Tax concession under exemption scheme may be partially availed; rectification cannot reopen a debatable interpretation.

An eligible industrial unit under the Rajasthan Sales Tax exemption scheme could voluntarily forgo or partly avail the concessional benefit on specific sales, because the exemption limit operated as a maximum concession and not a compulsory minimum. Tax collected at the concessional rate on sales to the Rajasthan State Electricity Board, and deposited with the Government, was not unauthorised within the scheme, so forfeiture and penalty were not attracted. Rectification under section 17 was limited to an error apparent from the record and could not be used to reopen a debatable interpretation of the exemption scheme. The section 17 notices and resulting proceedings were therefore without jurisdiction.

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Issues: Whether the sales tax exemption scheme barred collection of tax at the concessional rate on sales to the Rajasthan State Electricity Board, whether such collection reduced the eligible exemption or attracted forfeiture and penalty, and whether rectification proceedings under section 17 of the Rajasthan Sales Tax Act, 1954 could be invoked on that basis.

Analysis: The scheme under section 4(2) of the Rajasthan Sales Tax Act, 1954 conferred a concession on eligible industrial units and the exemption limit was a maximum, not a compulsory minimum. The dealer could choose whether to avail the concession on particular sales, and where tax was contractually charged at 4 per cent on sales to the Rajasthan State Electricity Board under the State Government notification, such collection was not unauthorised. Section 5G applied only where tax was collected on goods on which no tax was payable by virtue of section 4, and the goods here were not exempt goods. Since the collection was within the concessional framework and the tax was deposited with the Government, there was no basis for forfeiture or penalty. In any event, section 17 was confined to rectification of an error apparent from the record and could not be used to reopen the assessments on a debatable interpretation of the scheme.

Conclusion: The notices issued under section 17 and the consequential proceedings were without jurisdiction and could not be sustained.

Ratio Decidendi: An eligible industrial unit may voluntarily forgo or partially avail a tax concession under an exemption scheme, and collection of tax within the terms of the governing notification does not attract forfeiture, penalty, or rectification unless a clear error apparent from the record exists.

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