Rajasthan High Court - Jaipur
Asstt Commissioner Special Circle-Raj vs M/S Mangalam Cement Ltd on 23 April, 2019
Author: Veerendr Singh Siradhana
Bench: Veerendr Singh Siradhana
HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT
JAIPUR
S.B. Sales Tax Revision / Reference No. 53/2016
Asstt Commissioner Special Circle Raj
----Petitioner
Versus
M/s Mangalam Cement Ltd
----Respondent
Connected With S.B. Sales Tax Revision / Reference No. 54/2016 Asstt Commissioner Special Circle Raj
----Petitioner Versus M/s Mangalam Cement Ltd
----Respondent S.B. Sales Tax Revision / Reference No. 55/2016 Asstt Commissioner Special Circle-Raj
----Petitioner Versus M/s Mangalam Cement Ltd
----Respondent S.B. Sales Tax Revision / Reference No. 56/2016 Asstt Commissioner Special Circle-Raj
----Petitioner Versus M/s Mangalam Cement Ltd
----Respondent S.B. Sales Tax Revision / Reference No. 57/2016 Asstt Commissioner Special Circle-Raj
----Petitioner Versus M/s Mangalam Cement Ltd
----Respondent (Downloaded on 28/06/2019 at 01:29:01 AM) S.B. Cross Objection Civil No. 15/2017 Assistant Commissioner, Special Circle- Rajasthan- Jaipur.
----Petitioner Versus M/s. Mangalam Cement Limited, Presently At 2Nd Floor, Geejgarh Tower, Hawa Sarak, Civil Lines, Jaipur Previous Address At 30 Shrirampura Colony, Civil Lines, Jaipur, Rajasthan.
----Respondent S.B. Cross Objection Civil No. 16/2017 Assistant Commissioner, Special Circle- Rajasthan- Jaipur.
----Petitioner Versus M/s. Mangalam Cement Limited, Presently At 2Nd Floor, Geejgarh Tower, Hawa Sarak, Civil Lines, Jaipur Previous Address At 30 Shrirampura Colony, Civil Lines, Jaipur, Rajasthan.
----Respondent S.B. Cross Objection Civil No. 17/2017 Assistant Commissioner, Special Circle- Rajasthan- Jaipur.
----Petitioner Versus M/s. Mangalam Cement Limited, Presently At 2Nd Floor, Geejgarh Tower, Hawa Sarak, Civil Lines, Jaipur Previous Address At 30 Shrirampura Colony, Civil Lines, Jaipur, Rajasthan.
----Respondent S.B. Cross Objection Civil No. 18/2017 Assistant Commissioner, Special Circle- Rajasthan- Jaipur.
----Petitioner Versus M/s. Mangalam Cement Limited, Presently At 2Nd Floor, Geejgarh Tower, Hawa Sarak, Civil Lines, Jaipur Previous Address At 30 Shrirampura Colony, Civil Lines, Jaipur, Rajasthan.
----Respondent S.B. Cross Objection Civil No. 19/2017 Assistant Commissioner, Special Circle- Rajasthan- Jaipur.
----Petitioner Versus (Downloaded on 28/06/2019 at 01:29:01 AM) M/s. Mangalam Cement Limited, Presently At 2Nd Floor, Geejgarh Tower, Hawa Sarak, Civil Lines, Jaipur Previous Address At 30 Shrirampura Colony, Civil Lines, Jaipur, Rajasthan.
----Respondent For Petitioner(s) : Mr. R.B. Mathur with Mr. Prabhansh Sharma For Respondent(s) : Mr. N.M. Ranka, Sr. Counsel, Mr. R.K. Agarwal, Sr. Counsel with Mr. Rishabh Khandelwal, Mr. N.K. Jain HON'BLE MR. JUSTICE VEERENDR SINGH SIRADHANA Order 23/04/2019 The above noted Sales Tax Revisions/References and cross objections filed by the respondent-M/s. Mangalam Cement Limited, raise common questions of law and facts, and therefore, the matters have been taken up together for adjudication by this common order, consented by the counsel for the parties. For convenience, factual matrix of Revision Petition No.53 of 2016, has been taken note of.
2. Shorn off unnecessary details, the essential skeletal material facts are: M/s Mangalam Cement Ltd. i.e. the respondent commenced its commercial production of products from 14 th January, 1994 and suffered heavy financial losses, decreasing the net worth of the company. Therefore, the respondent company approached the Board for Industrial and Financial Reconstruction (for short, BIFR), for its revival. BIFR accepting the application of the respondent company, declared it, a sick company and was directed to formulate a Scheme for revival. The respondent company stopped its operations in February of 2003, due to heavy (Downloaded on 28/06/2019 at 01:29:01 AM) losses, and therefore, requested for 75% benefit under both Rajasthan Sales Tax (for short, RST) and Central Sales Tax Exemption (for short, CST), against earlier benefit of 25% for RST and 75% for CST, which was allowed by the Board of Infrastructure Development and Investment (for short, BIDI), vide notification dated 29th May, 2003. The BIFR, thereafter, finalizing the rehabilitation Scheme for the revival of the respondent sick company, further extended the time period of rehabilitation Scheme benefits to the respondent company up till 4 th April, 2007, vide notification dated 15th April, 2005. The said rehabilitation Scheme was with the specific condition that the benefits to the respondent company shall be available subject to the decision of the Apex Court of the land in the pending case of Binani Cement Ltd. The respondent-company no longer remained a sick company and was fully revived by the year 2007. The Apex Court of the land in the case of Binani Cement Ltd., delivered the judgment dated 19th February, 2014, holding against the sick company, thus, negating the benefits of the rehabilitation Scheme, and therefore, the benefits so availed of by the respondent company became non-admissible. As a result, the petitioner issued show cause notices to the respondent company, dated 3 rd March, 2014, for recovery of sales tax exemption allowed in excess of 25% of RST. The respondent company filed objections through appeal before the Commissioner that was rejected. The Division Bench of the Rajasthan Tax Board vide its order dated 30 th November, 2015 and the amended order dated 3rd December, 2015, allowed the appeal filed by the respondent-company; of which the petitioner is aggrieved of. And therefore, has instituted the instant (Downloaded on 28/06/2019 at 01:29:01 AM) proceedings, raising following questions of law in the backdrop of the orders made by the Rajasthan Tax Board, which reads thus:
i) Whether in the facts and circumstances of the case of Rajasthan Tax Board was justified in law and has not acted illegally and perversely in allowing the appeal filed by the respondent despite of the judgment of Hon'ble Apex Court on merits in the case of M/s. Binani Cement and the same is law of land.
ii) Whether in the facts and circumstances of the case the Rajasthan Tax Board has not acted illegally and perversely in observing that the petitioner is not taken any action in pursuance to the directions of BIFR dated 24.05.2007, when the said directions were merely obiter and not binding and further no action was required after the judgment of Hon'ble Apex Court.
