parlance, the expressions 'chemical fertilizers' and 'chemical fertilizer mixtures' are understood as different commercial commodities. 11. What is a chemical fertilizer mixture did come up for consideration before the Division Bench of this court in Shaw Wallace Co. Ltd. v. State of Karnataka [1993] 91 STC 45 (Karn); [1992] 36 Kar LJ 478. In the said decision, the court had an occasion to notice how a chemical fertilizer mixture is prepared in the market. The court has observed that: 'In the preparation of chemical fertilizer mixtures the petitioner has to necessarily had a few other articles such as leather meal, neem cake meal, gypsum, etc. However, the ultimate product that is obtained out of mixing all these with leather meal, neem cake meal, gypsum, etc., would be a chemical fertilizer mixture.' 12. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1981, the turn over tax payable under section 6B of the said Act by registered dealers, on the second and subsequent sales of the following goods in the State, namely:- (i) Chemical fertilizers bone-meal and oil cake, and (ii) Insecticides and pesticides'. 15. The analysis of the aforesaid notification is as under: The notification is issued by the State Government in exercise of its powers conferred under section 8A of the Act. The exemption is with effect from July 1, 1981 and being continued from time to time. What is exempted under the notification is the turnover tax payable under section 6B of the Act by a registered dealer on his second and subsequent sales of chemical fertilizers. 16. The expressions in an exemption notification should be under- stood by the language employed therein. The benefit of the notification can be extended to a dealer, if he falls squarely within the four corners of the notification. 17. Keeping in view the object of the notification, the language employed in the notification and the specific entries in entry 11 of the Second Schedule to the Act, in our opinion, the State Government while issuing notification has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... honourable the Chief Justice to enable him to constitute a Larger Bench to examine the question. That is the proper and traditional way to deal with such matter. It is founded on healthy principles of judicial decorum and propriety; certainty is a thing that is absolutely necessary in law than any other thing. That quality would totally disappear if Judges of co-ordinate jurisdiction in a High Court start overruling one another's decision. If one Division Bench of the High Court is unable to distinguish an earlier decision of another Division Bench, and holding that the view of the earlier decision is wrong, the same would result in utter confusion. In such a case, lawyers would not know how to advice their clients and all courts subordinate to the High Court would find themselves in an embarrassing position of having to choose between such judgments. 11. When an appeal is not entertained on the ground of availability of an alternative and efficacious remedy, the Division Bench cannot observe that the earlier judgment may not be correct and then call upon the appellate authority to decide the case on merits ignoring a binding decision of the Division Bench. What ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chance litigation. It must be remembered that practicability and certainty is a hallmark of the judicial juris- prudence developed in the country in the last six decades. In our constitutional set up, every citizen has a duty to abide by the Constitution and respect its ideals and the institution. Those who are entrusted with the task of administering the system and operating various constituents of the State, having taken oath to act in accordance with the Constitution and uphold the same, should set an example by exhibiting total commitment to the Constitutional ideals. This principle is required to be observed with greater rigour by the members of judicial fraternity who are bestowed with the power to adjudicate upon important constitutional and legal issues and protect and preserve rights of the individuals and society as a whole. 15. Discipline is sine qua non for effective and efficient functioning of the judicial system. If the courts command others to act in accordance with the provisions of the Constitution and rule of law, it is not possible to countenance violation of the constitutional principle by those who are required to lay down the law. Therefore, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Bench held that, when the notification was issued on June 29, 1981, entry 117 in the Second Schedule included copper sulphate insofar as the expression insecticide/pesticide was concerned. It is only subsequently, the same underwent change making it clear that insecticide/pesticide excluded copper sulphate. Copper sulphate does not go out of the category of insecticide/pesticide, but for the purpose of the Second Schedule the same should be dealt with separately. Therefore that treatment cannot be applied to the said expression when it occurs elsewhere. When the authority granting exemption itself understood that the copper sulphate is included in the expression insecticide/pesticide , the only question to be considered by the authorities is whether copper sulphate is insecticide/pesticide. That question has been considered by the appellate authority in these cases by reference to a statute, viz., Insecticides Act, 1969 and Insecticides Rules, 1971, and that certainly forms an excellent piece of evidence to indicate whether copper sulphate is insecticide/pesticide. When the Legislature itself recognises such a fact, it is certainly proper for the authorities to rely ..... X X X X Extracts X X X X X X X X Extracts X X X X
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