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TMI Blog2019 (9) TMI 700X X X X Extracts X X X X X X X X Extracts X X X X ..... ral Sales Tax Act, 1956 and also from final assessment orders for A.Ys. 2002-03 to 2007-08 (U.P. and Central). 2. Since the points involved in all revisions are common or interrelated, the present revisions are being decided by a common order wherein facts of Sales/Trade Tax Revision No. 1068 of 2008 [arising from provisional assessment proceedings for October, 2007 (U.P.)] and Sales/Trade Tax Revision No. 188 of 2010 [arising from final assessment proceedings for A.Y. 2005-06 (U.P.)] are being taken note of. Also, the revisions filed against provisional assessment orders are being considered since the findings recorded and material relied overlap in the two proceedings of provisional and final assessment. 3. Sales/Trade Tax Revision No. 1068 of 2008 has been filed by the assessee against the order of the Commercial Tax Tribunal, Moradabad dated 02.08.2008 passed in Second Appeal No.256 of 2008. By that order, the Tribunal has dismissed the appeal filed by the assessee and held that the Department of Agriculture, Government of U.P. had not issued any guidelines whether tax may be imposed on the contents of Sulphur in Single Super Phosphate (SSP) under the exemption notification N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e question involved is purely legal with respect to the taxability and availability of exemption under the relevant notifications, the revisions arising from final assessment proceedings have been heard on merits on the followings questions of law:- "(i) Whether, there being no prescribed percentage of Sulphur (as S) as mentioned in the Control Order being present in SSP and the Phosphatic component of the Single Super Phosphate being exempt under notification No.440 dated 12.2.2001 and the other constituent Gypsum (for agriculture use) being exempt from payment of tax under notification No.784 dated 31.3.1995, the order of the Commercial Tax Tribunal upholding the taxability on estimated percentage of Sulphur is legally sustainable? (ii) Whether, in view of the letter of the Directorate of Agriculture, having specified that Sulphur is present in the form of Gypsum in Single Super Phosphate manufactured by the applicant, and Gypsum for agricultural use being exempt under the notification No.784 dated 31.03.1995, the Commercial Tax Tribunal was legally justified in upholding the levy of tax on assumed percentage of Sulphur components? (iii) Whether, there being no guidelines i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1)/91-U.P. Act-XV/48-Order-91, dated August 30, 1991, the Governor is pleased to direct that, with effect from April 1, 1995, no tax under the said Act No. XV of 1948 shall be payable on sale of Gypsum (IS Code 6046) and Pyrite for agricultural use." 10. Next reference has been made to a letter dated 17.05.2008 issued by the Director of Agriculture, Uttar Pradesh to the assessee stating that the presence of Sulphur in Single Super Phosphate (SSP) occurs as a result of following chemical reaction : Ca3(PO4)2 Tri Calcium Phosphate + 2H2SO4 Sulphuric Acid + 4H2O Water = CaH4(PO4)2 Mono Calcium Phosphate + 2CaSO4.2H2O Gypsum 11. It has been further specified in that letter that the chemical formula for Gypsum is CaSO4.2H2O. 12. Reference has also been made to a letter dated 15.02.2008 written by the Assessing Authority of the assessee to the District Agriculture Officer making enquiries whether in the computation of the control price of Single Super Phosphate (SSP) there was any component of any commodity other than Single Super Phosphate (SSP). It appears the Department of Agriculture, Uttar Pradesh vide letter dated 22.12.2008 stated (with reference to the letter dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame. Then, referring to Gypsum (CaSO4.2H2O), it has been submitted that in any case, Gypsum (CaSO4.2H2O) for agriculture use was clearly exempt under the pre-existing exemption notification No. 784 dated 31.03.1995. Therefore, the fact that the Sulphur was contained in Gypsum (CaSO4.2H2O) would be wholly irrelevant and extraneous to the issue. 17. In any case, it has been submitted, in absence of any percentage being specified by the Department of Agriculture, Uttar Pradesh, as to the component of the Single Super Phosphate (SSP), that may be treated to be exempt, it was not open to the revenue authorities to carry out an independent exercise to discover what part of Single Super Phosphate (SSP) contained Sulphur. In absence of guidelines being issued by the Department of Agriculture, Uttar Pradesh, which was only an expert body recognized under the notification No. 440 dated 12.2.2001, the entire quantity of Single Super Phosphate (SSP) would remain exempt and no artificial process or reasoning could be adopted to declare any part of value of that commodity to be not exempt or taxable. 