(iii) Whether in the facts and circumstances of the case if the judgment of Rajasthan Tax Board will allow to stand it will not amount to discrimination with other similarly situated units.
(iv) Whether in the facts and circumstances of the case the Rajasthan Tax Board has not acted illegally and perversely in not correctly considering the notification dated 29.05.2003, in which there was clear condition that the said benefit given to the respondent is subject to judgment of Hon'ble Apex Court in the case of M/s. Binani Cement.
(v) Whether in the facts and circumstances of the case the respondent assessee was not estopped from questioning the liability arising out of judgment of Hon'ble Apex Court, when it has accepted the notification dated 29.05.2003 and has never questioned the conditions mentioned in the same.(Downloaded on 28/06/2019 at 01:29:01 AM)
3. Mr. R.B. Mathur, learned counsel for the petitioner contended that the respondent company started its commercial production on 12th July, 1990. After permission from Government to setup another unit established a second unit by the name of M/s Neer Shree Cement Ltd., which started its commercial production on 14th January, 1994. The respondent-company filed an application for exemption from tax under the Rajasthan Sales Tax/Central Sales Tax Exemption Scheme for Industries, 1989, and was allowed benefit of 25 % rebate in RST and 75% rebate in CST vide order dated 11th November, 1994, of the SLSC, as the unit established under the name of M/s Neer Shree Cement Ltd. Thus, it was not a new industrial unit rather just an expansion; hence, the benefit of 'a new industrial unit' and 'very prestigious unit', could not have been accorded to the respondent company.
4. According to learned counsel the State Government announced a new Scheme as the Rajasthan Sales Tax/Central Sales Tax Exemption Scheme for Industries, 1998, dated 7 th April, 1998, wherein a new industrial unit, setup on the site of an existing industrial unit, by separate capital investment; were also included in the category of 'new industrial unit'. Therefore, M/s Neer Shree Cement Ltd. filed a fresh application before the SLSC under the provisions of the new Scheme, and thus, the SLSC granted an exemption of 25 % in RST and 75% in CST of tax for a period of 11 years starting from 5th April, 1994 and onward. It is pleaded case of the petitioners that on a consideration of the representation of the respondent-company on 2 nd and 7th May 2003, exemption was accorded vide notification dated 29th May 2003, subject to the following conditions: (Downloaded on 28/06/2019 at 01:29:01 AM)
1. The company will be allowed 75% exemption on RST and 75% exemption on CST, for the remaining unexpired period, for exemption, available as sanctioned by SLSC for its M/s Neer Shree Unit (Second Unit) . The management of the company shall endeavour to revive the Manglam Unit, which has already closed down from February, 2003.
. The benefits would be available to the management subject to the condition that the Neer Shree Unit shall not be closed down before the expiry of period of benefits.
. Above benefits will be available to the unit subject to the decision of the Supreme Court in the case of Binani Cement Ltd.
5. Thus, the rebate in tax was granted to the respondent- company with the condition that the benefit shall be subject to the decision of the Apex Court of land in the pending appeal in the matter of Binani Cement Ltd. For rehabilitation of the respondent- company, a sanctioned Scheme was issued by the BIFR, wherein the period for relief of 75% of rebate in tax was further extended for a period of 3 years effective from 1st April, 2005, vide notification dated 15th April, 2005. On 24th May, 2007, the BIFR discharged the respondent-company from the purview of SICA with the directions as stated below:
"As the company M/s Binani Cements Ltd. (BCL) is neither a sick company registered in the BIFR, nor a group/associate company of the promoters of the company M/s MCL, the GOR would de-link the case of M/s BCL for grant of the envisaged reliefs to the company M/s MCL and, accordingly, the GOR would issue a revised notification, in r/o their earlier notifications dated 29.05.03 & 28.07.06 issued in this regard."(Downloaded on 28/06/2019 at 01:29:01 AM)
The Section 32 (1) of SICA is as follows:
"32. EFFECT OF THE ACT ON OTHER LAWS.
(1) The provisions of this Act and of any rules or scheme made there under shall have effect notwithstanding anything inconsistent therewith contained in any other law except the provisions of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and the Urban Land (Ceiling and Regulation), 1976 (33 of 1976) for the time being in force or in the Memorandum or Articles of Association of an Industrial company or in any other instrument having effect by virtue of any law other than this Act."
6. Although, no such revised notification had been issued by the BIFR till date. Be that as it may, the Supreme Court allowed the pending appeal against M/s Binani Cement Ltd., holding that the company is entitled to claim only 25 % of exemption in tax, vide judgement dated 19th February, 2014. In light of the judgment of the Supreme Court in the case of Binani Cement Ltd.; and in view of specific Condition No. 7, of the notification issued on 29 th May, 2003, which clearly stated that said benefit of exemption of tax to the extent of 75% was made available to the respondent-company subject to the decision in the pending appeal in the case of Binani Cement Ltd. that was pending before the Supreme Court at that time; the Assessing Officer while finalizing the assessment of the respondent-company for the assessment year 2003-04 to 2007- 08, determined/imposed balance tax and interest for the aforesaid assessment periods, holding the respondent-company entitled to only 25% of tax rebate rather than 75% that had been availed for the said period. The Assessing Officer vide order dated 22 nd May, 2014, made the demand of Rs. 22,08,03,856/- (Rupees Twenty Two Crore Eight Lac Three Thousand Eight Hundred Fifty Six), from the respondent-company which was calculated as the excess (Downloaded on 28/06/2019 at 01:29:01 AM) tax rebate allowed to the respondent-company as per the notification dated 29th May, 2003, and thereafter, rectified by the Assessing Officer by reducing an amount of Rs.36,13,638/- (Rs. Thirty Six Lax Thirteen Thousand Six Hundred Thirty Eight), from the demanded amount of Rs. 22,08,03,856/- (Rupees Twenty Two Crore Eight Lac Three Thousand Eight Hundred Fifty Six), vide order dated 9th July, 2014. The respondent-company filed appeal against the said orders aforesaid, before the appellate authority, which was rejected vide order dated 14th August, 2014. However, the respondent-company was successful in appeal before the Rajasthan Tax Board, as the appeal was allowed vide impugned order dated 30th November, 2015.
7. Counsel for petitioner vehemently asserted that the respondent-company had taken advantage of the exemption in tax as per the notification dated 29 th May, 2003, which was issued subject to the decision of the Supreme Court in the case of Binani Cement Ltd. and now wants to turn around and dispute the liability which arose in light of the controversy that was pending consideration before the Supreme Court at the relevant time. The respondent-company cannot reap the benefits which were accorded to it with the specific condition incorporated and attached thereto. The respondent-company cannot agree to one part of the notification, which was beneficial to it and now dispute the liability, after reaping the benefits in interregnum. Further, the respondent-company never questioned the said condition of the notification dated 29th May, 2003. For the benefit was accorded to the respondent-company in light of the Binani Cement Ltd.'s case and when the same has been decided by the Supreme Court; now (Downloaded on 28/06/2019 at 01:29:01 AM) there is no scope for taking a diametrically different view with the verdict is against. Furthermore, exemption already accorded and availed by the respondent-company can be withdrawn retrospectively.
