Kailash Roller Flour Mills And Others v. Assistant Commissioner Of Commercial Taxes And Others

S.K Jha, J.:— There seems to be no end to the conundrums suggested at the Bar regarding the interpretation of two notifications which I shall hereinafter mention and, I suppose, there will be no end to those conundrums until such notifications are effaced and fresh notifications, if any, in more concise and unequivocal terms are issued should the State Govt. so choose. The two notifications in question are both dated the 18th of January, 1977 being S.O Nos. 139 and 141 issued by the State Government, the former relating to the exemptions of general sales tax and special sales tax on sales of finished products by newly set up small scale industrial units and the latter granting exemption from the levy of both ‘general Sales-tax’ and ‘Special sales tax’ or ‘Purchase tax’ on sales of such raw materials to the owners of the newly set up small scale industrial units. So far as C.W.J.C Nos. 214/79(R) and 173/77(R) are concerned, the question involved is merely the interpretation of notification No. 141 aforementioned whereas in the other writ applications, which fall for our aforementioned consideration, both the notifications (Nos. 139 and 141) aforementioned are involved. It may be worthwhile to mention here that so far as C.W.J.C Nos. 10 and 244 of 1979 (R) are concerned, there is an additional point involved which shall be dealt with while dealing with those cases. Since principles of construction of the notifications in question would be the same affecting either one or all of these cases, I propose to deliver this common judgment dwelling upon the interpretation of the notifications in question and then apply the principle evolved to the facts of each particular case. I therefore, intend by this common judgment to decide the paramount question of law involved in the first instance and then refer to relevant facts relating to each case and the reliefs claimed in the case which ought or ought not to be allowed.

2. This then impels me to go to interpret straightway the true meaning and purport of the notifications in question, namely, S.O Nos. 139 and 141 both dated 18-1-77 as aforementioned. Even so, it would be worthwhile to bear in mind that the interpretation of one notification will govern the interpretation of the other also because the only important difference between the two notifications, as I have hinted at earlier, is that so far as notification No. 141 is concerned, it relates to exception from the levy of general sales tax and special sales tax or purchase tax in respect of sales of raw materials to the owner of newly set up small scale industrial units whereas S.O No. 139 relates to the exemption from the levy of both general sales tax and special sales tax on sales of finished products to the owner of the newly set up small scale industries at the first stage of sale after production.

3. To deal with the interpretation of S.O No. 141 first, it may not be out of place to give a short history, admitted as it is, of the statutory notifications in respect of exemption from the levy of both general sales tax and special sales tax or purchase tax on sales of raw materials to the owners of such industrial units. Under the Bihar Sales Tax Act, 1959 (Bihar Act XIX of 1959), hereinafter referred to as the Act, Section 4 provides for exemption of taxes on sales or purchases of goods of certain categories. Section 4(3)(b) of the Act provides that the State Government may, by notification and subject to such conditions or restrictions as it may impose, exempt from the levy of the general sales tax or special sales tax or both or the levy of purchase tax sales of any goods or class or description of goods or by any class of dealers' “By virtue of such powers vested in the State Government, by a notification No. S.T.G.L-E-1013/69-99-26 F.T dated 19-9-1969 the Governor of Bihar was pleased to exempt from the levy of both ‘general sales tax’ and ‘Special sales tax’ sales of such raw materials to the owner of newly set up small scale industries unit approved and registered by the Industries Department of the Government of Bihar for a period of five years from the date the industry starts its production as are specified in the certificate in form ‘H’ obtained by him from the relevant authorities of the Commercial Taxes Department after filing an application in form ‘A’ and subject to certain conditions. We are not concerned in these cases with the conditions attached. The explanation incorporated in the notification read thus:

1. ‘Small scale industry’ means in industrial unit with an investment upon Rs. 7.5 lacs on plant and machinery excluding the value of land-and building and is approved and registered by Industries Department of Government of Bihar.

2. Newly set up small scale industrial units include such units which have already been set up but have not yet completed a period of 5 years from the date of starting production.

