Punjab-Haryana High Court
State Of Punjab And Ors. vs Milkhi Ram Oil And Dall Mills on 21 August, 1997
Equivalent citations: (1998)118PLR103
JUDGMENT N.K. Kapoor, J.
1. This judgment shall dispose of Letters Patent Appeal Nos. 75, 88, 89, 91 to 97 and 569 of 1992 as well as Civil Writ Petitions Nos. 6663 of 1989, 6343 and 6345 of 1993, 13719, 13720, 15200 and 15206 of 1994 and 12611 of 1995 as the question of law raised in the aforesaid appeal/writ petitions is identical. Reference to the facts is made to the averments made by the petitioner in C.W.P. No. 6919 of 1987 allowed by the learned single Judge vide judgment dated July 18, 1991 Reported in [1992] 84 STC 206 (P&H) (Milkhi Ram Oil & Dall Mills v. Slate of Punjab)leading to its challenge in appeal. Before adverting to the facts, it may be mentioned that in C.W.P. No. 6919 of 1987 challenge is to the order of the Presiding Officer, Sales Tax Tribunal, under Section 21(3) of the Punjab General Sales Tax Act, 1948 (for short, "the Act") as well as to the order passed by the Assistant Excise and Taxation Commissioner invoking his suo motu powers under Section 21(1) of the Act, whereas in the other L.P.As., the petitioners approached this Court on the basis of show cause notice issued as to why the assessment be not revised. Similarly, writ petitioners in the aforesaid writ petitions have straightaway come to this Court to challenge the order of the Assessing Authority whereby the Assessing Authority has assessed the inter-State sale of washed cotton seed oil at the rate of 4 per cent instead of 1 per cent, i.e., no remedy by way of appeal or revision has been availed of by the petitioners. These writ petitions were admitted and ordered to be heard along with L.P.A. No. 75 of 1992.
2. Milkhi Ram Oil & Dall Mills--writ petitioners--sought a writ of certiorari, mandamus or any other suitable writ or direction quashing annexures P-4 and P-5, same being against the provisions of law and without jurisdiction. It is the case of the petitioner that he filed quarterly returns for the years 1981-82, 1982-83 and 1983-84 within time and deposited the tax thereof. Earlier, interstate sales tax on the sale of cotton seed oil and other seed oil was 4 per cent but the State of Punjab vide notification dated January 11, 1979 reduced the same to 1 per cent. It is on the basis of aforesaid notification that assessment of the petitioner for the assessment years 1981-82, 1982-83 and 1983-84 was completed and sales tax was charged at the rate of 1 per cent on inter-State sales made as per notification. According to the petitioner, the Assessing Authority after verification treated the sale of edible oil by the petitioner as covered by notification. Despite the matter having become final, petitioner received notice in respect of the aforesaid assessment issued by the Assistant Excise and Taxation Commissioner under Section 21(1) of the Act stating therein that the assessment made need to be reopened as the tax leviable on the sale of these articles, in fact, ought to have been 4 per cent and not 1 per cent as assessed by the Assessing Authority. According to the petitioner, the Assistant Excise and Taxation Commissioner exercising suo motu powers passed an ex parte order holding that tax leviable on the sale of cotton seed oil is 4 per cent instead of 1 per cent. The Assistant Excise and Taxation Commissioner has held that as the dealer was required to pay tax due along with return which he has failed to do so, the petitioner is liable to pay interest upon the amount in terms of Section 9(2) of the Central Sales Tax Act, 1956. Accordingly, a demand for the amount of tax and interest for all the three aforesaid years was raised, i.e.. total amount to be recovered as Rs. 1,05,887. No penalty was levied. Feeling aggrieved by the order passed by the Assistant Excise and Taxation Commissioner dated November 24, 1986, the petitioner preferred an application before the Sales Tax Tribunal in terms of Section 21(3) of the Act. The Tribunal vide order dated August 5, 1987 found no reason to upset the orders of the Assistant Excise and Taxation Commissioner dated November 24, 1986 and so dismissed the revision application. The petitioner did not avail of the remedy provided under Section 22 of the Act and chose to approach this Court by way of this petition stating that point involved is pure question of law and no useful purpose would be served by exhausting the remedy provided under the Act.