18. In that context, it has also been submitted, in any case, it was never open to the revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... posed must be found existing before a valid levy may arise. Any uncertainty or vagueness, either as to the character of the imposition, or to the person on whom the levy has been imposed or as to the rate on which the tax has been imposed or as to the measure or the value on which the rate is to be applied, would be fatal to the levy. In the instant case, besides other, there is no measure or value specified under the statutory scheme that may permit the revenue authorities to carry out any independent exercise to determine the value of content of Sulphur in the Single Super Phosphate (SSP), manufactured and sold by the assessee. Therefore, the exercise carried out by the revenue authorities in that regard, is without jurisdiction, presumptuous and in any case, wholly impermissible for the context of the taxing statute. 22. Reliance has also been placed on the decision of the Supreme Court in the case of C.I.T. Bangalore Vs. B.C. Srinivasa Setty, 1981 2 SCC 460, wherein it has been held that the charging section and computation provisions together constitute an integrated code and thus in absence of charging section providing or allowing the revenue authorities to search out the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the communication issued by the Department of Agriculture, (as has also been referred to by learned counsel for the applicant-assessee), to submit that the prescription made by the Central Government is wholly corroborated by the communication issued by the Department of Agriculture, Uttar Pradesh, inasmuch as the Sulphur is clearly mentioned as an ingredient of Single Super Phosphate (SSP) manufactured by the assessee. 27. Further, learned Standing Counsel would submit, there is no case set up by the assessee that it sold Gypsum (CaSO4.2H2O) and, therefore, the Tribunal has not erred in rejecting the claim set up by the assessee. 28. Having heard learned counsel for the parties and having perused the record, in the first place, it is to be seen whether the commodity Single Super Phosphate (SSP) was granted exemption. Second, it would have to be examined if such exemption existed whether any exception was created by law so as to exclude from exemption and thus subject to tax any part of the value of such Single Super Phosphate (SSP). If such exception is found to be existing in law, it would have to be further seen whether any tax liability existed on such excepted component ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ates and (minimum) Sulphur that may be present in Single Super Phosphate (SSP). It does not satisfy the requirement of the exemption notification No. 440 dated 12.2.2001 and it does not bring out the total percentage of Phosphatic component in Single Super Phosphate. It does not even attempt to identify the Phosphatic component in Single Super Phosphate as an ingredient. 33. Even otherwise if the argument advanced by learned Standing Counsel were to be accepted to any extent, it may have no impact as in face of other undisputed evidence in the shape of certification letters issued by the Department of Agriculture, Uttar Pradesh, Sulphur is present in Single Super Phosphate (SSP) only as Calcium Sulphate i.e. Gypsum (CaSO4.2H2O) and not as Sulphur in its elementary form. Though no percentage of the Phosphatic component in Single Super Phosphate (SSP) had been identified yet, it was made plain that other than Phosphatic component, Single Super Phosphate (SSP) contained Gypsum. Undisputedly, Gypsum (CaSO4.2H2O) by itself was made exempt by the State legislature under a separate notification No. 784 dated 31.3.1995. Gypsum having been identified as an item by the taxing statute, readi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear legal position that emerges is, de hors notification No. 784 dated 31.3.1995, it may have been permissible to the revenue authorities to tax the value of Gypsum (CaSO4.2H2O) [as Gypsum is a non-Phosphatic component of Single Super Phosphate (SSP)] if such guidelines had been found existing. However, in absence of such exclusionary clause in that notification, it is not permissible for the revenue authorities to break the identity of Gypsum (CaSO4.2H2O) so as to determine the percentage value of Sulphur in Gypsum (CaSO4.2H2O) only with the object of imposing tax on the value of Sulphur. 33. In view and in terms of the above, the questions of law (as framed above), are answered in the negative i.e. in favour of the applicantassessee and against the revenue, in Sales/Trade Tax Revision Nos. 178 of 2010, 179 of 2010, 180 of 2010, 188 of 2010, 189 of 2010, 190 of 2010, 191 of 2010, 192 of 2010, 242 of 2010, 243 of 2010, 244 of 2010 & 245 of 2010. Those revisions are accordingly allowed. The other revisions being Sales/Trade Tax Revision Nos. 1051 of 2008, 1052 of 2008, 1067 of 2008, 1064 of 2008, 1059 of 2008, 1070 of 2008, 1056 of 2008, 1069 of 2008, 1066 of 2008, 1060 of 2008, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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