LexNATIONAL CO. LTD. CALCUTTA versus DEPUTY DIRECTOR OF TAX CREDIT (EXPORTS) CALCUTTA & ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
NATIONAL CO. LTD. CALCUTTA
v.
DEPUTY DIRECTOR OF TAX CREDIT (EXPORTS)
CALCUTTA & ORS.
March 3, 1977
[P. N. BHAGWATI AND S. MURTAZA FAZAL ALI, JJ.J
125
Tax Credit Ce1·tificate (Exports) Schenie 1965-Scheme providing for cer-
.tain categories of goods or 1nerchandise specified in column 2 whiclz
were
f'X]>orted after 28-2-1965 to destinations specified in colun1n 4--Scherne a111c11d-
ed· by Notification dated 6-6-1966 disentitling an exporter to tdx credit certi-
ficate in respect of goods or n1erc/landise exported and the sale proceeds there-
for were receii·ed after 5-6-1966-Second Notification amending the first one
providing for grant of tax credit ci?rtificate in respect of goods exported on or
before 5-6-1966 even if the sale proceeds WPre received thereafter-H,.het!1er
the Notifications ultra vires the powers of the Central Government vested under
~. 280 ZE read with 280 ZC of the lnconze Tax Act.
The jute carpet 'backing cloth manufactured by the appellant in its , jute
mills and exported was covered by Item 1 in column 2 which specified "goods
made of jute not otherwise specified" of the Table appended to the Tax Credit
Certificate (Exports) Scheme, 1965. The notification issued by the Central
Government in exercise of the
powers vested under s.
280ZE read
with
S. 280ZC, dated 6-6-1966 and 8-8-1966, provided that no tax credit certificnte
shall be issued in respect of any goods exported after· 5-6-1966. The appel-
lant, who exported diverse quantities of jute carpet backing cloth .manufactured
by it to various countries during the period 13-7-1966 and 30-11-1966, filed
a writ petition in the Calcutta High Court for a writ of niandarnus for
quashing and setting aside both the
Notifications and directing
the Central
{]overnment to consider the application of the applicant for tax credit certi-
ficate in respect of the exports without taking into account the t\-vo Notifica-
tions.
The ground of challenge was that the twO Notificatioris \Vere outside.
the powers conferred on the Central Government u/ s 280ZE read with S. 280
ZC, since the Central Government had no power under those sections to make
11 scheme providing that no tax credit certificate shall be granted in case of
any goods or merchandise at all. The single Judge granted mandan1us. hot
the Division Bench on appeal took a different view and negatived the challenge.
Dismissing the appeal by certificate the Court,
HELD : (i) The Division Bench of the High Court was right in holdlng
that the Central Government was entitled to issue the two Notifications direct-
ing that no tax credit certificates sha11 be granted
in
respect of goods
or
merchandise exported on or after 5-6-1966. [131 A·B]
(ii) No obligation can be spelt out from Ss. 280 ZC and 280 ZE re.:iuiring
the Central Government to frame a scheme specifying the goods or merchandise
in respect of which tax credit certificate shall be granted. The Central Govern~
ment was entitled to say that having regard to the factors set out in sub-
section (3) of S. 280 ZC, it does not think it desirable that ,tax credit c.:rti·
ficate should be granted in respect of any goods or merchandISe for the tune
being.
[130 F·HJ
C!v1L APPELLATE JURISDICTION: Civil Appeal No. 950 r:i 1972.
(From the Judgment and Order dated the 5-7-1971 of the Calcutta
High Court in Appeal No. 130/71) _
N. R. Khaitan, A. T. Patra and Pravee11 Kumar, for the appellant.
A
B
c
D
E
F
G
H
12 6
SUPREME COURT REPORTS
(1977] 3 S.C.R.
A
Lal Narain Sinha, Sol. General, S. N. Prasad and Girish Clwndra
B
c
D
E
F
G
H
not present for respondents.
The Judgment of the Court was delivered by
BllAGWATI, J. The appellant.owns a jute mill situate at Rajgunj,
Railway Station Andul, District Howrah in the State of West Bengal
and among other jute .products, it manufactures jute . carpet backing
cloth at its jute mill. 'fhc appellant exported diverse quantities m jut~
carpet backing cloth manufactured· by it to various countrie:; during
the period 13th July 1966 to 30th November 1966.
There was a Tax
Credit certificate Scheme framed by the Central Government under
Section 280 ZE read with Section 200 ZC of the Income Tux Act
l 962.
The Scheme was called the Tax cr,dit Certificate (Exports)
Scheme 1965. The Scheme provided for grant of Tax Credit Certifi-
cate in respect of certain categories of goods or merchandise specified
in column 2 which wero exported to destinations specExcerpt shown. Read the full judgment & AI analysis in Lexace.