3. Resisting the petition, respondents took few preliminary objections as well as replied/controverted other averments made in the petition. By way of preliminary objection, respondents raised bar of an alternative remedy by referring to Section 22(1) of the Act. Secondly, the point urged by the petitioner is, in fact, a pure question of fact, i.e., whether cotton seed oil is edible or non-edible. The respondents placed reliance upon the view taken by the Hyderabad High Court in case reported as Kishenlal Oil Mills [1955] 6 STC 650 and other judicial pronouncements.
4. The writ petition was admitted and finally decided vide the impugned judgment.
5. Challenging the judgment of the learned single Judge, learned Advocate-General, Punjab, argued that the court has misconstrued the point of law. In fact, writ court cannot go into the question of fact as to whether cotton seed oil is an edible oil or not ? The counsel further argued that admittedly there exists an alternative remedy under Section 22(1) of the Act and thus extraordinary remedy under Article 226 of the Constitution of India could not be availed by the petitioner. The learned single Judge erred in examining the matter afresh on the point of fact which, in fact, has attained finality in view of the affirmation of the order of Assistant Excise and Taxation Commissioner by the Tribunal. The Tribunal having finally determined the question of law, same could not be a matter of fresh appraisal by this Court. Whether cotton seed oil per se is edible or not, counsel placed reliance upon the decision of the High Court of Hyderabad in Kishenlal Oil Mills case [1955] 6 STC 650. The counsel also took support from the view expressed by the apex Court in the case reported as Bharat General and Textile Industries Ltd. v. State of Maharashtra [1989] 72 STC 354 wherein the court held that "washed cotton seed oil" is not edible oil.
6. Supporting the judgment of the learned single Judge, learned Senior Advocate Mr. M.L. Sarin, argued that the assessment having been made by the Assessing Authority, same could not be ordered to be reopened by the Assistant Excise and Taxation Commissioner under Section 21(1) of the Act, especially after a long gap. The assessee at the outset disclosed the nature of transaction which was effected during the assessment period in dispute and the Assessing Authority on considering the return submitted by the assessee found the same to be in conformity with the provisions of the Punjab General Sales Tax Act, 1948 and thus held that as tax had been paid, there is no demand against the assessee. The counsel argued that no doubt the revisional authority has the power to recall the record of the proceedings which have been pending or disposed of by any authority subordinate to him, for the purpose of satisfying himself as to the legality or propriety of such proceedings and also has powers to pass such orders as he thinks fit ; yet these powers are to be exercised very sparingly. These are not intended to harass the assessee who promptly submitted the return and deposited the tax as per rates stipulated under the Act. It is not a case where the assessee withheld some information or misstated certain facts. According to the counsel, it was the stand of the assessee from inception that he sold "washed cotton seed oil" which is edible and thus liable to sales tax at the rate of 1 per cent as per Punjab Government notification. This way the Assistant Excise and Taxation Commissioner exercised the jurisdiction which did not vest in him. The Tribunal too did not choose to interfere with the order of the Assistant Excise and Taxation Commissioner and so with this background approaching the authorities to refer the question of law for an opinion of High Court was a mere formality. Precisely for this reason, the petitioner decided to assail the orders, annexures P-4 and P-5, by approaching the court under Article 226 of the Constitution of India. According to the counsel, as the precise dispute between the parties pertains to determining as to whether "washed cotton seed oil" is edible or not and that was indeed a core question, learned single Judge rightly chose to examine this question thread-bare and after making reference to the relevant provisions under the other Acts, notifications, etc., found substance in the plea of the petitioner that washed cotton seed oil will fall within the ambit of edible oil and thus accepted this petition. Examination by learned single Judge is purely based upon provisions contained in the Prevention of Food Adulteration Act, 1954 ; standard prescribed under the Agricultural Produce (Grading and Marking) Act, 1937 ; report of the National Chemical Laboratory and specifications prescribed by the Indian Standards Institution and so has evaluated the respective contentions raised by the parties. Thus, no enquiry on facts has been made by the learned single Judge. So the judgment impugned cannot be faulted nor such an approach can be termed to be unwarranted. In fact, it is only on determining the nature of the product sold that any assessment could be made under the Act.