8. Learned counsel for the petitioners further pointed out the fact that the respondent-company approached the State Government on 10th March, 2003, for 75 % exemption from tax under both RST and CST for their second unit, through a representation, wherein the respondent-company specifically mentioned that the said concession has been provided to M/s Gujarat Ambuja (Earlier known as M/s DLF Cement Ltd.), and therefore, similar concession be allowed to its second unit as well, which was allowed by the BIDI subject to the outcome and adjudication by the Supreme Court in the case of Binani Cement Ltd. Therefore, the respondent-company now cannot claim that the Binani Cement's judgment is not applicable to it.
9. It is further asserted by the counsel for petitioners that exemption from payment of tax shall only be accorded by the State Government by notification in the official gazette, fully or partially, with or without any condition, as specified under the said notification; as is evident in view of section 15 of the RST Act, 1994, and 8(5) of the CST Act, 1956. The exemption accorded under the said provisions, to the respondent-company, vide notification dated 29th May, 2003, with a specific condition; therefore, the respondent-company is entitled to avail of the benefits under the said notification only on fulfillment of the conditions stipulated therein. Furthermore, the State cannot discriminate between same class of persons, and if, the impugned (Downloaded on 28/06/2019 at 01:29:01 AM) order dated 30th November, 2015, of the Rajasthan Tax Board, is allowed to stand and implemented that will amount to discrimination between the respondent-company and in the case of Binani Cement, Gujrat Ambuja and J.K. Lakshmi; and other such companies of the class.
10. The Rajasthan Tax Board, as urged, erred in passing the impugned order dated 30th November, 2015, as it is contrary to the judgment of the Supreme Court and has been made without application of mind. Moreover, the Rajasthan Tax Board, based its decision on the observation made by BIFR, which is merely an observation of the BIFR and an obiter, and thus, cannot be binding. It is further added that as per the provisions of Section 32(1) of SICA, the Scheme made under the provisions thereto has effect over the State and Central Sales Tax Law, but, any direction issued by the BIFR, beyond the sanctioned Scheme, has no binding force over the State and Central Sales Tax Law, meaning that the said direction/observation would only have an advisory force and no mandatory effect. Therefore, the impugned order is bad in law and perverse to the findings of the Assessing Officer, which were further upheld by the appellate authority. In order to fortify his stand learned counsel has relied upon the following opinions of various Courts including of Supreme Court. State of Rajasthan and Another Vs. J.K. Udaipur Udyog Ltd. and Another: (2004) 7 SCC 673 Commissioner of Custom (Import), Mumbai Vs. Dilip Kumar and Company and Ors.:(2018) 9 SCC 1 State of Uttar Pradesh and Another Vs. Mahindra and Mahindra Limited: (2011) 13 SCC 77 (Downloaded on 28/06/2019 at 01:29:01 AM) Rajasthan Felt Manufacturing Company Vs. The State of Rajasthan and Ors.:1978 WLN 76.
Pepsico India Holding Ltd. Vs. Commissioner of Trade Tax, Lucknow, Uttar Pradesh: (2011) 13 SCC 68 Official Liquidator Vs. Dayanand and Ors.: (2008) 10 SCC 1 Commissioner of Central Excise, Nagpur Vs. Gurukripa Resins Pvt. Ltd.: (2011) 13 SCC 180
11. Mr. N. M. Ranka, learned senior counsel for the respondent- company with Mr. Rishabh Khandlewal Advocate, contended that there arise, in fact, no questions of law in the matters at hand as the factual matrix of the case has been considered at length and in a great detail by the Rajasthan Tax Board; and the same was appreciated by the Board, and thereafter, the order impugned dated 30th November, 2015, was made in accordance to the provisions of law, which calls for no interference by this Court in exercise of writ jurisdiction. The petitioner department intends to withdraw the concession already extended to the respondent- company, which has helped revive the respondent-company from sickness and that too on the basis of a condition which was incorporated and severed the purpose in view of the directions of the BIFR.
12. It is further asserted by the learned senior counsel that the revision petition(s), on the face of it, is/are barred by limitation. As per the provisions of law, the limitation prescribed to initiate the proceedings under Central Sales Tax Act, 1956, for re- assessment of an escaped turnover is five years, from the end of the relevant assessment period. The relevant assessment year, in (Downloaded on 28/06/2019 at 01:29:01 AM) the matter at hand, shall be 2007-08, thus re-assessment or any proceeding cannot be initiated by the petitioner department. Moreover, the proceedings involved herein have been initiated long after the expiry of the prescribed period of limitation. Similarly, the limitation period prescribed for rectification of a mistake or an error apparent on the face of the record, is also four years from the date of that order. Further, learned counsel asserted that the provisions of Section 24(5) of the Rajasthan VAT Act, 2003, prescribes a time limit of two years from the end of relevant assessment year for the purpose of carrying out re-assessment and Section 24(6) of the Rajasthan VAT Act, 2003, prescribes a time limit of two years form passing of an assessment order as a consequence of any order of an appellate or revisional authority or a competent Court. It would, thus, be evident from a bare reading of above mentioned provisions that no such order has been passed in the respondent- company's case by the appellate or revisional authority or competent court thereof, so as to invoke the provisions of Section 24(6) of the Rajasthan VAT Act, 2003, which is, clearly, not the case in the matters at hand. Furthermore, provisions of Section 33(1) of the Rajasthan VAT Act, 2003, prescribes for rectification of any mistake or error apparent on the face of the record, pursuant to an order passed by the Rajasthan High Court, Rajasthan Tax Board or the Apex Court of the land. Thus, fact remains that the current proceedings have been initiated on the basis of the judgement of the Supreme Court in the case of Binani Cement Ltd., wherein the respondent-company was not even a (Downloaded on 28/06/2019 at 01:29:01 AM) party to the said proceedings. Hence, the opinion is inapplicable to the case of the respondent-company.
