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Judgment
J.K. Ranka, J.—Since common question of law is involved in both the sales tax revision petitions, the same are decided by this common order. By the instant sales tax revision petitions, the petitioner-Department has assailed the orders dated February 14, 2002 and September 14, 2005, respectively, passed by the Rajasthan Tax Board (for short, "Tax Board") by which the Tax Board, while rejecting the appeal of the petitioner-Department, has upheld the orders dated November 22, 1999 and March 10, 2004, respectively, passed by the Deputy Commissioner (Appeals) (for short, "DC (A)") by which the DC (A), while quashing and setting aside the orders dated May 27, 1999 and August 1, 2001, respectively, passed by the assessing officer, has deleted the tax and penalty imposed by the assessing officer upon the respondent-assessee.
The counsel for the petitioner-Department submits that the respondent-assessee was granted benefit of tax exemption from October 13, 1993 and May 7, 1990, respectively, under the Sales Tax Incentive Scheme, 1989. While relying upon judgment of the Division Bench of this court in State of Rajasthan and Another Vs. Gopal Oil Mills and Another, State of Rajasthan and Another Vs. M/s Mahaveer Oil Industries and Others, counsel for the petitioner-Department submits that in view of the law laid down by the honourable apex court in the cases, referred to supra, the respondent-assessee was liable to be granted benefit of tax incentive scheme only up to April 4, 1994. It is the submission of counsel for the petitioner-Department that the law is clear and as affirmed by the honourable apex court the benefit under the Sales Tax Incentive Scheme was not allowable at all to the respondent-assessee, however, since many such similarly situated industries had gone ahead and, therefore, keeping the interest of the assessees at large a deadline was fixed by the honourable apex court that the incentive would be available only up to April 4, 1994, i.e., the day when operation of the order of court was stayed by the honourable apex court and not beyond that. He submits that in the light of the aforesaid judgment of the honourable apex court, which is law of the land, the assessing officer issued notice u/s 37 of the Rajasthan Sales Tax Act and submits that the benefit in so far as the period up to April 4, 1994 is concerned, has been allowed by the assessing officer and benefit beyond April 4, 1994 could not have been allowed nor availed of by the respondent-assessee and, therefore, a notice u/s 37, as aforesaid, was issued. He submits that if a judgment has been pronounced by the honourable apex court, then section 37 prescribes that it would be considered as a mistake apparent on the face of record. He drew attention of this court on the plain and simple language of section 37. He further submits that there are various authorities of the honourable apex court that benefit granted on the basis of judgment could not be extended beyond the time allowed by the honourable apex court. In this regard, he referred to the judgment of the honourable apex court in the case of Dwarikesh Sugar Industries Ltd. Vs. Prem Heavy Engineering Works (P) Ltd., and another, He further submits that the assessing officer has not denied the benefit prior to April 4, 1994 and in the light of the aforesaid judgment of the honourable apex and in the case of State of Rajasthan and Another Vs. Gopal Oil Mills and Another, and State of Rajasthan and Another Vs. M/s Mahaveer Oil Industries and Others, the benefit has been withdrawn. He submits that the assessing officer was justified in passing a rectificatory order as inadvertently the benefits were extended for the Assessment year 1994-95, 1995-96 and 1996-97. He further submits that both the Tax Board as well as the DC (A) are unjustified in coming to the conclusion that the assessing officer was not entitled to rectify the mistakes. He further submits that if a mistake has been committed that can always be rectified in the fight of the specific provisions laid down u/s 37 of the Rajasthan Sales Tax Act, 1994. Accordingly, he prayed for reversal of the orders impugned.
Despite notice, no one is appearing on behalf of the respondent-assessees.
The Division Bench of this court in the case of Lokendra Industries v. State reported in [1993] 89 STC 277 (Raj), while considering the Sales Tax Incentive Schemes of 1987 and 1989, has held as under (page 289 in 89 STC):
We, therefore, allow all these seven writ petitions and direct that anything contained in the impugned notification dated May 7, 1990 would not come in the way of the petitioner claiming exemption of the sales tax under the Sales Tax Incentive Schemes of 1987 and 1989 notified, in cases where the industries had been installed and production was started prior to March 31, 1992.
The State of Rajasthan preferred appeals before the honourable apex court in the case of State of Rajasthan and Another Vs. Gopal Oil Mills and Another, and the honourable apex court vide judgment dated February 23, 1995 held as under (page 28 in 115 STC):
We find that even after the impugned judgment of the High Court was rendered on January 12, 1993, eligibility certificates were issued to certain industrial units and a circular dated January 27, 1994 was also issued by the Director of Industries of the State Government on the same lines under which some benefit has been availed of by those industrial units under the State Sales Tax Act. In these circumstances, we consider it appropriate to direct that the unavailed benefit under those eligibility certificates under the State Sales Tax Act would not be available to them but the extent to which the benefit under the State Act has been already availed up to April 4, 1994, the date on which the ex parte order of stay was made by this court, on the basis of the eligibility certificates so issued, the State Government would not disturb that position by seeking to recover any amount under that head.
Thus by the aforesaid judgment, the honourable apex court came to the conclusion that only benefit was allowable up to April 4, 1994 and not later on.