7. The counsel further argued that bar of alternative remedy, now pressed at this stage by counsel for the appellant, is, in fact, wholly misplaced. Firstly, bar of alternative remedy is not an absolute bar. It is different matter that the court in the given circumstances relegate a party to its ordinary remedy. All the same, the court is not precluded from examining the legality or propriety of the orders impugned even if a statutory remedy has not been exhausted. The counsel placed reliance upon the decision in case reported as Shri Vallabh Glass Works Ltd. v. Union of India (1984) 3 SCC 362 (P&H), Ram and Shyam Company v. State of Haryana AIR 1985 SC 1147, Kuldeep Singh v. State of Punjab (1994) 2 RLR 470 (P&H) and Jindal Strips Limited v. State of Haryana [1996] 100 STC 457 (P&H).
8. Referring to the decision in Kishenlal Oil Mills case [1955] 6 STC 650 (AP), the counsel argued that in the aforesaid decision the court was considering as to whether cotton seed oil was edible oil as per provisions contained in the Hyderabad General Sales Tax Act. The court relying upon the report of the National Chemical Laboratory and the provisions of the Prevention of Food Adulteration Act and Rules, in fact, examined the matter by laying down certain stringent standards and thus held the cotton seed oil to be not meant for human consumption. However, there has been a significant change in this approach as reflected in the standards now prescribed. In fact, the Directorate of Marketing and Inspection has described the washed cotton seed oil, to be edible. Even the Central Government has defined "edible oil" meant any oil used for human consumption after processing. Since there is nothing to infer that the same docs not conform to the instructions issued by the Government in the year 1963, the authorities, indeed, erred in law in holding the product to be in the category of non-edible oil. Similarly, the counsel argued that reliance placed upon the decision in Bharat General and Textile Industries Ltd. case [1989] 72 STC 354 (SC) is wholly misplaced. The court in the aforesaid case was examining the notification exempting fully purchases of inputs and sales of finished goods of new units set up in backward areas. The court held the classification to be discriminatory. The court further held that withdrawal of such exemption only in relation to new units set up for manufacture of "edible oils" is not discriminatory. This precise point whether washed cotton seed oil is edible oil was not an issue and so the decision of the apex Court is distinguishable on facts.
9. Defending the action of some of the respondents who straightaway came to this Court challenging the show cause notices issued by the authorities, the counsel argued that the department had finally made up its mind, as noticed by the court in the case of Milkhi Ram Oil & Dall Mills, approaching them was in the nature of a formality and, in fact, no useful purpose would have been served except to prolong their agony. This Court in such like cases has interfered under writ jurisdiction and in suitable cases have even quashed the notices and subsequent proceedings. Reliance has been placed upon the decision in Jindal Strips Limited case [1996] 100 STC 457 (P&H).
10. Lastly, the counsel argued that the finding of the Assistant Excise and Taxation Commissioner of awarding of interest, indeed, is not sustainable. It is for the first time that the Assistant Excise and Taxation Commissioner held the tax to be levied at the rate of 4 per cent instead of 1 per cent and so imposition of interest is liable to be set aside.