3. This notification shall remain in force from the 19th June, 1969 to 31st March, 1974.

4. And then we find notification No. S.T.G.L-1023/73 S.O 353 dated 14-3-1974 which was, for all practical purpose, in identical terms and which expressly mentioned that the explanation to this notification of 1974 would be the same as in notification No. 9925 dated 19-9-1959. This notification was sought to come into force with effect from 1st April, 1974 and was to remain in force till 31st March, 1979. This exemption, however, was withdrawn by the Government of Bihar with effect from 1-7-1976 under notification No. S.O 1082 dated 30-6-1976. Then came the notification dated 18-1-1977 numbered S.O 141 the relevant portions of which I shall reproduce hereinafter but before I do that, in the fitness of things, it must be said that the Act was repealed by Bihar Sales Tax Ordinance 309 of 1976 and subsequent Ordinances in identical terms, namely, Ordinances Nos. 30/77, 38/77, 101/77, 163/77, 208/77, 221/77, 257/77, 34/78 and 97/78. Notwithstanding such repeal, by virtue of Section 54(2) of the 1976 Ordinance and subsequent Ordinances, the notifications issued under the Act continued to remain in force and retained their validity.

5. I may now reproduce the relevant portions of notification No. S.O 141:

“The Governor of Bihar is pleased to exempt from the levy of both ‘General Sales Tax’ and ‘Special Sales Tax’ or ‘Purchase Tax’ sales of such raw materials to the owner of newly set up small scale industrial unit approved and registered by the Industries Department of the Government of Bihar for a period of five years from the date the industry starts its production, as are specified in the certificate in form ‘B’ (appended hereto) obtained by him from the Assistant Commissioner/Superintendent of the Circle where the industry is established after filing an application in form ‘A’ (appended hereto) and are required by him directly for use in the manufacture of goods for sale within the State or in course of inter-state Trade or Commerce or export outside the territory of India, subject to the condition that.”

6. Explanation:

1. Small scale industries means an industrial unit with an investment upto Rs. 10 Lakhs on plant and machinery excluding the value of land and building and approved and registered by Industries Department of Government of Bihar and accepted as small scale industry after verification by the Assistant Commissioner/Superintendent of Commercial Taxes of the Circle within whose jurisdiction such industry is situated.

2. Newly set up small scale industrial units include such units which have already been set up but have not yet completed a period of 5 years from the date of starting production.

7. This notification shall come into force with effect from 1st July, 1976 and shall remain in force till 31st March, 1979.

8. I have deliberately omitted to quote the conditions laid down in form ‘A’ and ‘B’ and ‘C’ appended to the notification for they have no relevancy for the purpose of deciding these cases. According to the contention of Mr. A.K Sen and Dr. D. Pal, learned counsel appearing on behalf of the petitioners, the notification exempting the taxes on sales of the specified raw materials is to remain available for a period of five years from the date the industry starts its production whereas, according to the stand taken by the respondents, the exemption granted under the notification to the owner of any newly set up small scale industrial unit can in no case be available to him beyond 31st March, 1979. This is the primary question which falls for our consideration in these cases.

