M/S. BIRLA CORPORATION LTD.versusSTATE OF RAJASTHAN AND ORS.

A                     M/S. BIRLA CORPORATION LTD.                                    ...
                                    v.
                     STATE OF RAJASTHAN AND ORS.

                                 MARCH 11, 1999

B             (S.P. BHARUCHA, S.S. MOHAMMED QUADRI
                         AND R.C. LAHOTI, JJ.]

         Rajasthan Tax on Entry of Motor Vehicles into Local Areas Act,
    1988:
c         S. 4(2)-Entry tax-Reduction to the extent of amount of tax paid under
    law relating to general sales tax-Held, not applicable to the tax paid on sale
    or purchase of specified goods or in specified circumstances under the Central
    Sales Tax Act-Central Sales Tax Act, 1956 s. 2(i)-constitution of
    India-Seventh Schedule-List I, Entry 92A and List II, Entry 54.
D
          The appellant assessee, manllfacturer of cement, purchased in the
    State of Tamil Nadu dumpers for its use in the State of Rajasthan and
    paid tax under the Central Sales Tax Act. On entry of the dumpers into
    the State of Rajasthan entry tax was demanded under the Rajasthan Tax
E   on Entry of Motor Vehicles Into Local Areas Act, 1988. The assessee
    claimed rebate under s. 4(2) of the Act, but the assessing authority raised
    a demand without giving the assessee the benefit of rebate. The assessee
    filed a writ petition before the High Court. The writ petition was trans-
    ferred to the Rajasthan Taxation Tribunal where it was dismissed. Ag-
    grieved, the assessee filed the present appeal.
F
          Dismissing the appeal, this Court

        HELD : Section 4(2) of the Rajasthan Tax on Entry of Motor
  Vehicles Into Local Areas Act, 1988 provides for a reduction to the extent
  of the amount of tax paid under the law relating to general sales tax.
G Section 2(i) of the Central Sales Tax Act while defining 'sales tax law'
  makes a clear distinction between a general sales tax law that provides for
  the Levy of tax on the sale or purchase of goods generally and a special
  sales tax law that provides for the levy of tax on the sale or purchase of
  specified goods or in specified circumstances .. Tax under the Central Sales
H Tax Act would clearly fall within the second category. That this is so would
                                       996
)




                    BIRLA CORPN. LTD. v. STATE [BHARUCHA, J.]                  997

    also be borne out by reference to Entry 54 of List II of the Seventh Schedule     A
    to the Constitution which empowers the State to levy taxes on the sale or
    purchase of goods and Entry 92A of List I which empowers the Centre fo
    levy taxes on the sale or purchase of goods when the same takes place· in
    the course of inter-State trade or commerce. [998-G-H]

            Orissa Cement Ltd. v. State of 01issa a11dA11r., [1970] 3 SCC 869, held   B
    inapplicable.

            CIVIL APPELLATE JURISDICTION : Civil Appeal No. 760 of
    1997.

          From the Judgment and Order dated 27.9.96 of the Rajasthan Taxa-            C
    tion Tribunal, Jodhpur in D.B.C.W.P. No. 2275 of 1994.

            B. Sen and Praveen Kumar for the Appellant.

            S.K. Jain and A.P. Dhamija for the Respondents.
                                                                                      D
            The Judgment of the Court was delivered by