11. We have heard learned counsel for a considerable time and perused the order passed by the Assistant Excise and Taxation Commissioner, order passed by the Tribunal, other material averments made in the writ petition, its reply and the judgment of the learned single Judge. Facts have been noticed above. Whether cotton seed oil per se is an edible oil and so leviable at the rate of 1 per cent for the purpose of sales tax assessment is the sole issue which was subject-matter of adjudication by the Assistant Excise and Taxation Commissioner and the Tribunal under the Punjab General Sales Tax Act, 1948, and examined too by this Court in the writ petition. The Assistant Excise and Taxation Commissioner exercised his suo motu powers under Section 21(1) of the Act with a view to determine the legality and propriety of the order passed by the Assessing Authority wherein the return filed by the assessee depositing the sales tax at the rate of 1 per cent on the inter-State sale of cotton seed oil was accepted. The Assistant Excise and Taxation Commissioner, prima facie found the order passed by the Assessing Authority to be suffering from illegality and impropriety regarding the rate of tax applicable and so called upon the assessee to come present and substantiate his contention, if any. As an opportunity of hearing was given to the assessee who came present before the Assistant Excise and Taxation Commissioner and sought a short adjournment. The case was thus adjourned and on the adjourned hearing it so happened that neither the assessee nor his counsel came present, so the authority chose to proceed ex parte. On considering the matter, the Assistant Excise and Taxation Commissioner held that the cotton seed oil sold by the assessee does not come within the purview of edible oil. To hold so, the Assistant Excise and Taxation Commissioner examined from all possible conceivable angle, i.e., nomenclature, consumability and edibility of the product, machinery, if any, set up by the assessee and other processes which this product had to undergo to make it edible. The Assistant Excise and Taxation Commissioner thus revised the assessment and so called upon the assessee to deposit the tax and the interest which has accrued thereupon. However, no penalty was levied. Aggrieved by the order of the Assistant Excise and Taxation Commissioner, separate applications were filed in respect of each assessment. The Tribunal, however, took up the matter together. During the course of hearing, it was put to the assessee as to whether even now they can adduce any proof to prove that the oil sold by them was an edible oil. At this their counsel sought time to place on record the analysis report from his buyers, namely, D.C.M. Limited and others. However, later on the counsel reported that as per information given by the buyers who stated that they are not in a position to give laboratory analysis of the oil sold by the dealer, the same cannot now be furnished. All the same, the Tribunal chose to examine in the light of available material on record and held that there is no evidence on record to infer that washed cotton seed oil is edible. The Tribunal consequently dismissed the applications.
12. The Punjab General Sales Tax Act, 1948, deals with the ambit of taxation authority, constitution of Tribunal, levy of taxes, assessment by the authorities, power of review, revision, etc. Assessment of tax is to be made by the Assessing Authority in the first instance. In case the Assessing Authority is not satisfied with the return furnished in respect of any period, he can require the production of evidence and thereafter determine the assessment. An aggrieved party has the remedy of appeal under Section 20 of the Act. under Section 21(1) of the Act, the Commissioner on his own motion can call for any record of the proceedings which are pending before or have been disposed of by any authority subordinate to him, for the purpose of satisfying himself as to the legality or propriety of such proceedings or order made therein. He is also authorised to pass any order in relation thereto as he may think fit. It is in the light of Section 21(1) of the Act that suo motu powers have been invoked to test the legality and propriety of the assessment order. In case, a person is still dissatisfied with the order passed under Section 21(1) of the Act, yet he can file an application in writing asking the Tribunal to refer to the High Court any question of law arising out of such order. The relevant provisions are contained in Section 22 of the Act which reads as under :
"22. Statement of case to High Court.--(1) Within 60 days from the passing of an order under Section 20 or 21 by Tribunal affecting any liability of any dealer to pay tax under this Act, such dealer or the Commissioner may, by application in writing accompanied by a fee of one hundred rupees in case the application is made by a dealer, require the Tribunal to refer to the High Court any question of law arising out of such order.
(2) If for reasons to be recorded in writing, the Tribunal refuses to make such reference, the applicant may, within 30 days of such refusal either--
(a) withdraw his application (and if he does so, the fee paid shall be refunded) ; or
(b) apply to the High Court against such refusal.
(3) If upon the receipts of an application under Clause (b) of Sub-section (2), the High Court is not satisfied of the correctness of the Tribunal's decision it may require the Tribunal to state the case and refer it, and on the receipt of such requisition the Tribunal shall state and refer the case accordingly.
(4) If the High Court is not satisfied that the statements in a case referred under this section are sufficient to enable it to determine the question raised thereby, it may refer the case back to the Tribunal to make such additions thereto or alterations therein as the court may direct in that behalf.