9. Although learned counsel for the parties dwelt at some length upon the duty of the Court either to have a ‘literal approach’ or ‘purposive approach’ as was thought to suit either of the contesting parties this distinction between the literal approach and the purposive approach, as Lord Diplock termed them in the case of Kammins v. Senith Investments Ltd.(1), is of little consequence in construing the notification in question. The more apt and universally accepted principle of construction of such Statutes or statutory instruments to be applied in the instant cases is that the Statute or the instrument must be read as a whole and we should resort to a construction which would not leave without effect any part of the language used in the notification. The notification has to be read as a whole, absurdities have to be avoided and a meaning has to be given to every part of the notification and all possible or apparent anomalities have to be reconciled. I shall, therefore, look to the express language used. The exemption from the levy of general sales tax, special sales tax or purchase tax on sales of specified raw materials to the owners of newly, set up small scale industrial units as approved and registered by the Industries Department has been expressly and unequivocally granted for a period of 5 years from the date the industry starts its production. That is a substantive and operative part of the notification. It admits of no ambiguity at all. Although the notification dated 18-1-1977 has been made effective retrospectively from 1st July, 1976, by clause 2 a legal fiction has been created to embrace within the definition of small scale industrial units such units as have already been set up before the commencement of the notification but had not completed a period of 5 years from the date of starting the production. The dominant intention, or if I may say so, the only intention by the express words used either in the first substantive portion of the notification or in the legal fiction created by clause 2 is to grant an exemption for a period of five years from the date the production starts. To take an example, supposing a newly set up small scale industrial unit started its production, say, on 1st May, 1972 but had not completed a period of 5 years, from the date of production started, on 1st July, 1976, it shall yet be given the immunity from levy of the taxes mentioned above on purchase of raw material upto 30th April, 1977. So also in the case of an industrial unit (small scale) which had started production on 1st April, 1974, it will be granted the exemption for a period of 5 years ending on 31st March, 1979. This position was conceded by the learned State Counsel appearing for all the respondents. I, therefore, can see no reason as to why a newly set up small scale industrial unit starting production on, say, 2nd July, 1976 shall not be granted an exemption for a period of 5 years from the date of start of production, namely, upto 1st July, 1981. Why should the period of exemption granted by the notification for a period of 5 years be cut down in such cases. But then Mr. Ramnandan Sahai Sinha, learned Government pleader appearing for the respondents, tried to persuade us to whittle down the impact of the period of 5 years by inviting our attention to the fact that the notification was to remain in force only till 31st March, 1979 and, therefore, no exemption under the notification could extend beyond that date. I intend to test the validity of this contention by taking a more extreme case. Say, for example, a small scale industrial unit Z was set up on 1st January, 1977 and it started production, say, on 2nd January, 1977. Then according to the contention of learned Government Pleader, Z will get an exemption not for a period of 5 years from the date of start of production but for a period of 2 years and a little more. Does not look absurd? Will not such a construction lead to absurd inconvenience and anomalous situation? Let us test in the background of the previous notification which, I think, in the circumstances of these cases it shall be legitimate for me to do. A small scale industrial unit set up after 1st April, 1974 and having started its production on 2nd April 1974 was to get an exemption for 5 years under the notification of 1974 which was also to lapse on 31st March, 1979. The 1974 notification, as I have already mentioned above, was reseinded by the 1976 notification with effect from 1st July, 1976 and yet that small scale industry gets advantage of this full 5 years' period or a little less under the notification in question, namely No. 141 dated 18-1-1977. Was the intention of the State Govt. to create such absurdities, anomalies and disparities? What was the purpose of granting these exemptions to the newly set up small scale industries? The answer as admitted at all hands, is to give incentive to the public to establish small scale industrial units in this still underdeveloped industrial State. Learned Counsel for the petitioners submitted that having unequivocally represented to the people investing capital upto 10 Lacs of rupees for setting up a small scale industrial unit that they shall be immune from the levy of general sales tax and special sale tax or purchase tax for a period of 5 years from the date of start of its production, and such a representation of an owner having so invested his money over the industrial growth on small scale of the State during the effectiveness or continuance of the notification in question, how can he be sought to be deprived of the exception clause by the authorities of the Commercial Taxes Department which would be at liberty to cut down the period of exemption to a ridiculous farce in the case of newly set up small scale industrial units starting production, say, sometime in January, 1979? There is much force in this contention. I may not be misunderstood to mean that I am invoking the principles of quasi estoppel or equitable estoppel or promissory estoppel in such cases. All I wish to emphasise is that the construction put upon the statutory instrument by the learned State Counsel would lead to manifest injustice, absurd inconvenience and ridiculous anomalies and that too in the face of unequivocal, express language of the notification itself which has not minced words to say that the exemption shall be granted for a period of 5 years from the date of start of production. The Learned Government Pleader then confronted, if at all that expression may be used, with the question as to what would be the meaning to be given to the last part of the notification which says that it shall remain in force till 31st March, 1979 only. I, for one, wish to retort that this so-called or apparent anomaly which the Learned Government Pleader sees in the notification is not an anomaly at all and it can very well be reconciled with the period for exemption for 5 years. Clause 2 of the notification, namely, that it shall be deemed to have come into force with effect from 1st July, 1976 and, shall remain in force till 31st March, 1979 can in the circumstances, mean, according to me, only this: that any small scale industrial unit set up and starting production on and from 1st July, 1976 and upto 31st March, 1979 or such unit as has not completed 5 years from the date of start of production on 1st July, 1976, shall be entitled to the exemption of the taxes concerned for a period of 5 years from the date of start of production. This will lead to no anomaly. This construction will give effect to every word used in the notification. This construction would be in consonance with the fulfilment of the desire of the State Government to have industrial growth in the Stats within the period stipulated. All anomalies shall be resolved by such construction and no absurd inconvenience is to follow no manifest injustice is to result. This, therefore, is how I construe the true meaning and purport of notification No. S.O 141 dated 18-1-1977. In doing so, I must make it clear, lest I be misunderstood, that I am not oblivious of one of the well settled principles of construction of taxing statutes that, as Lord Young said in Hogg v. Parochial Board of Auchtermuchty(2), as quoted by Craiss on Statue law, 7th Edition, page 116:

“in dubic, I should deem it the duty of the Court to reject any construction of a modern statute which implied the extension of a class privilege reasonably admitted of another interpretation.”

