TaxTMI 
TaxTMI 
2025 (9) TMI 1218
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....ed 23.03.2001 (Annexure P-1); resolution dated 31.12.2010 (Annexure P-2); demand notices dated 19.04.2011, 30.05.2011, 30.06.2011, 05.08.11, 17.07.2012, 27.07.2013, 06.11.2013 and 22.04.2014 (Annexure P-3). (ii) For a direction to respondent No.2 to refund the amount of Rs. 32,00,602 paid by the petitioner to respondent No.2 vide letters dated 10.10.2011, 28.3.2012, 02.08.2012 and 11.03.2013, for the period 01.04.2011 to 31.03.2013. (iii) Other appropriate reliefs have also been prayed for as the facts and circumstances of the case do necessitate. WP (T) No. 49/2014 (i) For quashment of resolution dated 15.04.2013 (Annexure P-1); letter dated 29.11.2013 (Annexure P-2), letter dated 03.12.2013 (Annexure P-3), letter and demand notices dated 13.12.2013 (Annexure P-4) and 01.02.2014 (Annexure P-5). (ii) Other appropriate reliefs have also been prayed for as the facts and circumstances of the case do necessitate. 3. The factual background: The petitioner No.1 is Company incorporated under the Indian Companies Act, 1956 (hereinafter referred to as the "Companies Act") which established its steel plant in District Raigarh, Chhattisgarh, and has b....
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....l & Power Limited, which inter alia is engaged in business of manufacture of steel, with significant presence in mining, power generation and infrastructure. 6. On 24.03.2001 respondent No.1 in WP (T) No. 118/2014 wrote a letter to respondent No.2 intimating it for imposition of Terminal Tax in terms of Rules, 1996. The letter dated 24.03.2001 further asked respondent No.2 that if the Terminal Tax had not been levied by the said date, it (respondent No.2) shall levy the same on goods exported from Nagar Panchayat. On 10.04.2001 respondent No.1 wrote another letter to respondent No.2 reminding of the letter dated 24.03.2001, and asking to implement the Terminal Tax at the earliest and report back to it (respondent No.1) on the levy status. On 31.12.2010, the Council purportedly passed a resolution seeking to levy Terminal Tax for the year 2011-2012 on 'Iron and all sorts of machinery', and accordingly proceeded on a wrongful assumption that the petitioner No.1 - Company is engaged in the export of 'Iron goods and concrete' from an area falling within the limits of respondent No.2. 7. On 28.02.2011 a notice was issued to the petitioner No.1 - Company by respondent No.2 to the e....
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....s. 08,87592/- through cheque dated 26.03.2012 for the period 01.10.2011 - 31.03.2012. Again on 17.07.2012 the respondent No.2 wrote a letter to petitioner No.1 - Company and demanded terminal tax for the period April 2012 - June 2012, in response to which on 02.08.2012 the petitioner No.1 - Company deposited a sum of Rs. 04,48,033/- towards Terminal Tax for the said period. Again on 11.03.2013, petitioner No.1 - Company deposited a sum of Rs. 10,54,490/- for the period 01.04.2012 - 31.03.2013. Again on 27.07.2013 respondent No.2 issued a letter to petitioner No.1 - Company regarding deposit of Terminal Tax for the period April 2013 - July 2013. Respondent No.2 again issued a letter on 06.11.2013 to the petitioner No.1 - Company for depositing the Terminal Tax for the goods exported for the period April 2013 - October 2013, and on 22.04.2014 respondent No.2 issued another notice to petitioner No.1 - Company to deposit Terminal Tax for the period 01.04.2013 - 31.03.2014. On 08.05.2014 petitioner No.1 - Company made a representation to the concerned Chief Municipal Officer regarding illegal demand of Terminal Tax. 10. Learned Sr. Counsel appearing for the petitioners submits that d....
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....holly discriminatory and contrary to the Articles 14, 19 and 21 of the Constitution of India as the impugned Demand Notices are based on an assumption that the petitioner-company is engaged in the export or sale of iron-ore and other machinery from the limits of the respondent No.2. It is submitted that Entry 12 to the Schedule to Terminal Tax Rules, 1996 framed by the State of Madhya Pradesh in exercise of its powers under Section 433 read with Section 132 (2)(o) and Section 133 of the Madhya Pradesh Municipal Corporation Act, 1956 and under Section 355 read with Section 127 (1)(XVI) and Section 129 of the Madhya Pradesh Municipalities Act, 1961, provides for levy of Terminal Tax on "iron and all sorts of machinery", which admittedly are neither manufactured or produced in the subject area of the plant purportedly lying within the limits of the respondent No.2 nor exported by the Petitioner Company. It is submitted that respondent No.2 has erred in not considering the fact that Terminal Tax under the Municipalities Act can be imposed on the goods that are exported from the limits of the Municipal Area only, but in the case in hand the petitioner-Company does not export goods from ....