(5) The High Court upon the hearing of any such case shall decide the question of law raised thereby, and shall deliver its judgment thereon containing the grounds on which such decision is founded and shall send to the Tribunal, a copy of such judgment under the seal of the court and the signature of the Registrar, and the Tribunal shall dispose of the case accordingly.
(6) Where a reference is made to the High Court under this section, the cost (including the disposal of the fee) shall be the discretion of the court.
(7) The payment of the amount, if any, of the tax due in accordance with the order of the Tribunal in respect of which an application has been made under Sub-section (1), shall not be stayed pending the disposal of such application or any reference made in consequence thereof, but if such amount is reduced as the result of such reference, the excess tax paid shall be refunded in accordance with the provisions of Section 12."
13. As noticed above, the respondent-petitioners in the writ petition did not avail of the remedy available under Section 22 of the Act, and on the contrary have straightaway come to this Court in its writ jurisdiction seeking quashing of orders passed by the Assistant Excise and Taxation Commissioner and the Tribunal. Section 21(1) of the Act empowers the Commissioner or any person who has been conferred with the powers of Commissioner to examine the legality or propriety of any proceedings which may come to his notice on his own. What exactly is the meaning and scope of interference on the ground of propriety needs to be cleared. The word "propriety" has not been defined under the Act. However, this expression has been used in almost all the Acts relating to imposition of sales tax in various States. The apex Court had the occasion to examine this expression "propriety" in case reported as Raman & Raman Ltd. v. State of Madras AIR 1956 SC 463 ; 1956 SCJ 368, a case dealing with Section 64-A of the Madras Act (20 of 1948) in Motor Vehicles Act (4 of 1939). Section 64-A reads thus :
"The State Government may, of its own motion or on an application made to it, call for the records of any order passed or proceeding taken under this chapter by any authority or officer subordinate to it, for the purpose of satisfying itself as to the legality, regularity or propriety of such order or proceeding and after examining such records, may pass such order in reference thereto as it thinks fit."
While determining the meaning of the word "propriety", it has been observed :
"The word 'propriety' has nowhere been defined in the Act and is capable of a variety of meanings. In the Oxford English Dictionary (Vol. VIII), it has been stated to mean 'fitness ; appropriateness ; aptitude ; suitability ; appropriateness to the circumstances or conditions ; conformity with requirement, rule or principle ; Tightness, correctness, justness, accuracy'."
14. Thus the propriety of the order can also be examined by the authorities exercising their suo motu powers. This is intended that there is no omission on the part of the Assessing Authority so as to jeopardize the fiscal interest of the State nor the assessment is so excessive so as to adversely affect the interest of the assessee. Thus, this power empowers the authorities to call for the records; go through them, consider the facts evidenced by the records and then enhance or reduce the assessment so that justice is done between the State and the assessee. Of course, if the order is proposed to be passed which is likely to affect the assessee adversely, he must be given an opportunity to show cause against the proposed enhancement.