10. For the purpose of construction put by me, I have taken the language of the notification which does not even reasonably admit of another interpretation, but, perchance, as was contended by learned counsel for the petitioners, two interpretations were possible even in cases of exemption, the interpretation more favourable to the assessees should be preferred, as was done in the case of Alladi Venkateswarlu v. Government of Andhra Pradesh (3), where while dealing with the cases of exemption under the Andhra Pradesh General Sales Tax Act, 1957 and the validity of such an exemption, it was held towards the end of paragraph II:

“in any case, if two interpretations of a provision are possible, we think that we ought to, in such a case, apply the principle that the interpretation which favours the assessee should be preferred.”

11. It would fall upon me to construe the other notification, namely, S.O 139 dated 18-1-1977. As I have already hinted at the earlier, the only important difference between the notification which I have already construed and this notification is that the other notification dealt with exemption of levy of the taxes mentioned therein on sales to owners of newly set up small scale industrial units whereas this notification (S.O 139) deals with exemption from the levy of general sales tax and special sales tax on finished products at the first stage of sale for a period of 5 years from the date of start of production. I may usefully exphasise this difference between the two notifications by extracting the relevant portion of S.O 139 here:

“S.O 139. In exercise of the powers conferred by clause (b) of sub-section (2) of Section 4 of the Bihar Sales Tax Act, 1959 (Bihar Act XIX of 1959), Governor of Bihar is pleased to exempt from the levy of both ‘Central Sales Tax’ and ‘Special Sales tax’ sales of finished products by newly set up small scale industries which have already gone into production prior to 1st July, 1976 at the first stage of sale after production for a period of 5 years from the date of industry starts its production……”

12. In all other respects for all relevant purposes, the provisions of this notification are mutatis mutandis the same as in notification No. S.O 141 dated 18-1-1977. Even in respect of the historical background calshating is this notification, both the notifications in question stand at par. Even the dates of the earlier notifications in respect of exemption on sales at first stage are the same as relating to the exemption from levy of purchase tax, etc. on the sales of raw materials to the owners of the newly set up small scale industrial units.

13. Following the same principles of constructions as I have done in respect of notification No. 143 and construing the matter in all its notification. I have no hesitation in holding that even in respect of notification No. 139 the exemption from levy of both general sales tax and special sales tax on sales of finished products by newly set up small scale industries which have already gone into production prior to 1st July 1976 at the first stage of sale after production shall be for a period of 5 years from the date the industry has started its production irrespective of the notification refraining in force till 31st March, 1979 only.

14. The primary duty of interpreting these statutory notifications having been discharged, I shall now proceed to the relevant facts, short as they are of each individual case to find on the construction put by me, to what extent, if any, are the petitioners in these cases entitled to any relief.

Individual Cases

C.W.J.C 173 of 1977 (R).