13. Learned Senior Counsel for the respondent-company emphasized that the petitioner for the sake of convenience has absolutely ignored the directions given by the BIFR vide order dated 31st May, 2007, to the State Government, who was duty bound to examine the matter and take necessary action in compliance of the said directions made by the BIFR, to sever the case of the respondent-company from that of Binani Cement Ltd.; as the case of Binani Cement Ltd. is not the same as that of the respondent-company. Further, no appeal was preferred against the order dated 31st May, 2007 of the BIFR; hence, the order became final and binding. Hence, the contention putforth by the counsel for the petitioner that direction of the BIFR was merely obiter and has no binding effect; is baseless and misleading in view of the law of the land. The provisions of section 18 (9) read with section 18 (12) of the SICA, very clearly and in no uncertain terms empowers the BIFR to issue any direction(s) it may think fit, to effectively implement the provisions of the sanctioned Scheme. The directions so issued by the BIFR vide order dated 31 st May, 2007, reads thus:
"As the company M/s Binani Cements Ltd. (BCL) is neither a sick company registered in the BIFR, nor a group/associate company of the promoter of the Company M/s MCL, the GOR would de-link the case of M/s BCL for grant of the envisaged reliefs to the company M/s MCL and, accordingly, the GOR would issue a revised notification, in respect of their earlier notifications dated 29.05.2003 & 28.07.2006 issued in the regard."(Downloaded on 28/06/2019 at 01:29:01 AM)
14. Further, the direction of the BIFR, was for de-linking the case of the respondent-company from Binani Cement Ltd.'s case through the revised notification, in order to enable the respondent-company to emerge out of the sickness availing of the relief accorded to it through the sanctioned Scheme, which was duly allowed by the State Government as well. Moreover, the fact that no objection or any kind of appeal, was made against the directions of the BIFR by the State Government, reflected the State Government's intention to comply with the directions. The petitioner has not disputed the letter dated 15 th June, 2007, before this Court as well, whereby the order dated 24 th May, 2007, was communicated to the Secretary of the Finance Department for implementation of the directions of the BIFR. Thus, it makes evident the intention of the department to comply with the said direction, to de-link the condition of Binani Cement's case from that of the respondent-company's case. Furthermore, the BIFR through its order dated 24th May, 2007, as per para 10(iv), also directed that other unimplemented provisions of the sanctioned Scheme dated 18th January, 2005, shall continue to remain in force for the unexpired period of the Scheme, which clearly indicated that the said benefit of exemption to the respondent- company, continued even after the order dated 24 th May, 2007, of the BIFR. Therefore, the petitioner department itself continued to confer the benefit of exemption even after 31 st March, 2007. Hence, it cannot now turn back from the directions of the BIFR, alleging that the order dated 24th May, 2007, of the BIFR was beyond the Scheme sanctioned. On the contrary, the said order was well within the jurisdiction of the BIFR. (Downloaded on 28/06/2019 at 01:29:01 AM)
15. Learned Senior Counsel further argued that the provisions of Section 14 of the RST Act, 1994, prescribes a bar against collection of tax more than the amount payable under the provisions of the Act of 1994. Thus, the petitioner department is prohibited from collecting tax in excess to the 25% exemption under RST Act, 1994, and any act to the contrary will be arbitrary and bad in law. Furthermore, Section 15 of the RST Act, 1994, prescribes for grant of exemption prospectively or retrospectively, as contended. But, there is no such provision in the said Act of 1994, where there can be a withdrawal of exemption in tax and that too retrospectively. Therefore, such retrospective withdrawal of exemption in tax cannot be allowed in view of doctrine of estoppel.
16. Learned Senior Counsel for the respondent-company asserted the fact that BIFR directed the State Government for consideration of the matter, in view of grant of relief of 75% exemption in tax, exemption in electricity duty, exemption of entry tax on raw materials purchase, etc. vide letter dated 21 st February, 2006, 26th April, 2006 and 17th October, 2006; and if the State did not respond within a period of 30 days, its consent would be presumed. Similarly, as there was no response or objection from the State Government regarding the order dated 24 th May, 2007, of the BIFR, within the said period of 30 days; the directions mentioned in the said order were deemed to have been agreed to and granted by the State Government as well.
17. That apart, comparing the case of Binani Cement Ltd. with the matter at hand, there is a clear distinction between the facts of both the matters. In the case of Binani Cement Ltd., the (Downloaded on 28/06/2019 at 01:29:01 AM) question which fell for adjudication before the Supreme Court, was in respect of the quantum of sales tax exemption available to Binani Cement Ltd. under the sales tax initiative Scheme of 1989, which allowed for 25% of exemption of tax while Binani Cement Ltd. had claimed 75% of exemption in tax. The Supreme Court, held that clause 1E is specific to cement units, and therefore, shall be applicable, and hence, allowed only 25% of tax exemption to the industry under the sales tax initiative Scheme of 1989. Therefore, at the very first glance of both the companies, it can be observed that Binani Cement Ltd. started its commercial production in the year of 1997, while the respondent-company started its commercial production in the year 1994, more particularly, when the Clause 1E was not even in vogue. On a close consideration of the factual matrix of the case of Binani Cement Ltd., it would be evident that the facts of the case at hand are completely distinguishable and different.
18. Learned counsel for the respondent-company further added that the main object and motive underlying SICA, is, in the larger public interest to revive sick industries and for that very purpose Schemes are sanctioned in order to rehabilitate the sick industries, which is a temporary measure to accord the sick industry a fighting chance of revival. The respondent-company was also accorded the same benefit at the relevant time in order to revive the company and emerge out of the sickness. If the contentions of the petitioner are to be allowed then that shall defeat the very purpose of SICA, as well as, would be against the contemplation of the legislation too. In order to buttress his stand, learned (Downloaded on 28/06/2019 at 01:29:01 AM) Senior Counsel for the respondent-Company, has relied upon the following opinions:
Ghanshyam Sarda Vs. Shiv Shankar Trading Company:
(2015) 1 SCC 298 Director General of Income Tax (Admin) and Another Vs BIFR and Ors.: (2012) 171 Comp Case 147 Kusheshwar Prasad Singh Vs. State of Bihar and Ors.:
(2007) 11 SCC 447 Commissioner of Central Excise Vs. Srikumar Agency and Ors.: (2009) 1 SCC 469 Commissioner of Income Tax Vs. Simplex Concrete Piles Ltd.
and Another.: (2013) 358 ITR 129(SC) Raj Kumar Bapna Vs. Union of India and Another:
[2001]251ITR802(Raj) Parashuram Pottery Works Co. Ltd. Vs. Income Tax Officer, Circle I, Ward A, Rajkot (1961) 106 ITR 1(SC) Food Corporation of India Vs. State of Haryana:
(2000)3SCC495 Vikrant Tyres Ltd. Vs. First Income Tax Officer:[2001] 247 ITR 821 (SC) Philips India Ltd. and Another Vs. Assistant Commissioner:
(2004) 10 SCC 436.
J.K. Synthetics Ltd. and Birla Cement Works Vs. Commercial Taxes Officer and State of Rajasthan: (1994) 4 SCC 276 Cimmco Birla Ltd. Vs. LSDO and Ors.: (2013) III LLJ 455 Raj.
Krishnadevi Malchand Kamathia Vs. Bombay Environment Action Group (2011) 3 SCC 363 (Downloaded on 28/06/2019 at 01:29:01 AM) Amardeep Association Vs. Dakshin Gujrat: 2010GLH(3)431 Southern Refineries Vs. State of Kerala:ILR 2013 (1) Kerala
696. Raheja Universal Ltd. Vs. NRC Ltd. (2012) 4 SCC 148 Shree Karthik Papers Ltd. Vs. Government of Tamil Nadu:
MANU/TN/3510/2009.
