LexCOMMISSIONER OF TRADE TAX, U.P. versus M/S. NATIONAL INDUSTRIAL CORPORATION LTD.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
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[2008] HS S.C.R. 1026
COMMISSIONER OF TRADE TAX, U.P.
v.
MIS. NATIONAL INDUSTRIAL CORPpRATIGN LTD.
(Civil Appeal Nos. 6938-6939 of 2008 etc.)
DECEMBER 02, 2998
[S.B. SINHA AND CYRIAC JO~f:P,H 1 JJ~l
Uttar Pradesh Treg~ Tax Act, 1948 -
~'~and 30 - Levy
of sales tax - o,, 'P~dciy Hus!<' ...,. Assessee using 'P;:tdqy
C husk' in manufactvririg µnits -- Assessm~nt in terms of various
Notifications issued since 7,9.1981 -- Notification dated
6. 6. 1996 for the first time Including 'Paddy husk' -- Assessee
claimed to be assessed only w.e.f. 6.6.1996 - Revenue
contending that assessment in respect of 'Paddy husk' 90L{tg
D be done even prior to 6.6.1996 as 'Rice H,psk' \41~§ ((able ta
be taxed by earlier Notific.at(ons as 'Rice husk' and 'Paddy
husk' are the same commodity- Held: 'Paddy husk' and 'Rice
husk' are not the same commodity -- Tax was liab!fJ (Q b.~
levied an '.P,addy busk~ /;Jy reason of Notific?.t(o.n. 4@~?-€1
E 6. 6. 1996 and not prior to that.
Taxation -- Levy of tax,,,. Held: Levy of tax is permissible
having regard to provi$ions contained in Article 265 of the
Constitution and in terms of statute - Power to impose tax
must be express -- No equity can be claimed in such matter
F -- Notification imposing fiscal liability not to be imposed by
way of clarification or otherwise -- Benefit of ambiguity in the
Notification to go to the assessee -- Constitution of India, 1 ~§Q
-- Article 265.
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Words and Phrases - 'hus.({ -- Meanfn,g Qt, in t-he qontext
of Uttar Pradesh Trad{3 "fa>J Act,, 1948 .
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Respgnc::t@ot~ Y§~ 'J?,iddY H4$,k' iU~ fuel in their
manufaetyring units. They were assessed for payment of
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COMMISSIONER OF TRADE TAX, U.P. v. M/S. NATIONAL 1027
INDUSTRIAL CORPORATION LTD.
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sales tax in terms of various Notifications issued u/s 30
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of Uttar Pradesh Trade Tax Act, 1948. The respondent·
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assessee questioned the levey of the tax on the ground
that as the paddy husk was included for the first time in
the Notification dated 6.6.1996, the tax was leviabl~
thereon by reason of that Notification ahd not prior B
thereto .. Ftevenue stated tliat as 'Paddy husk' and 'Rice
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husk' are the same commodities ,therefore, 'Paddy husk'
must be deemed to have been notified for the purpose
of levy of sales tax from the very beginning. Trade Tax
fribunal, by majority helci that both are different c
commodities. High Court confirmed the majority view of
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the tribunal. Hence, the present appeals.
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Dismissing the appeals, the Court
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HELD: 1.1. A notification imposing any fiscal liabililV
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cannot be imposed upon a dealer by way of clarification
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or otherwise. A tax must be levied having regard to the
,.,
provisions contained in Article 265 of the Constitution of
India, i.e., by authority of law. The power to impose ta)(
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must be express and no equity can be claimed in the
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matter of levy of tax. One has to look merely at what is
clearly stated in the statute. Imposition of tax is
permissible only in terms of the provisions of statute.
Reasonable taxation is a part of the doctrine of good
governance. If a.n entry contained in a Notification
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imposing tax is ambiguous, the assessee cannot suffer
therefor. In the instant case, no attempt was made by the
State to clearly state that rice husk is synonymous to
paddy husk. It was necessary in view of the fact that
admittedly paddy and rice are different commodities. It G
has been stated in High Court judgments that nothing is
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known as rice husk, however, opined that rice polish and
rice brown are the same thing. [Para 10] [1038-C-E; 1039-
D-H]
1.2. As paddy and rice are considered to be the
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1028
SUPREME COURT REPORTS
[2008] 16 S.C.R.
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A separate C()mmodities, .Paddy husk cannot be treated to
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be rice. husk .. Not ~nly in th,e notificatiO_n dated 7.9.1981
but a1$0 in tlie notitication dated 5;6.1985 'paddy husk'
is not mentlohed. Sy reason of Notification dated 6.6.1996
'paddy husk' was inserted. E;ven then; ttie· 'rice husk' was
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B not deleted. No explanation was offered· therefor; Both:
'rice husk' and· ipaddy·~usk' thus, found place:in the
Notificatio·n. Therefore; 'paddy husk' was subjected to for
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the first time by reason 6f the said notification dated
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6.6.1996. Yet again; while giving a purported riew look to
c the entry, in the notification dated 15.1.2000, the words Excerpt shown. Read the full judgment & AI analysis in Lexace.