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P. Venkatarama Reddi, J.—The petitioner is a registered dealer under the Andhra Pradesh General Sales Tax Act doing business in iron and steel products. The petitioner states that it has a re-rolling mill in Karnataka State, that it purchases tax-suffered steel scrap and ingots within the Stale of Andhra Pradesh, takes the said scrap and ingots to Karnataka and after manufacturing finished products like rounds and flats at its re-rolling mill, brings the said finished products to Andhra Pradesh and sells them within the State of A.P. On the basis of representations from re-rollers and traders, the State Government of Andhra Pradesh issued certain notifications u/s 9 of the APGST Act meant to minimise the burden of taxation on the finished products of iron and steel derived out of the tax-suffered raw-material such as scrap and ingots. The petitioner stands excluded from the application of those notifications by reason of the fact that it has no re-rolling mill in the State of Andhra Pradesh. The petitioner pleads that notwithstanding the fact that its manufacturing unit is situate outside the State of Andhra Pradesh, the benefits conferred by the said notifications shall be made applicable to the sales of finished products effected by the petitioner within the State of A.P, on par with the finished products manufactured in the State of Andhra Pradesh. The petitioner further contends that if the goods manufactured outside the State of A.P. are treated differently from the locally manufactured goods for the purpose of taxation under the APGST Act, the impost will be contrary to the provisions of Articles 301 and 304 of the Constitution of India or, in the alternative, it will be violative of Article 14 of the Constitution. To substantiate its contention based upon Articles 301 and 304 (raised in the additional affidavit), the learned Counsel for the petitioner referred to series of decisions of the Supreme Court decided during the years 1988 and 1989. They are- Indian Cement and Others Vs. State of Andhra Pradesh and Others, ; West Bengal Hosiery Association and Others Vs. State of Bihar and Another, . Weston Electronics v. State of Gujarat, AIR 1988 SC 2038, 70 STC 52; Video Electronics Pvt. Ltd. v. State of Rajasthan, (1988) 71 STC 304 (RAJ). The learned Counsel has also referred to a recent decision of this Court in Blue Star Ltd. Vs. State of Andhra Pradesh and Another, to which one of us (Lakshmana Rao, J.) was a party.
Though several notifications have been referred to in the writ petition, the learned Counsel for the petitioner has, in the course of arguments, confined his attack on two G.Os., viz., G.O. Ms. No. 1373, Revenue, dated 28-8-1981 amending G.O. Ms. No. 88 Revenue, dated 28-1-1977 and G.O. Ms. No. 498 Revenue, dated 20-3-1984. It is useful to extract these G.Os. G.O. Ms. No. 88 Revenue, dated 28-1-1977 as it stood on the date of promulgation of G.O. Ms. No. 1373 Revenue, dated 28-8-1981 reads :
"In exercise of the powers conferred by Sub-section (1) of Section 9 of A.P.G.S.T. Act, 1957 (Act VI of 1957) the Governor of Andhra Pradesh hereby makes an exemption with effect from 1st April, 1976, the re-rolled finished products of Steel Re-Rollers from the tax payable under the said Act, subject to the condition that the tax has been levied under the said Act on the sale or purchase of any of the material specified in Item 2 of Schedule III to the said Act."
By G.O. Ms. No. 1373, Revenue dated 28-8-1981, for the words "the re-rolled finished products of the Steel Rollers" the words "the re-rolled finished products of the Steel Re-Rollers situated within the Andhra Pradesh State" have been substituted. G.O. Ms. No. 88 was cancelled by G.O. Ms. No. 1616 Revenue, dated 29-10-1981 and the cancellation became effective from 4-2-1982 i.e., the date on which the said G.O. was published in the Andhra Pradesh Gazette. Thus, the notification was a short-lived one. The next relevant notification is Nofitication II issued in G.O. Ms. No. 498, Revenue, dated 20-3-1984. The said notification reads thus :
"In exercise of the powers conferred by Sub-section (1) of Section 9 of the Andhra Pradesh General Sales Tax Act, 1957 (Act VI of 1957), the Governor of Andhra Pradesh hereby directs that where a tax has been levied and collected under the said Act in respect of the sale or purchase inside the Slate, of steel ingots or billets referred to in item 2 of Third Schedule to the said Act, the tax leviable u/s 6 of the said Act on the re-rolled finished products manufactured within the State from out of such ingots or billets by the steel re-rollers and Mini-Steel Plants-cum-Re-Rollers (in case of Purchase of ingots and billets by them in the State) situated within the State of Andhra Pradesh and sold inside the State shall be reduced by the amount of tax levied and collected on such ingots and billets during the period from the 4th of February, 1982 to the 31st of March, 1985."
Reference was also made by the learned Counsel to G.O. Ms. No. 1194 dated 17-7-1984. However, the notification issued in the said G.O. obviously has no application to the petitioner as indisputably, the petitioner did not ''sell'' any iron and steel scrap within the State of Andhra Pradesh.