15. Thus, while examining the propriety of an order, the authority can go into the factual aspects of the matter as well. Somehow, the assessee did not join these proceedings and so an ex pane order was passed. It is not the case of the respondents that the order passed by the authorities under Section 21 of the Act lacks inherent jurisdiction. Even the Tribunal has not found any error cither of jurisdiction or of propriety and so affirmed the same. Whether decision of these authorities on facts could be a matter of fresh enquiry by this Court, in fact, goes to the root of the matter. This Court while exercising the powers under Article 226 of the Constitution does not exercise any appellate powers. This is an exceptional remedy which is intended to redress blatant illegality or usurpation of power by an authority thereby infringing certain fundamental rights of the individuals or in some cases even his other legal rights. Thus, whereas there is no bar upon this Court to examine the matter irrespective of an alternative forum but invariably a cautious approach is taken and unless it is a case of grave injustice, the parties arc invariably relegated to its ordinary remedy under the statute. The apex Court in case reported as Thansingh Nathmal v. Superintendent of Taxes, Dhubri [1964] 15 STC 468 ; AIR 1964 SC 1419, held as under :
"7. Against the order of the Commissioner an order for reference could have been claimed if the appellants satisfied the Commissioner or the High Court that a question of law arose out of the order. But the procedure provided by the Act to invoke the jurisdiction of the High Court was by-passed ; the appellants moved the High Court challenging the competence of the Provincial Legislature to extend the concept of sale, and invoked the extraordinary jurisdiction of the High Court under Article 226 and sought to reopen the decision of the taxing authorities on a question of fact. The jurisdiction of the High Court under Article 226 of the Constitution is couched in wide terms and the exercise thereof is not subject to any restrictions except the territorial restrictions which are expressly provided in the articles. But the exercise of the jurisdiction is discretionary ; it is not exercised merely because it is lawful to do so. The very amplitude of the jurisdiction demands that it will ordinarily be exercised subject to certain self-imposed limitations. Resort to that jurisdiction is not intended as an alternative remedy for relief which may be obtained in a suit or other mode prescribed by statute. Ordinarily the court will not entertain a petition for a writ under Article 226, where the petitioner has an alternative remedy, which, without being unduly onerous, provides an equally efficacious remedy. Again the High Court does not generally enter upon a determination of questions which demand an elaborate examination of evidence to establish the right to enforce which the writ is claimed. The High Court does not therefore act as a court of appeal against the decision of a court or Tribunal, to correct errors of fact, and does not by assuming jurisdiction under Article 226 trench upon an alternative remedy provided by statute for obtaining relief. Where it is open to the aggrieved petitioner to move another Tribunal, or even itself in another jurisdiction for obtaining redress in the manner provided by a statute, the High Court normally will not permit by entertaining a petition under Article 226 of the Constitution the machinery created under the statute to be by-passed, and will leave the party applying to it to seek resort to the machinery so set up."
16. The facts of the aforesaid case are somewhat similar to the one under scrutiny. Here too, though there was no provision under the Assam Sales Tax Act, permitting an aggrieved person to approach the Board of Revenue to refer to the High Court any question of law arising out of an order and in case the Board declines to state the case, the dealer of his own can apply to the High Court calling upon the Board or Tribunal to state the case and in case the High Court thinks that the decision of the Commissioner is not correct, High Court can hear such a case and decide the question of law raised on a reference and deliver its judgment thereof. The apex Court thus held that there being a hierarchy of taxing Tribunals competent to decide question as to the liability of the tax-payer under the Assam Sales Tax Act, with a right to have questions of law arising out of the order decided by the High Court of the province, straightaway approaching the court under Article 226 is impermissible.
17. Since the matter in the instant case has been examined afresh by the learned single Judge finally allowing the prayer made by the petitioner, it, indeed, would not be proper now to reverse the decision of the learned single Judge on this ground alone. Whether cotton seed oil or washed cotton seed oil would per se come within the ambit of edible oil and whether such a question is a question of fact or law needs to be examined in the light of available material on record. This precise question in the first instance has been examined by the Assistant Excise and Taxation Commissioner exercising the powers under Section 21(1) of the Act. Learned Commissioner by exhaustively examining the matter from its nomenclature, consumability and edibility of the product and other allied factors like whether there exists any refinery plant for crushing the cotton seed and processing and taking all such other essential measures so as to make it edible was found wanting in the case of the assessee. Tribunal too found no ground to vary the decision. Learned single Judge has adverted to some of the provisions contained in the Prevention of Food Adulteration Act and the Rules framed thereunder, the provisions of the Agricultural Produce (Grading and Marking) Act ; report of the National Chemical Laboratory ; and the subsequent instructions issued by the Central Government in September, 1990. High Court of Hyderabad in Kishenlal Oil Mills' case [1955] 6 STC 650, was called upon to examine whether there is basis to quash the order of the Commissioner of Sales Tax by which he has levied sales tax on applicant's purchase turnover of groundnut, kernel and on the sale of cotton seed oil. There the court placed reliance upon the report of the National Chemical Laboratory as to whether cotton seed oil is edible and held as under :
"The second point, viz., whether cotton-seed oil is edible, is a question of fact. We have gone through the report of the Chemical Laboratories and find that at some stage or other if the cotton seeds are subjected to a highly specialised process, it might be possible to extract oil which is edible. The National Chemical Laboratories have in their report stated as under :
'Cotton seed oil when pressed from cotton seeds is dark and unappetising. On refining with alkali, bleaching with bleaching earths generally followed by deodorisation, colouring matters are removed and a light coloured oil is obtained. Most of this colour is due to a pigment called gossypol ; on alkali treatment, the pigment is carried away leaving a light coloured oil.