Diamond Plastic Industries Vs. Government of Andra Pradesh and Ors.:(1999)9 SCC 121.
19. Heard the learned counsel for the parties at length and with their assistance perused the materials available on record as well as gave my thoughtful consideration to the rival submissions at bar and the opinions referred to and relied upon.
20. Considering the entire factual matrix, materials available on record and pleadings of the parties in the revision petitions and cross objections in totality, this Court can safely conclude that in fact the crux of the matter and the issues, in dispute, in substance are:
I. Whether the directions of the BIFR, through order dated 24 th May, 2007, are binding or merely an observation for the consideration of the State Government?
II. Whether the benefit of exemption in tax to the respondent company, can be accorded, while the condition number 7 of the notification dated 29th May, 2003; is not fulfilled?
III. Whether the respondent company can avail the conditional advantage of the exemption in tax, as accorded by the State (Downloaded on 28/06/2019 at 01:29:01 AM) Government, and later-on, challenge the said condition when the same is not fulfilled?
21. Indisputably, the respondent-company did not object to or challenge the Notification dated 29th May, 2003 of the State Government. Further, it is also not in dispute that the respondent-
company did avail of the benefits accorded to it under the said notification. Be that as it may, BIFR issued directions vide its order dated 24th May, 2007, for de-linking the case of Binani Cement Ltd. with reference to grant of relief to the respondent-company, and therefore, directed the State Government to remove the contingency clause of the outcome on the case of Binani Cement Ltd. from the sanctioned Scheme, implemented for the revival of the respondent-company.
22. BIFR is a specialized body, created by the legislature with an intention to revive sick industries or companies, and thus, it has complete supervisory control over the sick industries or company. The methodology to be adopted for revival of a sick industry or company is to be determined by the BIFR alone, thus, it has been vested with exclusive domain in such matters. The Scheme for rehabilitation of the sick industry or company, once sanctioned, shall be binding and would have the force of law. The legislative intent here is to help, supervise and rehabilitate the sick industry or company and to provide an opportunity to the sick industry or company to revive itself out of the sickness. Therefore, keeping the intent of the legislation, this court is of the view that condition number 7 of the Notification dated 29 th May, 2003, was not in consonance with the provisions of SICA and should not have been made a condition to begin with. The aforesaid condition, therefore, (Downloaded on 28/06/2019 at 01:29:01 AM) was rightly directed, by the BIFR, to be removed from the sanctioned Scheme; otherwise, the entire purpose of allowing the exemption in tax, accorded to the respondent-company for its revival, would fail. The purpose behind according exemption in tax to the respondent-company, was indeed to help the company revive itself. And later-on, it surfaced to be true to the underlying purpose for the respondent-company was declared 'not sick' by the BIFR vide its order dated 24 th May, 2007. At this stage, if the petitioner is allowed to charge the balance rebate in tax, accorded to the respondent-company, at the time it was sick, that will be arbitrary and detrimental to the public interest and contrary to the intention of legislation as well. And therefore, the directions issued by the BIFR vide its order dated 24th May, 2007, are correct and shall be binding. I find support in the aforesaid view from the opinion in the case of Raheja Universal Ltd. Vs. NRC Ltd. (2012) 4 SCC 148, wherein the Apex court of the land held, thus:
"42. The role of the BIFR does not end here and it may even periodically monitor the implementation of the scheme. Where the scheme relates to preventive, ameliorative, remedial and other measures with respect to any sick industrial company, the scheme may provide for financial assistance by way of loans, advances or guarantees from the Government or financial institutions. Before any financial institution is called upon to proceed to release the financial assistance to the sick industrial company in fulfilment of the requirements in that regard, the procedure contemplated under the provisions of Section 19 of the Act of 1985 has to be followed.
47. Section 22A of SICA 1985 empowers BIFR to pass orders in the interest of the sick industrial company or even in public interest requiring the sick industrial company not to dispose of, except with the consent of the BIFR, any asset during the period of preparation or consideration of (Downloaded on 28/06/2019 at 01:29:01 AM) the scheme under Section 18 SICA 1985 and during the period beginning with the recording of opinion for winding up of the company under Section 20(1) of the Act of SICA 1985 by BIFR up to commencement of the proceedings relating to winding up before the High Court.
48. All these provisions which fall under Chapter III of SICA 1985 have to be read conjointly and that too, along with other relevant provisions and the scheme of SICA 1985. It is a settled canon of interpretation of statutes that the statute should not be construed in its entirety and a sub-section or a section therein should not be read and construed in isolation. Chapter III, in fact, is the soul and essence of SICA 1985 and it provides for the methodology that is to be adopted for the purposes of detecting, reviving or even winding up a sick industrial company. Provisions under SICA 1985 also provide for an appeal against the orders of the BIFR before another specialised body, i.e., the AAIFR. To put it simply, this is a self- contained code and because of the non obstante provisions, contained therein, it has an overriding effect over the other laws. As per Section 32 of SICA 1985, the Act is required to be enforced with all its vigour and in precedence to other laws.
48. BIFR has been vested with wide powers and, being an expert body, is required to perform duties and functions of wide-ranged nature. If one looks into the legislative intent in relation to a sick industrial company, it is obvious that the BIFR has to first make an effort to provide an opportunity to the sick industrial company to make its net worth exceed the accumulated losses within a reasonable time, failing which the BIFR has to formulate a scheme for revival of the company, even by providing financial assistance in cases wherein the BIFR in its wisdom deems it necessary and finally only when both these options fail and the public interest so requires, the BIFR may recommend winding up of the sick industrial company. So long as the scheme is under consideration before the BIFR or it is being implemented after being sanctioned and is made operational from a given date, it is the legislative intent that such scheme should not be interjected by any other judicial process or frustrated by the impediments created by third parties and even by the management of the sick industrial company, in relation to the assets of the company.(Downloaded on 28/06/2019 at 01:29:01 AM)
50. In other words, the object and purpose of SICA 1985 is to ensure smooth sanctioning of the scheme and its due implementation. Both these stages, i.e., pre and post sanctioning of the scheme by the BIFR, are equally material stages where the provisions of Sections 22 and 22A read with Section 32 of SICA 1985 would come into play. Such an approach would also be acceptable as otherwise the entire scheme under Chapter III of SICA 1985 would be frustrated. Doctrine of frustration envisages that an exercise of special jurisdiction in futility, is neither the requirement of legislature nor judicial dictum.
56. BIFR, being a specialised body which is required to act as per the legislative intent indicated above, has jurisdiction to examine the matter and grant or refuse its consent for institution, continuation and recovery of dues payable to a particular creditor, whatever the nature of such dues may be. If such an interpretation is not given, the very purpose of SICA 1985 may stand defeated. For instance, a scheme is sanctioned by the BIFR and is at the stage of successful completion, where demand from the Revenue with regard to the sick industrial company is allowed, this can render the scheme ineffective and impossible to be executed, if permitted to be enforced against such company without approval/consent of the specialised body like BIFR.