The honourable apex court, again in the case of State of Rajasthan and Another Vs. M/s Mahaveer Oil Industries and Others, after a detailed analysis of various judgments, has held as under (page 39 in 115 STC):
In the premises, the judgment of the High Court, insofar as it sets aside the notification of May 7, 1990 issued under the Rajasthan Sales Tax Act, 1954 is set aside and the notification of May 7, 1990 issued under the Rajasthan Sales Tax Act, 1954 is upheld as valid. The respondents, however, will be entitled to retain the benefits received by them under the Incentive Scheme framed under the Rajasthan Sales Tax Act up to April 4, 1994. The judgment of the High Court insofar as it quashes the notification of May 7, 1990, issued in respect of the incentive scheme under the Central Sales Tax Act is upheld in the light of the decision of this court in the case of State of Rajasthan and Another Vs. Gopal Oil Mills and Another, The appeal is disposed of accordingly. There will, however, be no order as to costs looking to the circumstances of the present case.
I have considered the arguments advanced by counsel for the petitioner and perused the material available on record as well as the order impugned and the judgments relied upon by the counsel for the petitioner and I am of the view that the present sales tax revision petitions deserve to be allowed for the following reasons.
It is true that the Division Bench of this court passed an order on January 12, 1993 in the case of Lokendra Industries [1993] 89 STC 277 (Raj) and the honourable apex court in the case of State of Rajasthan and Another Vs. Gopal Oil Mills and Another, and State of Rajasthan and Another Vs. M/s Mahaveer Oil Industries and Others, reversed the judgment of this court in Lokendra Industries [1993] 89 STC 277 (Raj). Thus on perusal of the judgments it is crystal clear that the honourable apex court approved the notification dated May 7, 1990 issued under the Rajasthan Sales Tax Act, 1954, however, the honourable apex court, considering the hardship having been faced by similarly situated traders, because in the case of State of Rajasthan and Another Vs. Gopal Oil Mills and Another, initially operation of the judgment of the Division Bench was stayed and that stay was granted by the honourable apex court on April 4, 1994, by mentioning this fact, came to the conclusion that the respondents (traders) cannot be discriminated against and, therefore, a cut-off date was fixed as April 4, 1994 and it was directed that the respondents will be allowed to retain the benefit, if any, enjoyed at least up to April 4, 1994, just as the other oil industries have been allowed to retain benefits up to April 4, 1994 and it was clarified that the benefit cannot be extended beyond April 4, 1994 or up to the date of judgment rendered by the honourable apex court, i.e., April 20, 1999. Therefore, by the aforesaid two judgments of the honourable apex court, it was directed that the benefits flowing from issuance of certificate or/and incentive scheme was not correct and ultimately the notification of May 7, 1990 was upheld as valid.
It is also appropriate to quote section 37 of the Rajasthan Sales Tax Act, 1994 which reads as under:
Rectification of a mistake.--(1) With a view to rectifying any mistake apparent from the record, any officer appointed or any authority constituted under the Act may rectify suo motu or otherwise any order passed by him.
Explanation: A mistake apparent from the record shall include an order which was valid when it was made and it subsequently rendered invalid by an amendment of the law having retrospective operation or by a judgment of the Supreme Court, the Rajasthan High Court or the Rajasthan Tax Board.
(2) No application for rectification shall be filed under sub-section (1) after the expiry of a period of three years from the date of the order sought to be rectified.
(3) Where an application under sub-section (1) is presented to the assessing authority, appellate authority or Tax Board and a receipt thereof is obtained, it shall be disposed of within a period of one year from date of presentation and where such application is not disposed of within the said period, the same shall be deemed to have been accepted.
(4) No rectification under this section be made after the expiry of four years from the date of the order sought to be rectified.
(5) An order of rectification which has the effect of increasing the liability of a dealer in any way, shall not be made without affording him an opportunity of being heard.
On perusal of the above, it is apparent that the explanation answers the present controversy which makes it very clear that any mistake apparent from the record by a judgment of the Supreme Court, Rajasthan High Court or the Rajasthan Tax Board, therefore, in my view, in the light of the judgment of the honourable apex court, the rectification, insofar as the present facts and circumstances, are concerned, have been correctly made by the assessing officer. It is a matter of fact that when benefit has been extended by the honourable apex court, considering the hardship faced by the similarly situated traders, up to the period when the operation of the judgment of this court was stayed, i.e., April 4, 1994 and when benefit has been denied to all such assessees, who were before the honourable apex court, then by no stretch of imagination, such a benefit beyond April 4, 1994 can be extended to the present respondents. The benefit for all assessees or for all similarly situated assessees would be extended only up to April 4, 1994 as upheld by honourable the apex court and, therefore, in my view, both, i.e., the Tax Board as well as the DC (A) have erred in holding it otherwise.
The honourable apex court in the case of Dwarikesh Sugar Industries Ltd. Vs. Prem Heavy Engineering Works (P) Ltd., and another, has reiterated the fact in the words that "when law is well settled by judicial pronouncements of Supreme Court, then ignoring the same by subordinate courts amounts to judicial impropriety and judicial adventurism" and held as under (page 634 in Comp Cas):
When a position, in law, is well-settled as a result of judicial pronouncement of this court, it would amount to judicial impropriety to say the least, for the subordinate courts including the High Courts to ignore the settled decisions and then to pass a judicial order which is clearly contrary to the settled legal position. Such judicial adventurism cannot be permitted and we strongly deprecate the tendency of the subordinate courts in not applying the settled principles and in passing whimsical orders which necessarily has the effect of granting wrongful and unwarranted relief to one of the parties. It is time that this tendency stops.
Thus, in the light of the above and judgments of the honourable apex court, in my view, both the instant sales tax revision petitions stand allowed. The orders impugned passed by the Tax Board and DC (A) in both the present matters, are hereby quashed and set aside and the order passed by the assessing officer is sustained. No order as to cost.