Refined cotton seed oil, provided it is of the quality usually expected of an ordinary refined vegetable oil like groundnut, sesame, till, etc., is completely harmless and edible. This has been proved in the laboratory by test on rats ; while especially in America, where the major oil is refined cotton seed oil, it has been eaten without ill-effects for over 30 years. It is also being consumed after refining in various parts of India. It can be used as food material as such or after hydrogenation to vanaspati.
Refined cotton seed oil of good quality is hence an edible oil just like any other edible vegetable oil.' The report taken as a whole would show that cotton-seed oil at any rate for the present has not become edible in the hands of the dealer."
18. May be one can differ with the view taken by the authority under the Sales Tax Act but such an order cannot be said to be without jurisdiction ; violative of any of the provisions of the Sales Tax Act which permits the authorities to examine the propriety of any order passed by a subordinate authority. Even if it be taken that two views were possible in a given circumstance (though it cannot be said in the instant case) yet at best it can be termed to be a disputed question of fact for which also writ petition is not an appropriate remedy. It was for the assessee to produce evidence to satisfy the Assessing Authority regarding the query made. No evidence was put before the Assistant Excise and Taxation Commissioner and even the subsequent opportunity granted by the Tribunal was not availed of. With this background, the matter indeed could not be examined by the court under Article 226 of the Constitution.
19. Reference to the salient facts of Bharat General and Textile Industries Ltd. case [1989] 72 STC 354 (SC), would be appropriate. Counsel for the appellant has placed reliance upon this decision whereas respondents counsel has tried to distinguish the ratio of the aforesaid judgment. The petitioners in the aforesaid case filed a petition under Article 42 of the Constitution of India to challenge the constitutional validity of Section 41 of the Bombay Sales Tax Act on the ground that it confers arbitrary powers of exemption on the State Government so as to exempt all types of new units from the payment of purchase tax, sales tax and Central sales tax under the Package Scheme of Incentives, 1979. Facts as have come on record, Government in exercise of its powers under Section 41 of the Act, by notification has exempted certain industries engaged in the production of edible as well as non-edible oils set up in backward areas. Subsequently, the Government came to realise that this exemption given under the Package Scheme of Incentives, 1979, for a period ranging from 5 to 9 years without any limit had conferred far more benefits on some of the industries concerned than what the Government had in mind when the notifications granting tax exemptions were made. The Government thought of modifying the same and so vide the impugned notification limited the benefit of exemption to 100 per cent of the gross fixed capital investment of eligible units. By a subsequent circular concessions regarding edible oil units were further clarified. It is in this context that the Act prescribed that the "units producing and selling non-edible oils" and the units manufacturing and selling "washed cotton seed oil", "soyabean raw oil (grade I)" and "unrefined sunflower cake oil" would not come within the category of units manufacturing edible oils. It is in this light that some of the petitioners who were engaged in producing washed cotton seed oil contended that washed cotton seed oil will also fall within the category of edible oil and that there are several technical authorities who gave their opinion to that effect and so these units are entitled to tax exemptions. These contentions were not accepted by the State Government and so the petitioners approached the Supreme Court. It is in this light that the apex Court held as under :
"In so far as the second contention is concerned, viz., that washed cotton seed oil would also fall in the category of edible oils in spite of the fact that it has to be processed still further for being made fit for human consumption, we find that the contention is not a tenable one. The petitioners had contended before the Government that washed cotton seed oil is also one type of edible oil but the Government have rejected this contention stating that since washed cotton seed oil cannot be made use of without further processing for direct human consumption, it would not fall in the category of edible oil. This position is not controverted by the petitioners and, therefore, as long as the washed cotton seed oil that is produced is sold without further processing it will not constitute edible oil. The Government therefore, arc well within their powers in refusing to accept the petitioner's contention that washed cotton seed oil is also edible oil and, therefore, all the new units which are engaged in the manufacture of washed cotton seed oil should also be rendered ineligible from enjoying the benefit of tax exemption as has been done in the case of units producing edible oil."
