- (1.) By means of the present writ petition, the petitioner is challenging the order dated March 6, 2007 passed by the Additional Commissioner, Grade I, Trade Tax, Moradabad Zone, Moradabad, for the assessment years 2000-01 2001-02 and 2002-03, all under the Central Sales Tax Act, by which he has granted the approval to initiate the proceedings under section 21 of the U. P. Trade Tax Act (hereinafter referred to as, "the Act") beyond the normal period of limitation and the initiation of reassessment proceedings by the Deputy Commissioner (Assessment), Grade II, Trade Tax, Moradabad for the aforesaid assessment years vide notice dated March 8, 2007.
(2.) The petitioner is a partnership firm, carrying on the business of manufacture and sale of wooden pallets and plywood and fitments. The Uttarakhand had been formed on November 9, 2000 after carving out some of the area of State of Uttar Pradesh. Prior to the formation of Uttarakhand, the provisions of the U. P. Trade Tax Act were applicable to the area of Uttarakhand. The sales to the manufacturers holding recognized certificate under section 4B of the Act were, either partially exempted or fully exempted under the notification issued in this regard. However, this benefit was not available on the sale to the manufacturers of Uttarakhand after its formation. It appears that to provide same benefits on the sales made by the dealer of the State of U. P. to the manufacturer of Uttarakhand, a Notification No. KA.NI-2-3915/XI-9(129)/2000-Act-74-56-Order(49)-2000, dated November 23, 2000 had been issued in exercise of powers under section 8(5) of Central Sales Tax Act, 1956. The aforesaid notification provides that the sales in the course of inter-State, trade or commerce to the dealer holding recognition certificate issued under section 4B of the Act 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 IIIB prescribed under the said U. P. Act No. 15 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 Central Sales Tax Act. For the calculation of rate, which would be leviable under the aforesaid notification, the notifications issued under section 4B of the Act were relevant. Under the Notification No. K.A.NI.-2-530/XI-9(231)/94-U. P. Act-15-48-Order-2000, dated February 17, 2000 sales of all the goods other than the goods mentioned at serial Nos. 1 and 2 were liable to tax at 2.5 per cent other than the declared goods. Notification No. TIF-2-289/XI-9(820)/92-U. P. Act-15-48-Order-99, dated February 12, 1999 issued in exercise of powers under section 4B of the Act provides that no tax shall be payable on the sales to or as the case may be purchase by a dealer holding a valid recognition certificate under sub-section (2) of the said section of any raw materials, processing material, consumable stores, spare parts, accessories, components, fuel or lubricants and packing materials required by him for the use in the manufactures of goods or in the packing of goods manufactured by him and such manufactured goods shall be notified goods for the purpose of said section subject to certain conditions. One of the conditions was that the above facility will be available only when, the manufactured goods is exported outside the country.
(3.) During the years under consideration, the petitioner had sold the goods to the manufacturer/dealer of Uttarakhand. During the course of assessment proceedings for the assessment year 2000-01, in respect of some of the turnover the dealer admitted the liability of tax at 2.5 per cent but claimed full exemption on the turnover of Rs. 32,18,445. For the assessment year 2001-02, the petitioner admitted the liability of tax at 2.5 percent on the turnover of Rs. 21,62,162.50 and claimed full exemption on the sales of Rs. 32,18,445.48. Since form C in respect of the aforesaid turnover could not be filed, the assessing authority levied the tax at 10 per cent and allowed time to the petitioner to furnish form C. The petitioner furnished the form C subsequently. Therefore, Misc. Order has been passed by the assessing authority on December 26, 2002. The assessing authority levied the tax at 2.5 per cent on the turnover of Rs. 24,91,330 and had exempted the turnover of Rs. 34,39,927. Likewise, for the assessment year 2001-02 in the absence of form C the tax has been levied at 10 per cent and the time for filing the form C was allowed. The petitioner filed form C within the time allowed. The assessing authority passed the Misc order on April 7, 2003 and levied the tax at 2.5 per cent on the turnover of Rs. 49,13,786 and granted exemption on the turnover of Rs. 1,09,25,489. For the assessment year 2002-03 in the original assessment proceeding, in the absence of form C the tax was levied at 10 per cent. Out of the aforesaid turnover, form C in respect of Rs. 99,55,684 was furnished. The assessing authority has granted the exemption on the aforesaid turnover.;