15. The petitioner is a partnership registered in the same and style of Kailash Rolling Flour Mills under the Indian Partnership Act, 1932 with the Registrar of Firms having its factory situated in the Adityapur Industrial Area, Gasaria in the district of Singhbhum. The firm carries on the business inter alia, of manufacture and sale of sheet products, namely: Maida, Sujji, Atta and Bran. It is a small scale industries unit registered as such with the Adityapur Industrial Area Development authority under a registration certificate dated 14th July, 1976 issued by the Managing Director, Adityapur Industries, Government of Bihar. In the certificate it is recorded that date of commencement of production was 19th May, 1974. A copy of the aforesaid certificate has been marked Annexure 1, it may thus be seen that the petitioner started production on a date has the 1974 notification was in force and had not completed a period of 5 years from such date. The petitioner requires wheat as raw material for use in the manufacture for sale. By a letter covering an application in the prescribed form and both dated 30th March, 1977 addressed to the Assistant Commissioner of Commercial Taxes, Jamshedpur Circle, respondent, the petitioner prayed for the issuance of an appropriate certificate of exemption in the prescribed form under notification No. S.O 141. Both the letter and the application in form and have been collectively marked Annexure 2/3. This application, it seems, was perhaps received in the office of respondent 1 on 31-3-1977. Respondent by his order dated 19-5-1977, a copy whereof has been marked Annexure 3, accepted the positions that the petitioner started production on 10-5-1974. He, however, held that the petitioner's factory had been approved and recognised by the Department of Industries as a small scale industrial unit on 9-6-1976 and it had filed the petition for exemption certificate on 31-3-1977. Therefore the petitioner was entitled to tax exemption certificate with effect from 31-3-1977 which was the date of filing the petition till 31-3-1979. He, however, also held that since the date of start of production was 10-5-1974, the relief of not collecting sales tax from customers and of not depositing the sales tax in the department, which has been enjoyed by the small scale industrial unit before 1-7-1976, be also granted to the petitioner. In pursuance of the aforesaid order of respondent I, a certificate of exemption with effect from 31-3-1979. He, however, also held that sine the date of start of production was 10-5-1974, the relief of net collecting sales tax from customers and of not depositing the sales tax in the Department, which has been enjoyed by the small scale industrial unit before 1-7-1976, be also granted to the petitioner. In pursuance of the aforesaid order of respondent No. 1, a certificate of exemption in the prescribed form dated May 20, 1977 (Annexure 3.a) was issued to the petitioner, the relevant portion of which reads as follows;

“This is to certify that sales to Kailash Roller Flour Mills of raw materials as specified in item 4 below shall be exempted from the levy of both general sales tax and the special sales tax or purchase tax.”

16. This certificates valid upto 31-3-1979. Thereafter followed the particulars with which we are not concerned.

17. In this application the petitioner has challenged the validity of the aforesaid order of respondent 1 marked Annexure 3 and the certificate in para 3 marked 3/2 aforementioned. The grievance of the petitioner is that it having been recognised and approved by the Industries Department, as I have said above, as a small scale industrial unit and it having started its production on 10-6-1974, it was entitled to an exemption from the relevant taxes on purchases of raw materials upto 9-5-1979 and not only upto 31-3-1979. According to the construction that I have put on notification No. S.O 141, the petitioner's contention must be held to be valid. A writ of certiorari is, therefore, issued questioning that part of the order (Annexure 3) passed by respondent 1 on 19-5-1977 as well as of exemption certificate in form B dated 20-3-1977 (Annexure 3/2) by which the exemption certificate has been granted only upto 21-2-1979 and a writ of mandamus is issued to the respondents to rectify the exemption certificate's validity date upto 9-5-1979. It may not be out of place to point out here that although the exemption certificate is form Bought to have been issued under notification No. S.O 141, it has been wrongly issued under notification No. S.O 139. That also must be correct by respondent No. 1.

C.W.J.C No. 214 of 1979 (R).

18. This case is also concerned with notification No. S.O 141 only. The petitioner Shakti Chemical and Fertiliser Pvt. Ltd., is a private limited Company under the Companies Act, 1956, having its Registered Office at Lokal, Kodarma in the district of Hazaribagh. It carries on the production and sales of fertiliser gramules as a small scale industry. It is duly registered and approved as a small scale industrial unit by the Directorate of Industries, Government of Bihar. Initially as a temporary basis by an order dated June 19, 1976 and subsequently as a permanent basis June 19, 1976 and subsequently on a permanent basis by an order dated 14-9-1978. The petitioner's factory admittedly started its production on and from 2nd June, 1979. The petitioner applied to the Additional Superintendent of Commercial Taxes, Koderma, Special Circle Jhumritlaya: who was competent authority, for renewal of its exemption certificate as 25th March 1979, as the original certificate of exemption in form D was expiring on 31-3-1979. A copy of this letter has been marked Annexure 2. Alongwith this letter the original certificate of exemption (Annexure 2) was also enclosed, the endorsement on which at the left hand side showed that the exemption was valid till 31-3-1979. On the application of the petitioner (Annexure 3) itself, respondent 2 passed an order to the effect that so for the Department had not received any Government order with regard to extension of relief of exemption for small scale industry beyond 31-3-1979 and, therefore, the question of extension of the exemption certificate beyond 31-3-1979 was not possible. The petitioner challenges this order of respondent 3 as incorporated in Annexure 3. This petition must succeed on the same ground as C.W.J.C 173 of 1977 (E). The petitioner is entitled to the relief of exemption of general sales tax, special sales tax or purchase tax on the sale of raw material made to it for a period of five years with effect from the start of production, namely, 2nd June, 1979. In other words, the petitioner is held entitled to such an exemption by virtue of notification No. S.O 141 upto 1st June, 1953. Unless, the meantime such an exemption is withdrawn by any further notification which may be issued by the state Government. I am, therefore, constrained to quash the order passed by respondent 3 on the application made by the petitioner (Annexure 3) itself and issue a writ of mandamus commanding respondent 3 and/or other respondents, who may be competent to deal with the matter, to extend the exemption as prayed for by the petitioner in pursuance of notification No. S.O 141 for a period of five years from the date of start of production aforesaid mentioned.

