TaxTMI 
TaxTMI 
2015 (11) TMI 260
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....pril, 1987. The Assistant Commissioner Sales Tax (Assessment), H-Ward, Unit II, Mumbai assessed the dealer on 31st March, 1993 for the above period under the B.S.T. Act. That resulted in refund of Rs. 27,91,770/-. The dealer was aggrieved by the assessment order in relation to reduction in set-off. According to the dealer, the set-off admissible under Rule 41D of the B.S.T Rules in respect of purchases of scientific equipments used for research and development in proportion of the branch transfers out of the State, levy of purchase tax under section 13AA in respect of the goods covered by Part-I of Schedule-C, levy of purchase tax under section 13 on purchases of vehicles and non-grant of set-off under this rule on purchases of cement used in the foundation of plant and machinery was erroneously refused. He preferred a First Appeal before the Deputy Commissioner of Sales Tax (Appeals), III Mumbai City, Division Mumbai. The First Appellate Authority dismissed the appeal by an order dated 3rd June, 1998. While deciding the appeal, the Appellate Authority reduced the set-off granted in the assessment order by Rs. 31,492/. In the opinion of this appellate authority set-off was wrongly ....
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....f goods for sale, then, this claim was allowable. The First Appellate Authority as also the Tribunal have failed to assign any reason for rejection of this claim. In that regard, our attention has been invited to the order passed by the First Appellate Authority. Our attention is also invited to the discussion in the Tribunal's order and which is to be found in paragraph 7. Mr Thakar complained that the Tribunal has granted similar benefit to M/s Ballarpur Industries Ltd, (Second Appeal No. 919 of 1994 decided on 7th August, 1999). If use was of cement was integrally connected with the manufacturing activity, then, the Tribunal should have found out as to which part of the cement was used in the manufacturing activity and, therefore, it was integrally connected therewith. Without making any inquiry of this nature and giving an opportunity to the dealer to prove its case, the Tribunal should not have maintained the order of the First Appellate Authority. 4. In relation to set-off under Rule 41D on purchases of scientific equipments and other materials which are used for research and development purpose, Mr Thakar would submit that the Tribunal has rendered conflicting orders an....
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....his Court cannot take into consideration such developments simply because a question of law will have to be answered by this Court on the language of the statute. It would not be bound by any act of parties and understanding of a legal provision by them. In the circumstances, no reliance can be placed on this inaction of the revenue. For these reasons, he would submit that the reference be answered accordingly. 7. Having noted the rival contentions the only question that we have to consider is whether under Rule 41D these claims were admissible. Rule 41D (1) with the Provisos would read as under:- Rule 41D. Drawback, set-off etc., of tax paid by a manufacturer in respect of purchases made on or after the notified day:- (1) In assessing the amount of tax payable in respect of any period by a Registered dealer who manufactures [goods] for sale or export (hereinafter in this rule referred to as "the claimant dealer") the Commissioner shall, in respect of purchases made by the claimant dealer on or after the notified day, of any goods specified [in entry 6 of Schedule B and in Schedule C] and used by him within the State:- (i) in the manufacture of [goods] [not being kerosene f....
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....e of the statute is plain, unambiguous and clear, there is no room for interpretation. The principles of statutory interpretation would come into play only if the plain language of a statute and about which there is no ambiguity leads to a construction which can be termed as absurd. The law frowns upon absurdity and does not attribute it to the legislature at all. It is only in that event that these principles can come into play. When a language is plain and ambiguous and admits of only one meaning no question of construction of a statute arises, for the Act speaks for itself. (State of U.P. vs. Vijay Anand Maharaj, AIR 1963 SC 946 at page 950. 9. In the present case, what Rule 41D provides for is a drawback, set-off of a tax paid by a manufacturer in respect of purchases made on or after the notified day. The language is that in assessing the amount of tax payable in respect of any period by a Registered dealer who manufactures goods for sale or export, the claimant/dealer can claim set-off and the Commissioner shall allow in respect of purchases made by such claimant dealer on or after the notified day, of any goods specified in entry 6 of Schedule 'B' and in Schedule &#....
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....off is admissible. Once it is found that the goods brought in are not used in the manufacture of goods for sale and which goods have in fact been sold by the dealer or exported by him or in the packing of the goods so manufactured, then, there was no scope for any such set-off. 11. Once both the First Appellate Authority and Second Appellate Authority, namely, the Tribunal as a final fact finding authority find that this expenditure is not of the nature and incurred on purchase of goods which have gone into the manufacture of the goods sold, then, we do not find any basis for referring a question and stated to be of law. The law does not envisage the above deduction. 12. Similarly, in the case of set-off under Rule 41D of purchase of cement the Tribunal as also the First Appellate Authority found that the cement may have been brought in and purchased for the purposes of strengthening the foundation of the manufacturing plant and the manufacturing plant may have been used in the manufacture of goods sold, still, the cement brought in was not used for such purpose. The cement was not used during the course of the manufacture of goods but substantial portion of this cement was used ....
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....any inaction of the Revenue or contrary view of the Tribunal. Mr Thakar does not contend that any view of the Tribunal and taken contrary to the one in the present case would have bearing on the answer to be given by this Court to a question of law. That will have to be given independent of such opinion and in the light of the language of the law. The Revenue's inaction does not assist therefore the assessee in any manner. If the Tribunal's view is appearing to be contradictory even that has no relevance in the present case. It is too well settled to require any reiteration that two wrongs do not make one right. There is no equality in illegality. Article 14 of the Constitution of India is, thus, a positive concept. It cannot assist any one in such a negative manner for that would mean that if a wrong has been committed, the Court must perpetuate it or continue it by applying the doctrine of equality. That cannot be done. 17. The Hon'ble Supreme Court in the case of Ekta Shakti Foundation v. Govt. of NCT of Delhi reported in (2006) 10 SCC 337 held as under:- 13. In Coromandel Fertilizers Ltd v. Union of India 1984 Supp SCC 457 it was held in paragraph 13 that wrong d....
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....uality clause this concept nor Article 226 empowers the High Court to enforce such claim of equality before law. If such claims are enforced, it shall amount to directing to continue and perpetuate an illegal procedure or an illegal order for extending similar benefits to others. Before a claim based on equality clause is upheld, it must be established by the petitioner that his claim being just and legal, has been denied to him, while it has been extended to others and in this process there has been a discrimination.' Again In Jaipur Development Authority's case (supra) this Court considered the scope of Article 14 of the Constitution and reiterated its earlier position regarding the concept of equality holding:- "Suffice it to hold that the illegal allotment founded upon ultra vires and illegal policy of allotment made to some other persons wrongly, would not form a legal premise to ensure it to the respondent or to repeat or perpetuate such illegal order, nor could it be legalized. In other words, judicial process cannot be abused to perpetuate the illegalities. Thus considered, we hold that the High Court was clearly in error in directing the appellants to allot the....