TMI Blog2016 (1) TMI 1217X X X X Extracts X X X X X X X X Extracts X X X X ..... third parties but has been stock transferred to their own cement units. The Petitioners are therefore held entitled to restitution. The 15% additional entry tax is directed to be refunded to the Petitioners - petition allowed - decided partly in favor of petitioner. - Writ Petition (T) Nos. 3859, 4218, 4823 of 2010, Writ Petition (T) Nos. 6724 of 2011, Writ Petition (T) Nos. 141, 142, 156, 174 of 2014 - - - Dated:- 19-1-2016 - Navin Sinha and P. Sam Koshy, JJ. Shashank Dubey, Senior Advocate along with Bhaskar Pyasi, Siddharth Dubey, Ashish Shrivastava along with Somya Rai and Raja Sharma for the petitioners. Prafull N. Bharat, Additional Advocate General, for the respondents. JUDGMENT The Petitioners are Cement Companies having leased mines for quarrying limestone. The limestone is converted into clinker at their clinkerisation units. Clinker is then stock transferred by them to their respective units outside the State for manufacture of cement. 2. The Petitioners challenge the imposition of a higher rate of entry tax on limestone when it is clinkerised in the local area but is stock transferred to their units outside the State to the extent it is used fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch local area. A different rate of higher tax could be imposed on limestone entering the specified local area and used for manufacture of clinker. But it was impermissible to impose differential rates of entry tax on clinker based on the nature of the end user of the goods manufactured. The State having once resolved to fix the rate of entry tax on limestone capable of being used for manufacture of clinker in such local area at 10% it cannot make a sub classification with regard to such goods merely because after such production the goods were stock transferred outside the State. There was no rationale or nexus for this sub-classification. 7. The amendments to the notification dated 29.9.1997 are not in consonance with Section 9 of the Act which provides for gazette publication of amendments to Schedules II and III of the Act. There is no denial to this specific assertion made in Writ Petition (T) No.3859/2010 (Ambuja Cements Limited vs. State of Chhattisgarh Ors), Writ Petition No.4218/2010 (A.C.C Ltd vs. State of Chhattisgarh Ors), Writ Petition (T) No.141/2014 (A.C.C Ltd. vs. State of Chhattisgarh Ors) and Writ Petition (T) No.142/2014 (Ambuja Cements Limited vs. State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as deprived of 15% sales tax and to make up that deficit, the entry tax was enhanced to that extent on such amount of clinker as was stock transferred outside the State for manufacture of cement. 11. We have considered the respective submissions on behalf of the parties and are satisfied that the writ petitions deserves to be allowed for reasons to be discussed hereinafter. 12. The fact that entry tax is compensatory in nature need not detain the discussion in view of the settled law and acknowledgement by the State in its counter affidavit with regard to its character as it was being utilized for the benefit of the public by investing the revenue generated for the convenience of the people of the State by constructing road works, street lights and providing irrigation to the farmers etc. The parties are ad idem on the issue and it need not be discussed any further. 13. Entry 52 List II to the VIIth Schedule of the Constitution vests power in the State to frame laws with regard to taxes on the entry of goods into a local area for consumption, use or sale therein. Item 54 vests power in the State to levy tax on sale or purchase of goods other than newspaper and subject to E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f entry tax in specified local areas on specified goods used, consumed or sold in such local area for manufacture of other goods. In other words if the goods entering a specified local area are not used, sold or consumed in such area in the form in which they entered but are used for manufacture of other goods in such local area it shall attract a higher rate of tax. Entry tax in such case could be charged on the taxable quantum at a rate not exceeding 50%. On a plain reading a higher rate of tax could be imposed based on the nature of the product manufactured from the goods entering the local area. Once the nature of the product manufactured is made the basis of tax it has to be applied uniformly and there can be no further imposition based on the nature of the end user of the goods so manufactured. With regard to the limits of authority for levying tax under a taxing statute it was observed in (1971) 2 SCC 741 (CGT. N.S.Ghetti Chettiar) as follows :- 19 .In interpreting tax laws. Courts merely look at the words of the section. If a case clearly comes within the section, the subject is taxed and not otherwise. 16. Section 6 provides that entry tax shall not be payable unl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... servation in (2010) 14 SCC 751 (CCE v. Doaba Steel Rolling Mills as follows :- 26. On the principles of interpretation of taxing statutes, the following passage from the opinion of late Rowlatt, J. in Cape Brandy Syndicate v. IRC has become the locus classicus and has been quoted with approval in a number of decisions of this Court: (KB p. 71) in a taxing Act one has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. One can only look fairly at the language used. 19. The submission on behalf of the Petitioners that the procedure under Section 9(2) of the Act has not been followed by proper Gazette notification while issuing the amendments to the notification merits no consideration for the simple reason that there is no amendment by either addition or deletion of the item limestone mentioned in Schedule II. 20. The Respondents by purporting to enhance entry tax on limestone if stock transferred outside the State after clinkerisation were essentially seeking to compensate themselves for loss of revenue from sale of cement ..... X X X X Extracts X X X X X X X X Extracts X X X X
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