Declaration forms cannot be refused on merits where concessional sales tax entitlement is reserved for assessment.

Concessional sales tax entitlement could not be determined at the stage of issuing declaration forms unless the statute expressly authorised such prior adjudication. The Court held that issuance of form IB was a regulatory step and did not itself decide whether the goods were basic raw materials or whether the assessee qualified for the industrial policy concession under entry 26-D; those matters were reserved for assessment. By refusing the forms on merits, the authorities exceeded their lawful scope. The refusal was therefore unlawful, and the assessee was entitled to the declaration forms, subject to any separate statutory safeguards for revenue protection.

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Issues: Whether the sales tax authorities could refuse to issue declaration forms in form IB by adjudicating, at the stage of issuance, whether the goods proposed to be purchased were basic raw materials and whether the assessee was entitled to the concessional benefit under the industrial policy and entry 26-D.

Analysis: The concession under the relevant sales tax notification operated on raw materials directly going into the composition of the finished products, and the procedure for obtaining and resupplying declaration forms was regulatory in character. Mere issuance of the form did not determine entitlement to concessional tax treatment, which was a matter for assessment unless the statute expressly required prior adjudication. The authorities therefore travelled beyond the legal scope of their power by deciding, at the form-issuing stage, that the goods were not basic raw materials. If revenue protection was necessary, the statute provided separate safeguards, including demand and forfeiture of reasonable security in appropriate cases.

Conclusion: The refusal to issue form IB was unlawful, and the assessee was entitled to the declaration forms.

Ratio Decidendi: Entitlement to concessional sales tax treatment cannot be adjudicated at the stage of issuing declaration forms unless the statute expressly so provides, and the issuing authority may not deny forms on merits where the question is reserved for assessment.

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