Tarun Chatterjee, J. - (1.) The writ petitioners started a small manufacturing fruit processing unit at 37, Imjad Ali Lane, Calcutta under the name and style "Tulip Products Co." In the said fruit processing unit, the writ petitioners were manufacturing fruit juice, jelly, jam etc. The writ petitioner was a registered dealer under the Bengal Finance Sales Tax Act, 1941. West Bengal Sales Act, 1954 and is now registered under the West Bengal Sales Tax Act, 1994. In the audited balance sheet for the year 1979-80 the value of the plant and machinery was Rs. 2,29,121.03/-. In 1994, the rate of sales tax on fruit juice was 20% and the rate of sales tax of jelly and jam was 12%. Until May 1994, there was no incentive scheme with regard to such fruit processing unit and as such, the State Government came out with an incentive scheme for exemption of sales tax with regard to fruit processing unit by a Notification being Notification No. 1428-FT dated 26th May, 1994. In this Notification, it was stated that no sales tax would be payable on fruit juice, fruit syrup etc. when the notified commodities are manufactured in the small scale industrial unit in West Bengal registered with the Directorate of Cottage and Small Scale Industries by the Government of West Bengal and the investment by the dealer in plant and machinery of such unit is less than Rs. 5 lacs. This Notification has been annexed at page 36 of the writ petition. According to the writ petitioner, the value of the plant and machinery which could be used in the process of manufacture of either fruit juice or jam and jelly on the date of issue of Notification was less than Rs. 5 lacs. As such, for the assessment year ended four quarters of 31st March, 1995, the Assistant Commissioner of Commercial Taxes on the basis of such scheme had accepted the dealer's claim for exemption under the aforesaid Notification and by his order dated 27th June, 1997, the exemption was allowed. However, for the assessment under the 1941 Act which was made later i.e. on 23rd June, 1998, the Assistant Commissioner, however, valued the plant & machinery above Rs. 5 lacs and, accordingly, held that the petitioner was not entitled to exemption of sales tax on the aforesaid products on the basis of the Notification as noted herein-above. The Assessing Officer took the book value assessment as on 31st March, 1980 at Rs. 2,27,148.78/- and the addition made from 1981 to 1986-87 took the value of investment of plant and machinery for the assessment year 1.5.1995 to 31st March, 1996 as Rs. 6,58,587/- for assessment under West Bengal Sales Taxes Act, 1994 along with an assessment for the broken period between 1.4.1995 to 30.4.1995 including the turn-over tax. The aforesaid order of the Assistant Commissioner was thereafter confirmed by the Deputy Commissioner in appeal. The matter thereafter was taken to the West Bengal Taxation Tribunal (In short "Tribunal"). By its order dated 19th January, 2000, the impugned assessment order and the appellate order were set aside on a limited ground. The matter was remanded back to the Assessment Officer for re-assessment in the light of the observations made therein. However, the Tribunal held that the assessment on tum-over tax was made illegal but rejected the other points raised by the writ petitioners. Feeling aggrieved by this order of the Tribunal, this writ petition has been moved at the instance of the writ petitioner.
(2.) Mr. Soumen Bose, the learned Senior Counsel appearing on behalf of the writ petitioner at the first instance submitted that as the incentive scheme was formulated for promotion of industries and the said scheme was introduced on 27th May, 1994 by a Notification in which the preamble states "whereas the Governor is of opinion that industrial unit is manufacturing certain goods in West Bengal which are in need of financial assistance and accordingly it is necessary to formulate a scheme of industrial promotion to assist such unit for the purposes mentioned herein-above; the writ petitioner was entitled to tax exemption in terms of the Notifications mentioned herein-above and under Rule 41 of the West Bengal Sales Tax Rule, 1995 or under Rule 3 (116) of the 'Bengal Sales Tax Rules, 1941. Mr. Bose had also drawn our attention to some other similar notification which were also issued under the relevant provisions of the Sales Tax Act for exemption of sales tax on such items and copy of such Notification relevant for the writ petitioner's case has been annexed at page 36 of the writ petition. Mr. Bose also had drawn our attention to the Extraordinary Gazette dated 26th May, 1994 whereby, it was directed that no tax shall be payable under the Sales Tax Act, 1954 or 1941 Act and similar Notification was subsequently issued in the year 1994 by which exemption was granted on sale of fruit juice etc. Therefore, Mr. Bose contended that the expression "investment" on plant and machinery in the aforesaid exemption notification read with the incentive scheme makes it clear that the entire object of issuing such notification was for promotion of new industrial unit. Mr. Bose further contended that as the expression "investment" has not been defined in the Notification, such expression shall be construed in the context of the purpose of the Notification intended to be issued. In support of this submission Mr. Bose relied on a decision of the Supreme Court in the case of (1) Commissioner of Sales Tax v. Industrial Coal Enterprises, 114 Sales Tax Cases 365. He also cited another case reported in (2) 196 ITR 188, Bajaj Tempo Ltd. v. Commissioner of Income Tax. Relying on the aforesaid two decisions Mr. Bose contended that under the West Bengal Act and the Industrial Scheme, the policy of granting such incentive is to promote or setting up new industrial unit. Therefore, according to Mr. Bose, the expression 'investment' as used in the exemption Notification mentioned herein-above, should be construed in a way that the plant and machinery of the new industrial unit must be capable of being used at the time of starting production and that it cannot mean in this context that the plant and machinery which are obsolete or scrap long ago as from 1980 to 1986 be regarded as investment in 1994. Therefore, Mr. Bose submitted that having regard to the nature of the items used in fruit processing unit the plant and machinery which was discarded or replaced either as scrap or unuseable between 1980 to 1994 cannot be treated as 'investment' for setting up industrial unit in 1994. Mr. Bose further submitted that the earlier Assessing Officer under the 1954 Act making its assessment which was at page 32 of the writ application had taken the investment at less than 5 lakhs whereas another Assessing Officer in his later assessment did not make any estimate of the investment of the writ petitioner in respect of the plant and machinery on the date of restarting of the food processing unit as in the year 1994. Therefore, Mr. Bose contended that it was not open to the Assessing Officer to hold that the writ petitioners were not entitled to exemption of payment of sales tax under the Notification in question in view of the previous assessment order in which the exemption under the Notification in question was granted by the assessing officer. Therefore, Mr. Bose, contended that principles of res judicata should be applied in the facts and circumstances of the case and the Tribunal has erred in law by not holding that by applying the principles of res judicata the writ petitioners would be entitled to the exemption of payment of sales tax under the Notification in question in view of the earlier adjudication of the Assessing Officer in respect of the earlier assessment order. It was next contended by Mr. Bose that this case related to best judgment assessment. Relying on a decision of the Supreme Court in the case of (3) Raghuvir Mondal Harihar Mondal v. State of Bihar, AIR 1957 SC 810, and also in the case of (4) Sethia Mining and Manufacturing Corporation Limited v. Commercial Tax Officer, 1977 (Vol. 39) STC 246 Mr. Bose contended that the Assessing Authority did not take into account any of the materials namely, sales vouchers and bills both for cash and credit which were available in this very case. Therefore, Mr. Bose contended that the Assessing Authority had bifarcated the sales figure arbitrarily and with a motive in a manner whereby out of total turn-over of Rs. 1,18,000/- approximately he estimated sale of jam and jelly in respect of which the rate of tax was lowered i.e. 12% as Rs. 10,00,000/- and the sales of fruit juice squash at Rs. 1 Crore wherein the rate of tax was higher i.e. 12%. Accordingly, Mr. Bose submitted that this estimate was wholly arbitrary and motivated and, therefore, the Tribunal ought to have remitted this point also to the Assessing Officer inasmuch as the entire assessment was set aside by the West Bengal Taxation Tribunal and the Assessing Officer had in any event to make a re-assessment.
(3.) On the question of levy of interest Mr. Bose contended that in view of the latest decision of the Supreme Court in the case of (5) J. K. Synthetics Ltd. v. Commercial Taxes Officer, 94 STC 422 wherein the Supreme Court held that where interest is to be levied on "tax due" as provided in the Statement, such interest cannot be asked for unless there was an assessment of tax quantified and a demand notice was served. Mr. Bose after drawing our attention to Sections 10 and 10A of the Bengal Finance (Sales Tax) Act, 1941 and Sections 8 and 8A of the West Bengal Sales Tax Act, 1954 and Sections 30 and 31 of the West Bengal Sales Tax Act, 1994 submitted that interest would be payable only if the dealer had failed to pay the full amount of that "tax due" under this Act according to such return. Reliance was also placed by Mr. Bose to a decision of this Court in the case of (6) Recols India Limited, 4 STC 271. Mr. Bose, however, submitted before us that the aforesaid decision of this Court was a direct decision of a Special Bench of this Court with regard to the interpretation of what is meant by "tax due" and "tax payable" under the Bengal Finance (Sales Tax) Act, 1941. Therefore, Mr. Bose contended that interest was not payable in respect of the tax dues of the writ petitioners and in respect of such contention strong reliance was placed by Mr. Bose in the case of J. K. Synthetics Ltd. (supra). Finally it was contended by Mr. Bose that as the assessment was set aside by the Tribunal and the matter has to be re-assessed by the assessing authority, all the points mentioned above may also be considered and in any event by the order of the Tribunal the quantum of taxable turn-over has been reduced and further if the assessment is otherwise set aside on other ground, this question has to be considered by the Assessing Authority while the matter would be brought to its notice after the order of remand passed by the Tribunal. Accordingly, Mr. Bose contended that the order of the Tribunal is liable to be set aside on the submissions made by him noted herein-above.;