20. The apex Court thus held that the cotton seed oil to fall in the category of edible oil is to be processed so as to make it fit for human consumption. So in the instant case, it is the case of the respondent-petitioners that they sold washed cotton seed oil. Whether the respondent-petitioners had the necessary infrastructure to make this crude oil edible, of course, will be a matter of fact which has been examined by the authorities under the Sales Tax Act. We thus find merit in the plea of the appellant and hold that this question of fact cannot be a matter of fresh adjudication in the writ petition. We find no merit in the plea advanced by the counsel for the respondent-petitioners that as the learned single Judge did not examine the other contentions, as the petition has been accepted, this Court may remit the matter to the learned single Judge to consider other pleas raised by the petitioners in their writ petition. We also find no ground to exempt the petitioners from paying interest on the amount which was determined by the Assistant Excise and Taxation Commissioner under suo motu powers. The Assistant Excise and Taxation Commissioner in his order dated November 24, 1996 in the case of Milkhi Ram Oil and Dall Mills examined in the light of Sales Tax Act and relied upon the decision of the apex Court in case reported as Associated Cement Co. Ltd. v. Commercial Tax Officer, Kota [1981] 48 STC 466 wherein it was held as under:
"...............Wherever the intention to impose liability is clear courts ought to have no hesitation in giving what we may call a commonsense interpretation to the machinery sections so that the charge does not fail.
In the present case if we construe the words 'on the basis of return' occurring in Sub-section (2) of Section 7 of the Act as on the basis of a true and proper return which ought to have been filed Under Sub-section (1) of Section 7 then all the three classes of persons, viz., (i) those who have not filed any return at all and who are later on found to be liable to be assessed, (ii) those who have filed a true return but have not deposited the full amount of tax which they are liable to pay, and (iii) those who have filed a return making a wrong claim that cither the whole or any part of the turnover is not taxable and who are subsequently found to have made a wrong claim, would be placed in the same position and they would all be liable to pay interest on the amount of tax which they are liable to pay but have not paid as required by Sub-section (2) of Section 7 of the Act. We are of the opinion that this view is in conformity with the legislative intention in enacting Section 11B of the Act."
This provision in the Rajasthan Sales Tax Act is in pari materia with the provisions contained in the Punjab General Sales Tax Act. On this ground, we are not inclined to interfere with the order passed by the Assistant Excise and Taxation Commissioner which has been affirmed by the Tribunal. Consequently, we accept the appeals, set aside the impugned order of the learned single Judge and dismiss the writ petitions.
21. Civil Writ Petitions Nos. 264, 311, 313 to 315, 1302, 6919, 1673, 2011, 2084 of 1987, 8409 of 1988 and 6663 of 1989 relate to show cause notice issued by the Assistant Excise and Taxation Commissioner in terms of Section 21(1) of the Act. Thus, the petitioners, in fact, did not exhaust the remedy available to them, i.e., under Section 21(1) of the Act and revision before the Tribunal. This petition, in fact, is pre-mature. Accordingly, we dismiss the petition and relegate the petitioners to appear before the concerned authority and raise all such objections as permissible.
22. In Civil Writ Petitions Nos. 13719, 13720, 15200 and 15206 of 1994 challenge is to the assessment made by the Assessing Authority. The petitioners, in the aforesaid writ petitions, have remedy of appeal and revision under the Punjab General Sales Tax Act. In view of the existence of alternative remedy, the writ petitions merit dismissal and ordered accordingly.
23. Resultantly, we accept the appeals and dismiss the writ petitions. No order as to costs.