19. By an order dated 9-4-1979 when the application was admitted by a Bench of this Court and a rule also issued an interim order was passed by the Court restraining the respondents from realising and/or taking any steps for the imposition and realisation of purchase tax on raw materials in respect of the purchase effected by the petitioner subject to the condition that the petitioner shall furnish a bank of India, Koderma Branch, in this Court within 10 days from the date of the order. The petitioner complied that this order in time when the matter with regard to the interim relief came up for final hearing, both the parties were heard and a Bench of this Court made the order of interim stay (injunction) absolute on 17-5-1979 subject to further condition that the petitioner would furnish another bank guarantee for a further sum of Rs. 18,000/- within one month from 15-5-1979, we have been given to understand that this order was also duly complied with. As a result of the petitioner's success in this application, the two bank guarantees furnished by the petitioner in pursuance of the two orders of this Court shall stand discharged.

C.W.J.C 192 of 1979 (R);

20. In this writ petition the claim of exemption made by the petitioner is under both the notifications, namely Nos. 141 and 139.

21. The petitioner is a partnership firm registered under the Indian Partnership Act, the names of the partners having been enumerated in paragraph of the petition. It carries on the business of manufacture and sale of K.C Wire, aluminica wire, wire nail and copper wire. It has its factory for the manufacture of wire and wire nail at Sundarnagar, Tatanagar (Jamshedpur). It is a small scale industrial unit duly registered with the Directorate of Industries of the State Government under a registration certificate dated 12-4-1977. The production of the said factory started from 23-4-1976 which is borne out by certificate itself, a copy whereof has been marked Annexure 1. On 15-4-1977 the petitioner made an application for exemption certificate under both the notifications in question, which is apparent from the order dated 16-4-1977 passed by the Assistant Commissioner of Commercial Taxes, respondent I, which is incorporated in Annexure (3)(a) on the basis of the aforesaid order an exemption certificate in prescribed form was issued on 18-4-1979 granting exemption to the petitioner only upto 31-3-1979. A copy of the aforesaid certificate of exemption has been marked Annexure 3(b). The petitioner thereafter filed a revision application before the Joint Commissioner of Commercial Taxes, Jamshedpur Division, respondent 2, complaining, that it was entitled to get exemption for a period of 5 years from the date of start of production namely, 23-6-1976), i.e, upto 22-6-1981. A copy of the revision application has been marked Annexure 4. By an order dated 17-3-1979 (Annexure 5) the Joint Commissioner, respondent 2, rejected the petitioner's revision application and upheld the order of respondent 1 granting exemption only upto 31-3-1979. The petitioner has challenged the legality and validity of the said order dated 14-4-1977 (Annexure 3.a), the exemption granted only upto 31-3-1979 (Annexure 3.b) and the revision order dated 17-3-1979 (Annexure 5) passed by respondent 2.

22. For the reasons hereinbefore given, the petitioner is entitled to the relief as prayed for. A writ of certiorari is issued quashing that part of the order of respondent and that of the certificate (Annexure 3.b) by which the exemption has been granted only upto 31-3-1979 as also the revisional order of respondent 2 and a writ of mandamus is issued to the respondents to rectify the certificate of exemption (Annexure 3.b) granted to the petitioner for a period ending on 22-6-1981, subject, of course to the State Government issuing any fresh notification revoking the exemption.

23. In this case also when the application was admitted and a rule nisi issued on 30-3-1979, a Bench of this Court passed an interim order restraining the respondents from realising and/or taking any step for the imposition and realisation of the sales tax and purchase tax both in respect of the sales and purchases affected by the petitioner subject to the condition that the petitioner would furnish a bank guarantee to the extent of Rs. 10,000/- on the State Bank of India, Jugsalui Branch, within 10 days of that order. We are informed that the petitioner has complied with that order of this Court. In view of the petitioner's success in this case, the bank guarantee furnished by the petitioner in pursuance of this Court's order dated 30-3-1979 shall also stand discharged.

