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M/s Gupta Chemical Company v. The Commissioner of Sales Tax - SALES/TRADE TAX REVISION No. 1152 of 1992 [2003] RD-AH 421 (3 November 2003)


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M/s Gupta Chemical Company ....Applicant


The Commissioner of Sales Tax ....Opp.Party



M/s Gupta Chemical Company ....Applicant


The Commissioner of Sales Tax ....Opp.Party



M/s Gupta Chemical Company ....Applicant


The Commissioner of Sales Tax ....Opp.Party


Hon'ble Rajes Kumar, J.

These are three revisions under Section 11 of the U.P. Sales Tax Act (hereinafter referred to as "Act") relating to the assessment years 1980-81, 82-83 (Central) and 83-84 giving rise to common dispute. Hence the same are being decided together.

The applicant was carrying on the business of potashium chlorate. The claim of the applicant was that potashium chlorate was chemical fertilizer and liable to tax @ 5%. For all the aforesaid assessment years, assessing authority had accepted the claim and assessed potachium chlorate as fertilizer.  Subsequently, for the assessment year 1980-81 under Section 21 of the Act reassessment order was passed and potachium chlorate had been assessed as a chemical.  For the assessment year 1982-83 and 83-84, proceeding under Section 10-B of the Act was initiated by Deputy Commissioner (Executive) Sales Tax, Meerut and an order was passed, in which potachium chlorate was treated as chemical. Against the order passed under Section 21, applicant filed appeal before Assistant Commissioner (J) Sales Tax, Meerut, which was rejected and thereafter, second appeal was filed before Tribunal. Against the order passed under Section 10-B of the Act for the assessment years 1982-83 and 83-84 applicant filed appeals before the Tribunal. Tribunal had rejected all the appeals vide order-dated 30.04.1992. Being aggrieved by the order of Tribunal, applicant has filed the present revisions.

Heard Sri R.R. Agrawal, learned counsel for the applicant and learned Standing Counsel.

Learned counsel for the applicant has contended that in the case of applicant itself for the assessment year 1974-75, in the proceedings under Section21 Tribunal has held potachium chlorate as chemical and the applicant filed revision before this Court. This Court vide order dated 02.11.1992 allowed the revision and remanded back the case to Tribunal to decide the appeal afresh. While remanding back the case, this Court has given the following directions to Tribunal:

"The Tribunal is therefore, directed to decide the following aspects of the case before holding that the applicant is not entitled to treat the potassium chlorate as chemical fertilizer:

(1) Whether the Pottassium Chlorate can be used as chemical fertilizer even if it is not included as one of the items under the Fertilizer Control Order, 1985.

(2) Whether there is a provision under any law prohibiting use of Pottassium Chlorate as chemical fertilizer and if such sale is made to use it as fertilizer, can it be treated as illegal.

(3) Whether the use of Pottassium Chlorate as fetilizer in absence of any mention of such item in the Fertilizer Control Order, 1985, will be treated as illegal and the same shall be taken as implied prohibition under law.

In case the Pottassium Chlorate is used as a chemical fertilizer and there is no provision in law prohibiting its use as fertilizer, the mere fact that it is not mentioned as one of the items of fertilizer under the Fertilizer Control Order 1985, shall not affect the rights of the applicant to sell it as chemical fertilizer and the applicant shall be entitled to treat it as chemical fertilizer if sold to farmers for the purpose of assessment and sales tax under the provisions of the U.P. Sales Tax Act."

Learned counsel for the applicant states that as per his information appeal is still pending and has not yet been decided. He further submitted that for the assessment years 1981-82, 85-86 and 86-87 Tribunal has accepted the claim of the applicant and held potashium chlorate as chemical fertilizer.  In the circumstances, he submitted that the order of Tribunal is erroneous and is liable to be set aside.  In view of the fact that this Court in the case of applicant has remanded back the case to Tribunal with certain directions. It would be appropriate that the matter may be remanded back to the Tribunal to decide present appeals in the light of same observations. It will be open to the Tribunal to consider any other argument raised by the applicant and further evidences adduced by the dealer as well as by the department to decide the issue involved.

In the result, all the three revisions are allowed. Order of Tribunal dated 30.04.1992 are set aside and Tribunal is directed to decide the appeal nos.119 of 1987, 414 of 1986 and 8 of 1990 afresh in the light of the observations made above. Since the matter is quite old, Tribunal may decide the appeals expeditiously.




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