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The Commissioner Trade Tax v. S/S. Durga Gallas Bhandar, Deoria - SALES/TRADE TAX REVISION DEFECTIVE No. 1560 of 1998  RD-AH 4162 (6 October 2005)
TRADE TAX REVISION NO.(1560) of 1998.
The Commissioner, Trade Tax, U.P., Lucknow. Applicant
S/S Durga Galla Bhandar, Deoria. Opp.Party.
Hon'ble Rajes Kumar, J.
Present revision under Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act") is directed against the order of Tribunal dated 20th March, 1998 relating to the assessment year 1988-89.
The short question relates to the taxability on the purchase of rice bran by the dealer/opposite party (hereinafter referred to as "dealer").
Brief facts of the case are that during the year under consideration, the dealer had purchased rice bran for Rs.11, 77,269/- from unregistered dealer and had sold against Form 3-B to the dealers holding recognition certificate under section 4-B of the Act being solvent extraction plant. Dealer claimed exemption on such purchase of rice bran on the ground that they have been sold to the dealer holding a recognition certificate under section 4-B of the Act against Form 3-B. Assessing authority rejected the claim of exemption on the purchases. First appeal filed by the dealer was rejected. Tribunal by the impugned order allowed the appeal following the decision of the Tribunal in the Case of M/S Malti Devi, Deoria and allowed the exemption on the purchases.
Heard Sri B.K. Pandey, learned Standing Counsel and Sri Piyush Agrawal, learned counsel for the dealer/opposite party.
Learned Standing Counsel submitted that the order of the Tribunal in the case of S/S Malti Devi has been reversed by this Court in the case of CTT Versus S/S Malti Devi, Deoria reported in 2000 UPTC 294. He further submitted that the rice bran is liable to tax at the point of first purchase under the notification issued under section 3-D (1) of the Act. He further submitted that rice bran is not a declared commodity, therefore, provision of Section 4-B (1), (a-1) of the Act is not applicable and for availing the benefit of concessional rate of tax or exemption under section 4-B (1) (a) of the Act, it is necessary that the dealer must hold recognition certificate under section 4-B of the Act, but admittedly, the present dealer was not holding any recognition certificate under section 4-B of the Act and, therefore, the benefit of exemption was not available. Learned counsel for the dealer relied upon the order of the Tribunal.
Section 4-B (1) (a) and (a-1) of the Act reads as follows.
"Section 4-B. Specific relief to certain manufacturers.
(1) Notwithstanding anything contained in Sections 3, 3-A, 3-AAAA and 3-D.
(a) Where any goods liable to tax under sub-section (1) of section 3-D are purchased by a dealer who is liable to tax on the turnover of first purchases under that sub-section, or where any goods are purchased by any dealer in circumstances in which such a dealer is liable to purchase tax in respect thereof under section 3-AAAA and the dealer holds a recognition certificate issued under sub-section (2) in respect thereof, he shall be liable in respect of those goods to tax at such concessional rate, or be wholly or partly exempt from tax, whether unconditionally or subject to the conditions and restrictions specified in that behalf, as may be notified in the Gazette by the State Government in that behalf:
(a-1) Where any declared goods liable to tax under sub-section (1) of Section 3-D are sold or supplied by a dealer, who is the first purchaser thereof, to another dealer, holding a valid recognition certificate issued under sub-section (2) in respect thereof, the dealer who made the first purchase shall in respect of such purchase and subject to such conditions and restrictions as may be specified by notification in that behalf, be exempt from tax or be liable to tax at such concessional rate as may be notified by the State Government:
Provided that any notification under this clause or clause (a) in respect of paddy may be made effective from a date not earlier than the first day of May, 1977:
Provided further that the rules to carry out the objects of this clause or clause (a) may also be made effective from the date not earlier than the first day of May, 1977."
Section 4-B (1), (a-1) of the Act is applicable to a declared commodity only. Admittedly, rice bran is not a declared commodity under section 14 of the Central Sales Tax Act, therefore, the benefit of Section 4-B (1), (a-1) of the Act cannot be availed. Section 4-B (1) (a) of the Act provides benefit to those dealer only who holds recognition certificate under section 4-B (2) of the Act. Admittedly, the present dealer is not holding any recognition certificate under section 4-B (2) of the Act and, therefore, the benefit of the concessional rate of tax or exemption is not eligible to the dealer under section 4-B (1) (a) of the Act. Thus, the Tribunal has illegally allowed the benefit of concessional rate of tax under section 4-B (1), (a-1) of the Act without looking into the provision that it is applicable to the declared commodity only and not to the rice bran which is a not declared commodity.
In the result, revision is allowed. Order of the Tribunal is set aside.
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