C.W.J.C 314/79 (R):

24. In this case also the points involved are identical to those in C.W.J.C 79(R).

25. The petitioner is a partnership firm registered under the Indian Partnership Act, the partners' names having been given in paragraph 3 of the writ petition. It carries on the business of manufacture and sale of Ferro Venedius It has its factory for the manufacture of the aforesaid material at Ranchi. It is duly registered as a small scale industrial unit with the Directorate of Industries of the State Government under a registration certificate dated 23-3-1977, a copy whereof has been marked Annexure 1 to the writ petition. From the certificate (Annexure 1) itself it appears that the production in the said factory started from 23-4-1976. By an order dated 14-4-1977 (Annexure 3) passed by Asstt. Commi. of Commercial Taxes, respondent 1, the petitioner was ordered to be granted exemption only upto 31-3-1979 both under notifications 141 and 139. Pursuant to the aforesaid order a certificate of exemption in form B (Annexure 3.a) was issued on 15-4-1977 to the petitioner valid only upto 31-3-1979. The petitioner, it seems, under an erroneous impression filed an application for review before the Assistant Commissioner of Commercial Taxes, Ranchi North Circle, respondent 3, who rejected the same on 3-3-1979, a copy of which order has been marked Annexure 5. On these facts, I hold that the petitioner is entitled to exemption under both the notifications, namely S.O 141 and S.O 139, for a period of five years starting from 28-4-76 and ending on 27-4-1981, subject, of course, to any fresh notification revoking the exemption being issued by the State Government.

26. In this case also in pursuance of order dated 18-5-1979 passed by a Bench of this Court, the petitioner furnished a bank guarantee of a sum of Rs. 15,000/- as a condition for the inter alia relief that the respondents to be restrained from realising both sales tax and purchase tax. In view of the fact that the petitioner has succeeded in this application and that a writ of certiorari is issued quashing that part of the impugned annexures by which the petitioner has been granted exemptions certificate only upto 31-3-1979 and a writ of mandamus is issued to the respondents commanding them in the term aforementioned, the petitioner shall stand discharged from the bank guarantee furnished by it.

C.W.J.C 10/79 (R):

27. The petitioner is a partnership firm and is manufacturing dal from cereals under the name and style of Messrs Gopal and Oil Mills at Ranchi. It started production on and from 17-3-1974. It is admittedly a small scale industrial unit duly approved and registered by the Industries Department. On 26-6-3974 an order was passed for grant of exemption certificate to the, petitioner valid upto 16-3-1979 which was prepared, dated and signed and was ordered to be issued. This is borne out by the order dated 25-6-1974 which is a part of the order sheet contained in Annexure 10 to the petitioner's reply to the counter affidavit filed on behalf of the respondents. Pursuant to the order, a certificate of exemption was duly issued, to the petitioner in form-B clearly mentioning that the certificate was valid upto 16-3-1979. A copy of this certificate has been marked Annexure 3 to the writ petition. On 4-12-1976, however, the Commissioner of Commercial Taxes, Bihar, respondent 2, issued letter No. 137 to all officers in charge of circles directing them to restrict the validity of exemption upto the month of March, 1977 only. A copy of the aforesaid letter has been marked Annexure 4. In the said letter there is some reference to a circular of the industries of department on the basis of which this restriction was sought to be imposed. The petitioner was thereafter called upon to produce its exemption certificate in form B (Annexure 3), at the top right hand side of which the certificate was re-validated for the period upto 31-3-1977, duly signed by the Assistant Commissioner, respondent 4, and dated 25-5-1977.

28. The petitioner has raised a grievance with regard to the legality of the change in the date of validity of the exemption certificate from 16-3-1979 to 31-3-1977 only and has also attached the letter issued by the Commissioner in so far as the petitioner's industrial unit is concerned.

