TaxTMI 
TaxTMI 
2014 (5) TMI 176
X X X X Extracts X X X X
X X X X Extracts X X X X
....lic Sector Undertaking Oil Companies to the Director of Fisheries, Government of Tamil Nadu, for distribution to the fishermen in Tamil Nadu not exceeding the quantity indicated thereunder. 3. As per the Government Order, Fishermen having mechanized boats were entitled to a maximum supply of fifty thousand kilo liters per annum and fishermen having country boats fitted with diesel engines were entitled to a maximum supply of forty five thousand six hundred kilo litres per annum. Few other conditions were imposed in the Government Order of which condition (b) and (d) are significant. Condition (b) stipulates that the Director of Fisheries shall authorize the Public Sector Undertaking Oil Companies for supply of Diesel to fishermen of Tamil Nadu through Diesel Bunks of Tamil Nadu Fisheries Development Corporation (TNFDC), Tamil Nadu State Fishermen Cooperative Federation (TAFCOFED) and other private diesel bunks authorized by the Director of Fisheries. Condition (d) stipulates that the Director of Fisheries shall issue a declaration for the purchase of Diesel for distribution to Fishermen of Tamil Nadu to the Public Sector Undertaking Oil Companies every month. 4. On the very same ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....would be given to TNFDC and TAFCOFED in the proposed new places and that private bunks selected will not be allotted more than 10% of the total quota eligible for that area. 10. Further, the Committee also stated that the selection of private outlets will be purely on temporary basis and will be valid for a period of one year only and the allotment of private diesel outlet under this scheme is subject to termination whenever TNFDC and TAFCOFED desire to open new bunks in that area. While concluding the Committee observed that additional places will be considered within the limits prescribed in the Government Order as per the norms fixed at above after studying the above proposed bunks for a reasonable period and the local needs. 11. The Writ Petitioners are private operators from Mallipattinam Thanjavur District, Thonithurai Road, Nagapattinam and Mandapam Ramanad District and they filed Writ Petitions seeking equal supply on par with the outlets operated by TNFDC and TAFCOFED alleging that the indent raised to their outlets were falling short of the demand and alleged that the actions of the second appellant is arbitrary, discriminatory and the same is against Article 14 and 19 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....upply the demanded quantity without discrimination if the petitioners satisfy the requirements for supply and raise an indent for supply of diesel exempted from sales tax. As against the same, the present Writ Appeals have been preferred. 15. We have heard the learned Advocate General appearing for the appellants, the learned Additional Advocate General appearing for TNFDC, the learned Senior Counsel appearing for the Authorised Private Dealers and the learned counsel for the TNFDC and learned counsel for the Oil Corporation. 16. The learned Advocate General and the Additional Advocate General assailing the common order of the learned single Judge argued that the judgment of the Honble Apex Court was not rightly appreciated, and that the Government was empowered to impose any restriction. The learned Advocate General submitted that the supply would depend on the area where the bunk is located, and that, the findings of the Committee in proceedings dated 12.05.2005 was to ensure that the sale of the tax exempted diesel reaches the actual fishermen. The learned Advocate General also contended that when the sale is effected by the outlets operated by TNFDC and TAFCOFED, it would yi....
X X X X Extracts X X X X
X X X X Extracts X X X X
....reference to the circumstances relating to the trade or business in question. Canalisation of a particular business in favour of specified individual has been held reasonable by this Court where vital interests of the community are concerned or when the business affects the economy of the country (Parbhani Transport Coop. Society Ltd. vs. Regional Transport Authority [AIR 1960 SC 801]; Shree Mennakshi Mills Ltd. vs. Union of India [(1974) 1 SCC 468] and Lala Hari Chand Sarda vs. Mizo Distt. Council [AIR 1967 SC 829]). 35.In our view, the impugned circular does not offend Article 14 of the Constitution. The direction contained in the said circular cannot be held to be vitiated being arbitrary, capricious or unreasonable. The impugned circular specifically mentions that in order to implement the schemes introduced by the Government for streamlining specific roles and responsibilities of different agencies involved, the directions contained in the circular have been given. It has been placed on record that it was brought to the notice of the Agricultural Department of the State Government that false invoices had been issued by dealers without effecting actual sales with a view to dra....
X X X X Extracts X X X X
X X X X Extracts X X X X
....case of private dealership goes to private dealers and in case of Government Agency goes to the Government. 19. The learned Senior Counsel appearing for the Authorised Private Dealers submitted that the above judgments cannot be made applicable to the present facts as the right to seek exemption from sales tax on sale of diesel to fishermen has been granted to private authorised dealers on par with government outlets in the Government orders. The judgments would be applicable only if such right was not conferred in the Government orders and if the private dealers seek exemption to the sales made by them to fishermen. 20. In the present case, by G.O.Ms.No.170 and G.O.M.s.No.130, the Government has granted exemption from tax on sale of diesel to fishermen though outlets run by TNFDC, TAFCOFED and Authorised Private Dealers. There is no differentiation in the Government Order. The beneficiary under the Government Orders is the fishermen. If no exemption is granted, they have to purchase diesel at a higher rate. In both the Government Orders referred above, the exemption was also made applicable to Authorised Private Dealers. Therefore, any restriction at the point of supply can only....