           BHARUCHA, J. The assessee manufactures cement at Chittorgarh
    in the State of Rajasthan. It purchased dumpers for the purpose of its
    operations in the State of Rajasthan. The purchase was made in the State
    of Tamil Nadu. Tax was paid thereon under the provisions of the Central           E
    Sales Tax Act. When.the dumpers were transported into Rajasthan, entry
    tax was demanded thereon under the provisions of the Rajasthan Tax on
    Entry of Motor Vehicles Into Local Areas Act, 1988 ('the said Act'). The
    assessee claimed rebate of the tax under the Central Sales Tax Act that it
    had paid on the dumpers, invoking the provisions of Section 4(2) of the
    said Act. Upon a demand being raised by the assessing authority, without          F
    giving to the assessee the benefit of such rebate, the appellant filed a writ
    petition in the High Court of Rajasthan for a direction to the taxing
    authorities to give the same. The writ petition having been transferred to
    the Rajasthan Taxation Tribunal, it was dismissed by the judgment and
    order which is under challenge.                                                   G
                I
          The said Act provides for the levy of tax on the entry of motor vehicle
    into local areas of the State of Rajasthan for use and sale therein. The
    incidence of tax is provided for under Section 3 which states that a tax on
    the purchase value of motor vehicles shall be levied and collected if entry
    of the motor vehicles is effected into the local areas of the State for use or H
    998                  SUPREME COURT REPORTS                   [1999] 1 S.C.R.
                                                                                   ....
A sale therein at such rate or rates as had been notified for motor vehicles
    under the Rajasthan Sales Tax Act, 1954. For our purposes, the relevant
    provision is Section 4(2). Section 4 provides for deduction in tax liability
    and sub-section (2) thereof reads thus :

                "4(2) The amount of tax leviable under this Act shall subject
B           to such conditions as may be prescribed, be reduced to the extent
            of the amount of tax paid, if any, under the law relating to General
            Sales Tax as may be in force in any other State or Union Territory
            by an importer who, not being a dealer registered under the
            provisions of the Rajasthan Sales Tax· Act, 1954 (Act No. 2 of
            1954), had purchased the motor vehicle in that State for his own
c           use."

          The question is whether "the law relating to General Sales Tax as
    may be in force in any other State or Union Territory" includes the Central
    Sales Tax Act.
D
          The Central Sales Tax Act defines sales tax law and general sales tax
    law in Section 2(i) thus :

                "2(i) 'sales tax law' means any law for the time being in force
E           in any State or part thereof which provides for the levy of taxes on
            the sale or purchase of goods generally or on any specified goods
            expressly mentioned in that behalf, and "general sales tax law"
            means the law for the time being in force in any State or part
            thereof which provides for the levy of tax on the sale or purchase
            of goods generally."
F
         There is a clear distinction, therefore, between a general sales tax
  law that provides for the levy of tax on the sale or purchase of goods
  generally and a special sales tax law that provides for the levy of tax on the
  sale or purchase of specified goods or in specified circumstances. Tax
G under the Central Sales Tax Act would clearly fall within the second
  category. That this is so would also be borne out by reference to Entry 54
  of List JJ of the Seventh Schedule of the Constitution which empowers the
  State to levy taxes on the sale or purchase of goods and Entry 92A of List
  I of the Seventh Schedule which empowers the Central to levy taxes on the
  sale or purchase of goods when the same takes place in the course of
H inter-State trade or commerce.
                     BIRLACORPN. LTD. v. STATE[BHARUCHA,J.)                      999

              Our attention has been invited by learned counsel for the appellant       A
       to the judgment of this Court in Orissa Cement Ltd. v. State of Orissa and
       Anr., [1970] 3 SCC 869. The Orissa Sales Tax Act, 1947 gave the assessee
       a rebate if he made prompt payment of the tax due. The question was
       whether that stimulus was a part of the manner of collection, in which
       event, by reason of Section 9{3) of the Central Sales Tax Act, it would be
       available to an assessee thereunder. This Court held that the rebate was
                                                                                        B
       offered to facilitate and expedite. collection. It was intended to stimulate
       the collection. It was, therefore, a part of the process of collection and, by
       reason of Section 9(3), was available to an assessee malcing payment of tax
       due under the Central Sales Tax Act within the time prescribed in the
       relevant provision of the Orissa Sales Tax Act. We do not think that this        C
       judgment can be of any assistance here. The basis of that judgment was a
       provision of the Central Sales Tax Act, namely, Section 9{3); no such basis
       is available in the present case.

             The issue of constitutionality of Section 4(2) of the said Act was not
....   raised in the writ petition filed by the appellant and we do not express any     D
       opinion thereon.

              The appeal is dismissed with costs.

       R.P.                                                      Appeal dismissed.




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