- (1.) BY this petition under article 226 of the Constitution petitioner, Alpha Chem, has challenged vires of the provisions of section 4-A (3) of the U. P. Sales Tax Act, 1948 (for short, "the Act" ).
(2.) BEFORE dealing with the actual point in issue, it is necessary to state as to how this case came to be listed before this Bench after innings up to the apex Court. Petitioner No. 1, Alpha Chem, is a registered partnership finn of which petitioner No. 2 is a partner. The firm is registered under the provisions of the U. P. as well as Central Sales Tax Acts and has a factory at C-17/18, Industrial Area, Bulandshahar Road, Ghaziabad, where it is engaged in the business of manufacture and sale of blowing agent and processing of aluminium silicate. On an application made by the petitioner No. 1, it was granted an eligibility certificate on December 5, 1984 by the Joint Director of Industries, Western Region, Meerut, for grant of exemption from payment of sales tax under section 4-A of the Act. The said eligibility certificate (annexure 1 to the writ petition) was valid for a period of 5 years with effect from April 1, 1983 to March 31, 1988. However, a notice dated August 18, 1987 (annexure 2 to the writ petition) under section 4-A (3) of the Act was issued to the petitioner by the Assistant Commissioner (A. N. R.), Sales Tax, U. P. to show cause as to why the eligibility certificate dated December 5, 1984 issued to the petitioner be not cancelled. The aforesaid notice was replied to by the petitioner vide letter dated September 3, 1987 (annexure 3 to the writ petition) contesting all the points raised in the notice. Thereafter, vide another letter dated February 17, 1988 (annexure 4 to the writ petition) petitioner raised an objection that Commissioner of Sales Tax has no authority and jurisdiction to initiate proceedings under section 4-A (3) of the Act. The Commissioner of Sales Tax vide order dated February 27, 1988 (annexure 5 to the writ petition) cancelled the eligibility certificate dated December 5, 1984. Hence this petition.
(3.) THIS petition was listed before a division Bench of this Court which dismissed the petition with the observation that it will be open to the petitioner to raise contention with regard to the validity of section 4-A (3) of the Act in the revision filed by him, against which petitioner preferred Special Leave Petition (Civil) No. 14336 of 1990 and their Lordships of apex Court (See Alpha Chem v. (See Alpha Chem v. State of U. P. [1993] 89 STC 304 (SC)) relying upon K. S. Venkataraman and Co. (P) Ltd. v. State of Madras [1966] 17 STC 418 (SC) at pages 436 and 437; [1966] 2 SCR 229 at pages 247 and 248 and holding that the authorities under the Act cannot go into the vires of the very statute under which they are constituted and draw their power and jurisdiction from, so is the High Court in matters arising before it from proceedings under the Act to examine the constitutionality of the statute and its provisions, set aside the order of this Court and remitted the writ petition to the High Court for disposal in accordance with law. However, the apex Court made it clear that the High Court can, of course, deal with the question of constitutionality in judicial review of legislation under article 226. THIS is how this petition came to be listed now before this Court. Sri Bharat Ji Agarwal, learned counsel for the petitioner, submitted that the Commissioner of Sales Tax, U. P. , has no jurisdiction whatsoever to cancel or modify the eligibility certificate once granted to a new unit as the certificate is granted by the committee consisting of Divisional Commissioner, Deputy Commissioner, Sales Tax and the Regional Director of Industries and in case of any difference of opinion between the Director of Industries and the Commissioner of Sales Tax, U. P. , the matter was to be referred to the State Government to be considered by a Committee of the Principal Secretary (Industries), Finance Secretary and the Secretary, Institutional Finance for taking final decision. This provision is notified by the State Government of U. P. vide Notification No. ST-II-7558/x-9 (208)-1981-U. P. Act XV-48-Order-85, dated December 26, 1985 in exercise of the powers under section 4-A of the Act.;