It is true that as contended by the learned Counsel for the petitioner that the benefits conferred by the aforementioned two G.Os are applicable only to the sales of finished products manufactured within the State by the steel re-rollers situated within the State of Andhra Pradesh. The finished products got manufactured by the petitioner at its re-rolling mill located in Karnataka State and sold in Andhra Pradesh State will not qualify for any exemption or set off as provided for by the said G.Os even though the other conditions of the G.O. such as the payment of tax on the steel scrap/ingots within the State are satisfied. Prima facie, the ratio of the judgments of Supreme Court and of this Court adverted to supra will apply to the facts of this case. When we pointed out to the learned Counsel that if the impugned notification offends the constitutional provisions in Part XIII relating to freedom of inter-state trade and commerce, the entire notification is liable to be struck down just as the Supreme Court had done and a uniform rate of tax will have to be applied to all the sales, the learned Counsel clarified that his client is not interested in seeking for a declaration that the impugned notifications shall be struck down in toto. The question then is whether it is possible to sever the so-called offending words of the notification and to direct the extension-of benefit to sales of all finished products irrespective of their place of manufacture. Assuming that such a declaration or direction could be given by this Court on the analogy of the principle of interpretation applicable to a legislation or notification offending Article 14 of the Constitution, having regard to the intent and purpose of the notification, we are unable to say that such a judicial exercise is possible. We are not sure whether the Government could have issued the aforementioned notifications if they had been aware of the fact that the exemption/set off should be extended either to all finished products or to none at all. Presumably that is the reason why the Supreme Court as well as this Court struck down the notification in toto and directed the levy of a uniform higher rate in relation to the goods manufactured locally as well as the goods brought from outside the State. It was further directed in Video Electronics Pvt. Ltd. case (4 supra) that the past transactions shall not be affected, keeping these factors in view, the petitioner will gain practically nothing by declaring the impugned notifications as ultra vires of Articles 301 and 304 of the Constitution and in fact we are not called upon to do so. Hence we are not prepared to strike down the notifications and give any relief to the petitioner though prima facie we are satisfied that the constitutional mandates enshrined in Part XIII have been violated.
This takes us to the next question whether the impugned notifications are violative of Article 14 of the Constitution. If the notifications are held to be violative of Article 14, Mr. Ananta Babu, the learned Counsel contends that the offending words in the notifications can be removed or in the alternative a direction can be given to accord the same treatment to the petitioner in respect of its sale of finished products as the local manufacturers. For this purpose, he relies upon the decision reported in Purshottam Lal and Others Vs. Union of India (UOI) and Another, , and an unreported decision of a Division Bench of this Court in W.P. No. 7675/83 dt. 10-11-1987 arising under Central Exercise Act. First we will consider the question whether the impugned notifications in so far as they restrict the benefit of exemption/concession to the sales of finished products manufactured by the steel re-rollers within the State of Andhra Pradesh only is violative of Article 14.
It is well settled that a taxation law though not immune from challenge from the stand point of Article 14 of the Constitution, a greater degree of judicial indulgence is called for and the State is to be allowed a wider latitude in the matter of classification. It is not a condition of the guarantee of equal protection that all transactions, properties, objects or persons of the same genus must be affected by it or none at all. (Vide V. Venugopala Ravi Varma Rajah Vs. Union of India and Another, . The following observations of the Supreme Court in Orient Weaving Mills (P) Ltd. Vs. The Union of India (UOI), are quite apposite :
"The Act recognises and only gives effect to the well-established principle that there must be a great deal of flexibility in the incidence of taxation of a particular kind. It must vary from time to time, as also in respect of goods pro ducted by different processes and different agencies... .The State naturally is interested in raising all the revenue necessary for public purposes, without sacrificing the legitimate interests of persons and groups, who deserve special treatment at the hands of the State for reasons, which the State may determine, entitling them to be placed in a special class."
In the matter of granting exemptions and concessions, the Government has naturally to take into account and balance diverse factors, having due regard to the paramount interests of revenue. Bearing these principles in view, it cannot be said that the impugned notifications are in any way obnoxious to Article 14 of the Constitution. By virtue of the exemption/concession declared by the impugned notifications, the State has to forego the revenue which is otherwise derivable from the charging provisions of the A.P.G.S.T. Act. Keeping in view the industrial development of the State and the consequential monetary "and other advantages accruing to the State, there is nothing objectionable in the Government restricting the exemption only to the goods manufactured within the State in the industrial units located in the State. They need not go further and say that the goods manufactured outside the State should also be eligible for this exemption. The classification of goods on the basis of situs of manufacture cannot be said to be an irrational or impermissible classification. One more vaild basis for classification is furnished by the reason given in the counter-affidavit. It is stated that in the case of finished products manufactured outside the State, it is difficult to ascertain the identity of the goods. The exemption is available only if out of the raw material that suffered tax within the State the finished products are manufactured and sold within the State. But, as pointed out in the counter, there is no guarantee that the finished products that are brought from the other State would be manufactured out of the scrap/ingots that were purchased within the State of A.P. because there is a possibility of the said finished products being manufactured out of the raw-material purchased in the State of Karnataka. It is difficult for the Andhra Pradesh Sales Tax authorities to keep track on the manufacturing activity in the other State and to test the correctness of theclaim put forward by the assessee in this regard. Viewed from this angle, also, the denial of exemption/concession to the goods manufactured outside the State rests upon an intelligible basis having reasonable nexus with the object sought to be achieved. We therefore repel the argument that the -impugned notifications violate Article 14 of the Constitution. It is relevant in this context to refer to the decision of this Court in Mahindra and Mahindra Limited and Another Vs. State of Andhra Pradesh and Another, wherein the concession extended only to the products of a local industry was upheld.
There is also one more aspect which we would like to advert before we conclude. By declaring the notifications issued in the years 1981 and 1984 at this distance of time, we will perhaps be facilitating unjust enrichment by the assessee. There is no knowing ''whether during this interregnum the petitioner had passed on and collected the tax from the customers. The reasonable presumption is that it would have so collected. If so, the discretionary relief under Article 226 need not be granted to the petitioner, even assuming that the notifications are bad in law.
We therefore dismiss the writ petition, but without costs. Advocate''s fee Rs. 250/-.