TaxTMI 
TaxTMI 
2010 (9) TMI 881
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....ect interpretation of construction of Note (i) to Schedule III under clause 2(i) of the Haryana Rice Procurement Levy Order, 1985 (hereinafter referred to as, "the Levy Order"), the appellants/dealers had collected purchase tax on paddy from the Government or its agencies along with procurement price of levy fixed under the said Levy Order and if so, what would be the effect of such collection. There is a second issue which arises for our consideration, i.e., as to whether the State is empowered to recover certain amounts as purchase tax in light of the scheme envisaged under the Haryana General Sales Tax Act, 1973 (hereinafter referred to as, "the Act") and also keeping in view that no sales tax was paid, as payment of the same was specifically excluded. The appellants-companies are engaged in the business of purchase of paddy and manufacture of rice therefrom. The assessees are registered under the Haryana General Sales Tax Act, 1973 (hereinafter referred to as, "the Act") and also under the Haryana Value Added Tax Act, 2003. The assessees were granted exemption from the payment of sales tax under rule 28A of the Haryana General Sales Tax Rules, 1975 (hereinafter referred t....
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....ch entitles the unit to avail of exemption from the payment of sales or purchase tax or both, as the case may be." It is the case of the appellants that since there was a difference between the original section 13B of the Act as inserted on September 8, 1988, and rule 28A(2)(k) of the Rules, section 13B was subsequently amended by deleting the word "sales" and consequently the new section reads as under: "Powers to exempt certain class of industries.-The State Government may, if satisfied that it is necessary or expedient so to do in the interest of industrial development of the State, exempt such class of industries from the payment of tax, for such period and subject to such conditions as may be prescribed." Relying on the said amendment, the learned counsel appearing for the appellants submitted that by use of the word "tax" instead of the words "sales tax", the Legislature intended to declare that the exemption was available on both sales as well as purchase tax. It is interesting to note that while the Act and the Rules were so amended, due to a legislative omission, the statutory forms ST-72 and ST- 73 relating to grant of exemption remained unchanged. Eligibility....
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.... any point of time. We have already referred to the aforesaid note appended to the notification dated October 17, 1996. The aforesaid note leaves no room for doubt that the assessees, while supplying rice to DFSC, collected purchase tax amongst other things by way of the procurement price. Since they had collected the purchase tax, they were required to deposit the same in the Government exchequer and there could be no justification for them to retain the purchase tax and appropriate the same to their own use. Retention of such purchase tax collected by the appellant amounts to unjust enrichment which is not permissible in view of the law laid down by the Constitution Bench of this court in the case of Mafatlal Industries Ltd. v. Union of India [1998] 111 STC 467 (SC). reported in [1997] 5 SCC 536. This court in the said case held as under at page 605 of 111 STC. : "254 at page 123 of STC.. . . . The excise officer cannot tax more than what is permitted by the statute. If the levy is in excess of the statute, then its retention by the State is unauthorised by law. What is being retained is not in enforcement of the charging section but something else. Such illegally co....
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.... A reference may also be made to a decision of the Constitution Bench in Godfrey Phillips India Ltd. v State of U.P.[2005] 139 STC 537 (SC). reported at [2005] 2 SCC 515. In that case, the Constitutional validity of the Uttar Pradesh Tax on Luxuries Act, 1995 as also other State Acts was challenged, inter alia, on the ground of legislative competence of the State Legislatures. The court allowed the petition and held that the State Legislatures were not competent to impose luxury tax on tobacco and tobacco products and the Acts were declared ultra vires and unconstitutional. In the intervening period, however, tax was collected by the appellants from consumers and also paid to the State Governments. In certain cases, interim relief was obtained by the appellants from this court against recovery of tax and as alleged by the State Governments, the appellants continued to charge tax from consumers/customers. The court held At page 576 of 139 STC.: "It was stated on behalf of the State Governments that after obtaining interim orders from this court against recovery of luxury tax, the appellants continued to charge such tax from consumers/customers. It is alleged that they did no....