Decided on November 01,2012

Chandra Kathha Industries Private Limited Appellant
State of Uttarakhand and others Respondents


Sudhanshu Dhaulia, J. - (1.) Heard Mr. S.K. Posti, Advocate for the petitioner, Mr. N.P. Sah, Standing Counsel for the State of Uttarakhand and Mr. Virendra Kaparwan, Advocate for respondent no. 3.
(2.) The petitioner is a private limited company having its registered office at Kotwali Road, Najibabad, District Bijnor in Uttar Pradesh. The petitioner is in the business of manufacturing and sell of "kathha" and catechu for which a basic raw material is "khair wood". The petitioner had to procure its major portion of "khair wood" which is the basic raw material for production of "kathha" through auction purchase and other means of purchase from the State of Uttarakhand. Prior to 9.11.2000 Uttarakhand was the part of the erstwhile State of Uttar Pradesh and the petitioner was enjoying the benefit of Section 4B of the U.P. Trade Tax Act whereby certain concessions were given to the petitioner for purchase of this raw material. After 9.11.2000 the territory from which the "kathha" was being procured by the petitioner became the part of Uttarakhand and consequently a notification was issued by the State of Uttarakhand on 26.12.2000, in order to continue these benefits, which reads as under : "51/Vitta Vyapar Kar/2000 Dated : Dehradun : December 26, 2000 (Gazette dt. 26.12.2000) Whereas, the State Government is satisfied that it is necessary so to do in public interest; Now, Therefore, in exercise of the powers conferred by sub-section (5) of section 8 of the Central Sales Tax Act, 1956 (Act no. 74 of 1956), the Governor is pleased to direct that with effect from the date of publication of this notification in the official Gazette, the tax payable under sub-section (1) of the said section by any dealer having his place of business in the State of Uttaranchal of business, of any raw material, processing material, consumable stores, spare-parts, accessories, components, fuel or lubricants and packing material to the dealer having his place of business in the State of Uttar Pradesh and possessing recognition certificate issued under section 4-B of Uttar Pradesh Trade Tax Act, 1948 (Act no. XV of 1948), whose validity commences prior to November 9, 2000, for the use in the manufacture of goods or in the packing of goods manufactured by him, shall be calculated at such rate as would have been leviable on such sales against Form 3-B prescribed under the said U.P. Act No. XV of 1948, subject to the condition that the dealer selling the goods furnishes the declaration in Form C', or, as the case may be, the certificate in Form D' in accordance with the provisions of sub-section (4) of section 8 of the said Act no. 74 of 1956."
(3.) In short, what the said notification states is that such dealers who were getting the benefit under Section 4-B, now under U.P. Reorganisation Act, they would continue to get the concession against Form-C of Central Sales Tax Act, 1956, as the said sale will now be an inter-state sale. After the said notification, the petitioner after the purchase of "khair" wood by way of an auction faced difficulty inasmuch inspite of the said notification the benefit under Section 4-B was not given to the petitioner and instead of concessional rates being charged by the Government he was charged the full rate of tax. Aggrieved the petitioner has filed the present writ petition before this Court.;

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