57. Section 22A was introduced by the Amending Act 12 of 1994. The obvious intent of introducing the said provision was to empower the BIFR to issue any direction to the sick industrial company, its creditors and shareholders, in the interest of the company or even in public interest, directing the company not to dispose of any assets, except with the consent of the BIFR. The directions so issued are to remain in force during the preparation and consideration of the scheme. BIFR is also vested with similar powers where it recommends to the High Court for winding up of a company. The directive issued by BIFR would remain in force upto the commencement of the proceedings for winding up before the High Court.
60. The legislative intent of giving an over-riding effect to the declarations of the BIFR, as contemplated under Section 22(3) of SICA 1985, is further fortified by the language of Section 22(4), which states that any declaration made under Section 22(3) shall take effect notwithstanding anything contained in the Companies Act, 1956 or any other law, the memorandum and articles of (Downloaded on 28/06/2019 at 01:29:01 AM) association of the company or any instrument, decree, order of a court, settlement etc. Any remedy for enforcement of a right which may be available to a third party and any such proceedings before any court or tribunal shall remain stayed or be continued subject to such declaration. Section 22(4)(b) brings status quo ante and in fact, makes it clear that on cessation of such a declaration, the right, privilege, obligation or liability which was suspended shall become revived and enforceable as if the declaration had never been made. The proceedings will continue from the stage at which they were stayed.
84. This Court has taken the view in Tata Motors Ltd. v. Pharmaceutical Products of India Ltd. That (SCC p.635 para 31) SICA 1985 has been "enacted to secure the principles specified in Article 359 of the Constitution of India. It seeks to give effect to the larger public interest. It should be given primacy because of its higher public purpose".
85. As SICA 1985 is a special law and on the principle that a special law will prevail over a general law, it is permissible to contend that even if the provisions contained in Section 22(1) read with Section 32 of the Act, giving overriding effect vis-à-vis the other laws, other than the Foreign Exchange Regulation Act, 1973 and the Urban Land Ceiling and Regulation Act, 1976 had not been there, the provisions of the general law like the Companies Act, for Regulation, incorporation, winding-up etc. of the companies would have still been overridden to the extent of inconsistency.
86. We have already seen that this Court had, in Jay Engg., taken the view that the Interest on Delayed Payments to Small Scale and Ancillary Industries Undertaking Act, 1993 shall have to give way for enforcement of the provisions of SICA 1985. In Tata Davy (supra) also, the Court took the view that the State Sales Tax Act would have to be read and construed in comity to the provisions of SICA 1985 which shall have the overriding effect.
87. In Tata Motors Ltd. v. Pharmaceuticals Product of India Ltd. (supra), this Court was concerned with the provisions of mismanagement and oppression contained in Sections 391 and 394 of the Companies Act and whether the Company Court will have the jurisdiction to pass orders in preference to the proceedings pending before the Court (Downloaded on 28/06/2019 at 01:29:01 AM) under the SICA 1985. The Court while holding the primacy of SICA 1985 held as under: (SCC p.635, paras 31-33).
"31. SICA furthermore was enacted to secure the principles specified in Article 39 of the Constitution of India. It seeks to give effect to the larger public interest. It should be given primacy because of its higher public purpose. Section 26 of SICA bars the jurisdiction of the civil Courts.
32. What scheme should be prepared by the operating agency for revival and rehabilitation of the sick industrial company is within the domain of BIFR. Section 26 not only covers orders passed under SICA but also any matter which BIFR is empowered to determine.
33. The jurisdiction of civil court is, thus, barred in respect of any matter for which the appellate authority or the Board is empowered. The High Court may not be a civil court but its jurisdiction in a case of this nature is limited."
89. From the above judgments of this Court, the unambiguous principle of law that emerges is that the provisions of SICA 1985 shall normally override the other laws except the laws which have been specifically excluded by the Legislature under Section 32 of SICA 1985. SICA 1985 has been held to be a special statute vis-à-vis the other laws, most of which have been indicated above. In the present case, we are concerned with the provisions of TPA 1882.
23. Similar view has been taken in the case of Amardeep Association Vs. Dakshin Gujrat: 2010GLH(3)431, wherein it was held thus:
"14. Mr. Pandya has further submitted that Navsari Cotton and Silk Mills Limited had closed its unit on failure to comply with the sanctioned Scheme of BIFR, and relief and concession availed from Govt. of Gujarat. For revival of the unit, the workers Industrial Cooperative Society submitted a draft for rehabilitation Scheme before BIFR through the Navsari Cotton and Silk Mills Limited in July 1994. Due to non-payment of outstanding dues of GEB, notice for temporary disconnection and agreement termination (Downloaded on 28/06/2019 at 01:29:01 AM) was issued to M/s. Navsari Cotton and Silk Mills Limited on 07.10.1994. The connection was permanently disconnected on 05.10.1995. The net outstanding dues were of Rs. 416.36 Lacs after adjustment of security deposit of Rs. 2.46 Lacs on the date of permanent disconnection."
24. The opinion aforesaid has also been reiterated in the case of Ghanshyam Sarda Vs. Shiv Shankar Trading Company (2015) 1 SCC 298, wherein the Supreme Court, held thus:
"25. We may also at this stage deal with submission regarding effect of order dated 29.08.2014 of the Civil Court impleading the present Appellant as Defendant. Confining itself to the question of competence of the present Appellant to file the appeal without leave of the court, the High Court had not dealt with legal issues, namely what shall be the effect of Sections 22, 26 and 32 of the Act insofar as the present controversy is concerned. It was therefore submitted on behalf of the company that since the Appellant now stands impleaded, he be left to pursue appropriate remedies before the Trial Court. We are not persuaded to agree with this submission to relegate the matter to the Trial Court and we proceed to deal with the legal issues involved in the matter inasmuch as the matter raises basic issues concerning jurisdiction of the Civil Court itself. The learned Counsel appearing for the Original Plaintiff as well as the company have also advanced submissions on the legal issues in question and we therefore deem it appropriate to deal with such issues.
26. At this juncture the question regarding maintainability of the appeal before the High Court needs to be dealt with. As the facts indicate, FAO was admitted after hearing the Respondents. Neither at that stage nor at any subsequent stage anything was filed by way of formal opposition to the filing of such appeal without the leave of the Court. Further the status of the present Appellant to present his point of view in the form of proposal or scheme before the BIFR was accepted right up to this Court and he had (Downloaded on 28/06/2019 at 01:29:01 AM) thereafter been represented before the BIFR. The proceedings dated 04.04.2013 also indicate that the BIFR was in seisin of MA No. 162 of 2012 preferred by him. He was also impleaded as Respondent in the writ petitions which were dealt with along with the said FAO. The present Appellant was thus not a stranger to the controversy. There is nothing in Order XLIII Rule 1 of the Code of Civil Procedure that leave to appeal has to be applied for in any particular format. In the circumstances, the High Court was not justified in dismissing the appeal on a technical ground and it ought to have considered the merits of the matter. We hold the appeal preferred by the present Appellant to be maintainable and proceed to consider the basic issues involved in the matter.
