Tax exemption under one enactment does not bar cess recovery under another, especially where relied-on precedent is stayed.

An exemption granted under the Package of Incentives, 1992 and reflected in the Punjab General Sales Tax Act, 1948 did not extend to cess levied under section 12 of the Punjab Dairy Development Board Act, 2000, because the two levies arose under distinct enactments. The earlier tax exemption therefore did not bar recovery of the separate statutory cess. A Division Bench judgment relied on by the petitioner could not be used to quash the notices and recovery certificate because its operation had been stayed by the Supreme Court. The challenge to cess recovery accordingly failed.

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Issues: (i) Whether exemption from tax granted under the Package of Incentives, 1992 and reflected under the Punjab General Sales Tax Act, 1948 protected the petitioner from cess levied under section 12 of the Punjab Dairy Development Board Act, 2000; (ii) Whether the impugned notices and recovery certificate could be quashed on the basis of an earlier Division Bench judgment whose operation had been stayed by the Supreme Court.

Issue (i): Whether exemption from tax granted under the Package of Incentives, 1992 and reflected under the Punjab General Sales Tax Act, 1948 protected the petitioner from cess levied under section 12 of the Punjab Dairy Development Board Act, 2000.

Analysis: The exemption granted to the petitioner was confined to tax under the Punjab General Sales Tax Act, 1948 for the specified period. The cess sought to be recovered was levied under a distinct enactment, namely section 12 of the Punjab Dairy Development Board Act, 2000. The grant of exemption from one levy did not extinguish liability to pay another statutory cess, and there was no material to show that the earlier exemption had been withdrawn or that recovery under the 1948 Act had been revived.

Conclusion: The exemption did not bar recovery of cess under the Punjab Dairy Development Board Act, 2000.

Issue (ii): Whether the impugned notices and recovery certificate could be quashed on the basis of an earlier Division Bench judgment whose operation had been stayed by the Supreme Court.

Analysis: The petitioner relied on an earlier Division Bench decision striking down the levy, but the operation of that judgment had been stayed by the Supreme Court. In view of the stay, the respondents were entitled to proceed with recovery under the 2000 Act, and the challenge based on that judgment could not succeed.

Conclusion: The stayed judgment did not furnish a valid ground to quash the recovery action.

Final Conclusion: The challenge to the cess recovery failed, and the writ petition was dismissed.

Ratio Decidendi: An exemption from one statutory tax cannot be extended to a separate cess imposed under another enactment, and a judgment whose operation has been stayed by the Supreme Court cannot be relied upon to defeat recovery proceedings.

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