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.... the petitioners, respondent No. 2 erred in not considering that the power to levy terminal tax originates at the point from where the goods are exported and not at the point where goods are merely halted to be taken to the final destination. Referring to a decision of High Court of Madhya Pradesh in the matter of Northern Coal Fields Limited v State of Madhya Pradesh 2010 (2) MPLJ 202 learned Sr. counsel submits that the word "export" will not include the goods in "transit" when they pass through the Municipal Limits. 13. It is submitted by the learned counsel for the petitioners that the petitioner-company imports iron ore and manufactures steel. To substantiate that, he has filed a copy of the product broucher. Therefore, it is submitted that product of the petitioner-company does not fall under schedule 12. Thus according to the counsel for the petitioners, the impugned Demand Notices are contrary to the Rules and liable to be quashed. In support of his submissions, reliance is placed on the decisions of the Supreme Court in the matter of Central India Spinning and Weaving and Manufacturing Company, Limited, the Empress Mills, Nagpur v. Municipal Committee, Wardha reported i....
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....hin the municipal limits, therefore, levy of terminal tax is in accordance with law. Availability of alternative remedy against issuance of demand notices and also the delay and laches in challenging the same in pursuance of the order passed by respondent No.1 on 24.03.2011 has also been cited as one of the grounds for dismissal of the petition. In support of the submissions, reliance is placed on the decision of the Supreme Court in the matter of Man Mohan Tuli and another v. Union of India and others and Municipal Corporation of Delhi v. Man Mohan Tuli and another reported in (1981) 2 SCC 467. 16. Patient hearing to the arguments advanced at length and close scrutiny of the documents annexed to the petitions in depth has been resorted to. 17. Before marching towards the factual analysis, this Court deems it necessary to take a look of the relevant provision dealing with the imposition of terminal tax. 18. Section 2(c) of the Terminal Tax (Assessment and Collection) on the Goods Exported from Madhya Pradesh Municipal Limits, Rule, 1996, defines "terminal tax" as under:- "Terminal tax" means the terminal tax on goods exported from the Municipal limit in accordance....
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....e contention of the respondent No.2 that since the plant lies within the limits of respondent No.2 and the manufacture of goods takes place within its municipal limits Terminal Tax is liable to be paid, does not appear to have any force and is liable to be discarded. In other words, merely because the plant lies within its limits and some activities relating to processing of goods take place, does not empower that Municipal Corporation to levy terminal tax unless goods have actually been exported from the area of respondent No.2. 22. Similarly, respondent No.2 cannot levy terminal tax if goods are stored in a Stockyard lying within its premises as only after goods leave the factory gate does their export journey commence. Terminal tax can be imposed by the municipality from where goods are exported only after commencement of their journey. Since, in the facts of the present case, the export journey of goods commences from Chiraipani Gram Panchayat once saleable goods are dispatched from the factory premises through MLSM gate, the respondents have no jurisdiction to demand terminal tax. 23. This proposition is fortified by the decision of the Madhya Pradesh Court in the matter....
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....der: "6. The short question for consideration is whether glass sheets all within the ambit of the expression "goods made of glass and glassware". "9. Therefore, a glass sheet, as found by the Board, is "glass simpliciter". While considering the question as to whether a glass mirror can be classified as "glassware", the Supreme Court observed in Atul Glass Industries (P.) Ltd. v. Collector of Central Excise [1986] 63 STC 322, that a glass sheet undergoes a complete transformation when it emerges as a glass mirror. What was a piece of glass simpliciter, becomes another commercial product. Glass sheet is, therefore, a primary product "glass simpliciter" which can be used for producing "goods or articles made of glass". It is significant to note that whenever the legislature intended to include sheets of a primary product along with goods made of that product, in any entry, the legislature expressly made reference to sheets of that product as is evident from perusal of certain entries in Part III of the Schedule II of the Act. Entry No. 4 is "sheets, fabrics and goods made of plastic". Entry No, 12 is "asbestos sheets and goods made thereof". In entry No. 26 of Part I....
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....he High Court of its powers under Article 226 of the Constitution in an appropriate case though ordinarily, a writ petition should not be entertained when an efficacious alternate remedy is provided by law; 27.5 When a right is created by a statute, which itself prescribes the remedy or procedure for enforcing the right or liability, resort must be had to that particular statutory remedy before invoking the discretionary remedy under Article 226 of the Constitution. This rule of exhaustion of statutory remedies is a rule of policy, convenience and discretion; and 27.6 In cases where there are disputed questions of fact, the High Court may decide to decline jurisdiction in a writ petition. However, if the High Court is objectively of the view that the nature of the controversy requires the exercise of its writ jurisdiction, such a view would not readily be interfered with." 26. Further, in the matter of Central India Spinning and Weaving and Manufacturing Company (supra) it has been held by the Supreme Court as under:- 25. Even assuming that the words "imported into or "exported from " could be restricted only to their derivative meaning and thus constr....
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....nicipal area even then the construction to be placed on the term should be the one that favours the tax- payer, in accordance with the principle of construction of taxing statutes, which must be strictly construed and in case of doubt must be construed against the taxing authorities and doubt resolved in favour of the taxpayer. In Crawford on Statutory Constructions in para. 257 at p. 504 the following passage pertaining to construction of taxing statutes taken from Bedford v. Johnson (1) is quoted: "Statutes levying taxes or duties upon citizens will not be extended by implication beyond the clear import of the language used, nor will their operation be enlarged so as to embrace matters not specifically pointed out, although standing upon a close analogy, and all questions of doubt will be resolved against the government and in favour of the citizen, and because burdens are not to be, imposed beyond what the statute expressly imparts". "In that case the court refused to regard automobile parking lots as falling within the scope of a statute which imposed a tax on general warehouse storage establishments. On this principle the word " terminal " must in the context....