24. Sections 22(1), 26 and 32(1) of the Act, the ambit and scope of which fall for our consideration are quoted hereunder:
22. Suspension of legal proceedings, contracts, etc.--
1) Where in respect of an industrial company, an inquiry Under Section 16 is pending or any scheme referred to Under Section 17 is under preparation or consideration or a sanctioned scheme is under implementation or where an appeal Under Section 25 relating to an industrial company is pending, then, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956), or any other law or the memorandum and articles of association of the industrial company or nay other instrument having effect under the said Act or other law, no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof and no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company shall lie or be proceeded with further, except with the consent of the Board or, as the case may be, the Appellate Authority.(Downloaded on 28/06/2019 at 01:29:01 AM)
26. Bar of Jurisdiction--No order passed or proposal made under this Act shall be appealable except as provided therein and no civil court shall have jurisdiction in respect of any matter which the Appellate Authority or the Board is empowered by, or under, this Act to determine and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.
32. Effect of the Act on other laws.--(1) The provisions of this Act and of any rules or schemes made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law except the provisions of the Foreign Exchange Regulation Act, 1973 (46 of 1973) and the Urban Land (Ceiling and Regulation) Act, 1976 (33 of 1976) for the time being in force or in the Memorandum or Articles of Association of an industrial company or in any other instrument having effect by virtue of any law other than this Act.
27. Chapter III of the Act details out various stages at which inquiry into the working and status of sick industrial companies and the scheme for revival is undertaken. Upon a reference to the Board or upon information received with respect to financial conditions of any industrial company, the Board is empowered Under Section 16 to conduct such inquiry as it may deem fit for determining whether such company has become a sick industrial company. After being so satisfied, the measures which could be taken up to enable the company to make its net worth exceed the accumulated losses that is to say to make it positive are postulated in Section 17. Under Section 17(1) the Board may by order in writing allow an industrial company to revive itself, if it is practicable so to do within a reasonable time. If it is not so practicable, it may direct any operating agency to prepare a scheme for the revival of such company. In other words, once the reference is registered, it is the BIFR which supervises the aspects leading to the revival of such company. Subsequent sections deal with the preparation and sanction of scheme for revival of such company and (Downloaded on 28/06/2019 at 01:29:01 AM) empower the Board to have dominion over such company to enable the revival of that Company and in cases where such revival is not possible, to recommend the winding up of such company. It is clear that after a reference is registered by the Board, all throughout the subsequent stages, the BIFR has complete supervisory control over the affairs of such company till it is revived or the decision to wind up such company is taken. In our view, the ambit and extent of such control means and includes determination of such measures to achieve revival of the sick company and to check whether by such measures the revival is being achieved or not. This must cover the power to decide at any stage subsequent to the registration of reference Under Section 16 whether such company has ceased to be sick company or not. Cessation of the status as a sick company can be Under Section 17(1) or as a result of scheme for revival being implemented and determination of such issue, in our view, is in the exclusive domain of the BIFR."
25. Similar view has again been affirmed in the case of Director General of Income Tax (Admin) and Another Vs BIFR and Ors. (2012) 171 Comp Case 147, wherein it was held thus:
"12.We have to keep in mind that any scheme is a package to rehabilitate the company. It is possible that such rehabilitation may result in early success or at times may take a greater period of time to achieve financial stability. If the argument of the Department were to be accepted it would imply that if a sick industrial company achieves success in making its net worth positive, all benefits of a sanctioned scheme would stand withdrawn whether exhausted or not, even though the emergence from sickness, and its continued health is dependent on the sanctioned scheme being fully implemented. This would, according to us, defeat the very purpose of formulating a sanctioned scheme. A sanctioned scheme in myriad ways would ordinarily devise ways and means by which the assets of the referrer are to be dealt with. The provisions of the sanctioned scheme would bind both the referrer and those who are party to it, including those in respect of which SICA makes a specific provision. It has to be appreciated that to forge a consensus on rehabilitation of a sick industrial company is no mean task. But once consensus is arrived at, and a scheme is sanctioned, (Downloaded on 28/06/2019 at 01:29:01 AM) it cannot equally be jettisoned without due deliberation and adherence to the provisions of law. Thus, the apprehension of the Department that assets will be salted away is misconceived. The company which is the beneficiary of the sanctioned scheme can be brought to heel by taking recourse to appropriate remedies in order to obtain its obeisance to the sanctioned scheme.
13. We may also note that the mere fact that the net worth has become positive does not provide an automatic exit route from the proceedings before the BIFR. It is open to the BIFR to continue to monitor the implementation of the unimplemented part of the sanctioned scheme. In the captioned cases, the BIFR appears to have discharged the reference solely on the ground that the net worth had turned positive. The discharge of reference is followed by consequent directions of relieving the operating agency and the independent director, of its mandate. The BIFR has noticed that a substantive part of the sanctioned scheme has been implemented, while issuing a direction to implement the remaining part of the sanctioned scheme. If one may say so, the second part is really redundant since, as observed above by us, once a scheme is sanctioned it has the force of law; making its enforcement amenable as a matter of law, even in foras other than BIFR. We may emphasise at the cost of repetition that gaining entry within the domain of BIFR, the erosion of net worth (amongst other jurisdictional attributes) is an essential criteria; the inverse does not necessarily follow. In other words a referrer cannot seek an exit as a matter of right merely on the ground that net worth has turned positive, especially where a sanctioned scheme is under implementation. This is a call that the BIFR has to take. Where the BIFR takes such a call by discharging the reference, it does impact the sanctity of a sanctioned scheme which continues to bind all concerned."
26. Learned counsel for the petitioner has placed reliance on the opinion in the case of Commissioner of Custom (Import), Mumbai Vs. Dilip Kumar and Company and Ors. (2018) 9 SCC 1, wherein the Supreme court dealt with the ambiguity as to the whether the company importing goods shall fall within the ambit of the goods given benefit under Custom Notification No. 20/1999 or not ? And the apex court of the land, held thus: (Downloaded on 28/06/2019 at 01:29:01 AM)
"40. The aforesaid placitum is suggestive of the fact that the Courts utilized the Rule of strict interpretation in order to decipher the intention of the Legislature and thereafter provide appropriate interpretation for the exemption provided under the provisions of the Act which was neither too narrow nor too broad. It may be noted that the majority did not take a narrow view as to what strict interpretation would literally mean; rather they combined legislative intent to ascertain the meaning of the statute in accordance with the objective intent of the Legislature.
41. On the contrary, the minority opinion of Justice B.P. Sinha (as His Lordship then was) provided a purposive interpretation for Section 5(2)(a)(iii) of the Act, which is clear from the following passage:
"24. ...... The judgment under appeal is based chiefly on the consideration that the exemption Clause in question does not in terms refer to the newly created department which now goes by the name of the Ministry of Industry and Supply. But this department in so far as it deals with industry, is not concerned with the main purchasing activities of the Government of India. The exemption was granted in respect of the purchasing activity of the Government of India and that function continues to be assigned to the Supply Department which has now become a wing of the newly created department of the Government. The question therefore arises whether in those circumstances the Government of India could claim the benefit of the exemption. The High Court in answering that question in the negative has gone upon mere nomenclature. It has emphasized the change in the name and overlooked the substance of the matter."
52. After considering the various authorities, some of which are adverted to above, we are compelled to observe how true it is to say that there exists unsatisfactory state of law in relation to interpretation of exemption clauses. Various Benches which decided the question of interpretation of taxing statute on one hand and exemption notification on the other, have broadly assumed (we are justified to say this) that the position is well settled in the interpretation of a taxing statute: It is the law that any ambiguity in a taxing statute should enure to the benefit of the subject/assessee, but any ambiguity in the exemption Clause of exemption notification must be conferred in favour of revenue-and such exemption should be allowed to be availed only to those subjects/assesses who (Downloaded on 28/06/2019 at 01:29:01 AM) demonstrate that a case for exemption squarely falls within the parameters enumerated in the notification and that the claimants satisfy all the conditions precedent for availing exemption. Presumably for this reason the Bench which decided Surendra Cotton Oil Mills Case (supra) observed that there exists unsatisfactory state of law and the Bench which referred the matter initially, seriously doubted the conclusion in Sun Export Case (supra) that the ambiguity in an exemption notification should be interpreted in favour of the Assessee."
27. But the factual matrix in the case at hand, is entirely different and distinguishable, and hence, the view in the case referred to and relied upon, aforesaid; is not relevant for adjudication in the matters at hand.
28. Similarly, in the case of State of Uttar Pradesh and Another Vs. Mahindra and Mahindra Limited (2011) 13 SCC 77, it was held thus:
"10. Within our Constitution, we have specifically demarcated the ambit of power and the boundaries of the three organs of the Society by laying down the principles of separation of powers, which is being adhered to for carrying out democratic functioning of the country. So far as the legislation is concerned, the exclusive domain is with the legislature. Subordinate legislations are framed by the executive by exercising the delegated power conferred by the Statue, which is rule making power. The judiciary has been vested with the power to interpret the aforesaid legislations and to give effect to them since the parameters of the jurisdiction of both the organs are earmarked. Therefore, it is always appropriate for each of the organs to function within its domain. It is inappropriate for the courts to issue a mandate to legislate an Act and also to make a subordinate legislation in a particular manner. In this particular case, the High Court has directed the subordinate legislation to substitute wordings in a particular manner, thereby assuming to itself the role of a supervisory authority, which according to us, not a power vested in the High Court.
11. It is also by now settled law that so far exemption clauses are concerned, there should be strict interpretation of the same as has been held by this Court (Downloaded on 28/06/2019 at 01:29:01 AM) repeatedly. Suffice will be to refer to very recent decisions of this Court in Bhai Jaspal Singh and Anr. v. Assistant Commissioner of Commercial Taxes and Ors. and Commissioner of Central Excise, New Delhi v. Hari Chand Shri Gopal and Ors. We would also extract a passage from the decision of the Supreme Court in Novopan India Ltd. Hyderabad v. Collector of Central Excise and Customs, Hyderabad reported at MANU/SC/1216/1994 : 1994 Supp (3) SCC 606, wherein this Court has held that:
16. ...such a notification has to be interpreted in the light of the words employed by it and not on any other basis.
This was so held in the context of the principle that in a taxing statute, there is no room for any intendment, that regard must be had to the clear meaning of the words and that the matter should be governed wholly by the language of the notification i.e. by the plain terms of the exemption."
12. During the course of the arguments, it was also brought to our notice that subsequent to the order of assessment, an appeal was filed, which came to be dismissed, subsequent to which a second appeal was filed before the Tribunal, which allowed the appeal giving effect to the orders of the High Court. Since, in our considered opinion, the High Court exceeded its jurisdiction in passing the aforesaid orders and in issuing the directions for inserting certain additional words into notification of exemption issued by the Uttar Pradesh Government, we set aside the impugned judgment and order passed by the High Court and also the order passed by the Tribunal. As the Tribunal had given effect to the order of the High Court, the order of the Tribunal is hereby set aside. Even otherwise Courts can always take notice of the subsequent events and developments that had taken place subsequent to the filing of the writ petition or filing of the special leave petition and it is also within the jurisdiction of this Court to pass consequential orders to give effect to the remedies available to the parties.
13. Considering these facts and circumstances from the aforesaid angle, we after setting aside the order passed by the High Court and also by the Tribunal as also by the First Appellate Court, remit back the matter to the First Appellate Court to consider the matter de novo taking into consideration the notification as existing and which was issued on 12th September, 1986, and decided the matter without making any addition/alternation thereto. (Downloaded on 28/06/2019 at 01:29:01 AM)
14. However, counsel appearing for the Respondent has submitted before us that it would be possible for the Respondent to prove and establish that the tractor manufactured by the Respondent is below 25 PTOHP. If certain exemption is available on the factual aspect, such benefit must be provided to an Assessee but that is possible only when the Respondent is able to prove and establish with cogent and reliable materials that he is entitled to the benefit of the exemption notification. Therefore, we allow the parties to lead additional evidence before the appellate authority, which shall be allowed to be filed within four weeks from their date of appearance and, thereafter, the appellate authority shall proceed to decide the matter de novo in the light of the records available and also in the light of the exemption notification."
29. In the case herein above again, the question was to the ambiguity in the exemption clause; thus, the precedent is not relevant with the controversy in the matters at hand.
30. Applying the principles deducible for the opinions referred to hereinabove, this Court is of the view that the respondent- Company shall not be liable to pay the balance tax and interest as assessed and imposed by the Assessing Officer, taking note of condition number 7 of the Notification dated 29 th May, 2003, for in view of directed issued by the BIFR vide its order dated 24 th May, 2007, would render the said condition void.
31. For the reasons and discussions aforesaid and in view of the singular factual matrix of the matters at hand; the revision petitions instituted by the petitioner fail and are hereby dismissed.
32. Costs made easy.
A copy of this order be placed in each of the file.
(VEERENDR SINGH SIRADHANA),J pcg (Downloaded on 28/06/2019 at 01:29:01 AM) (Downloaded on 28/06/2019 at 01:29:01 AM) Powered by TCPDF (www.tcpdf.org)