29. As is evident, from the facts stated above, the petitioner was originally granted an exemption for a period of full five years. By virtue of the letter of the Commissioner, respondent 2, the period of validity of the exemption certificate was reduced from 16-3-1979 to 31-3-1977. When called upon by the Learned Government Pleader to state as to on what basis such a letter was issued and such a restriction to the prejudice of the petitioner was imposed in Annexure 3, the original exemption certificate, by reducing the period, he was unable to support the stand of the respondents. He was not able to show to us any notification of the State Government which could in any way whittle down the effect of the notifications S.O 141 and S.O 139 with regard to the Dal Mills although they were newly set up. I am constrained to quash the endorsement on the right hand side (top) of Annexure 3 by which the validity of the exemption certificate was changed from 16-3-1979 to 31-3-1977. Let a writ of mandamus, therefore, issue to the respondents to restore the validity of the petitioner's exemption certificate as contained in Annexure 3 upto 16-3-1979 as was originally done by respondent 4 himself.

C.W.J.C 244/79 (R);

30. The point involved in this case is identical to that in C.W.J.C 10/79 (R).

31. The petitioner is a partnership firm duly registered under the Indian Partnership Act, the names of the partners having been given in paragraph 1 of the petition. The petitioner carries on the business of manufacture and sale of Dalmot and satin from 24-7-1974 and manufacture and sale of pulses from 24-10-1975. It has its factory for the manufacture of Dalmot and Sattu and pulses in the town of Ranchi. It is a small scale industrial unit duly registered by the Directorate of Industries of the State Government under registration certificate dated 12-5-1977. As has already been stated above, the petitioner started production of Dalmot and Sattu on and from 24-7-1974 and of pulses from 24-10-1975. A copy of the aforesaid registration certificate has been marked Annexure 1.

32. By an order dated 9-9-1974, the Assistant Commissioner of Commercial Taxes, respondent No. 1, recorded that the petitioner was a small scale industrial unit and was registered as such and that its first production started on 24-7-1974. The petitioner was, therefore, eligible for grant of exemption. This order is a part of the order sheet (Annexure 3). As a result of the aforesaid order, a certificate of exemption from the levy of both general sales tax and special tax as well as purchase tax was issued in form B and it was specifically mentioned in the certificate that it would be valid upto 31-3-1979. A copy of the certificate has been marked Annexure 3.a. On 5-9-1975 the Industrial Development Commissioner, respondent, issued a circular to the effect that the Government had decided to deprive the industries specified therein from the facilities granted under the same resolution dated 29-5-1973. The special industries included Dal Mill. It was, however, stated that such industries shall continue to remain registered as small scale industry but they will not get any facility except assistance for financial institution, on 11-5-1976, however, a circular was issued by the industries Department restoring the exemption to 31-3-1977 to Dal Mills. On 4-12-1974 the Commissioner of Commercial Taxes, respondent 3, issued a circular letter to the effect that in view of the Industries Department's circular referred to above, the exemption facilities would be made available to these industries upto 31-3-1977. It appears from the order dated 2-5-1977, which is a part of Annexure 3, that the benefits of exemption from payment of sales tax on purchase of raw materials as well as on sale of finished goods having been restored under notification Nos. S.O 141 and S.O 139 the exemption certificate be revalidated. It was accordingly revalidated upta 31-3-1979 as already, mentioned above. By an order dated 28-7-1977, however, which also forms part of Annexure 3, respondent 1, circulated to amend the exemption certificates making it valid only upto 31-3-1977 in pursuance of a resolution dated 11-5-1976 of the Industries Department and communicated by a letter dated 4-12-1976 of the Commissioner of Commercial Taxes, respondent 3, in respect of the Mills producing dal.

33. For the reasons as given in C.W.J.C 10 of 79 R. the order dated 28-7-1977 passed by respondent I, cannot be sustained and the direction for amendment of the exemption certificates valid only upto 31-3-1977 is quashed. The petitioner undoubtedly being a newly set up small industrial unit and having started its first production on 24-7-1974 would be entitled to an exemption under both the notifications for a period of five years from the date namely, upto 23-3-1979. Both the orders, therefore, namely the initial one granting the validity of the exemption certificate upto 31-3-1979 and the revised one restricting it upto 31-3-1977 are held to be bad and are quashed. Let a writ of mandamus issue to the respondents to grant certificate of exemption in terms of both the notifications No. S.O 141 and S.O 139 to the petitioner upto 23-7-1979. There is, however no force in the contention of Dr. Pal that the petitioner should be granted an exemption in respect of Dal Mill upto 23-10-1980, as the production of pulses had started on 24-10-1975. It is not the intention of the notifications in question to grant an exemption in respect of each item of production or finished goods for sale. If there is a small scale industrial unit registered for production of a number of items and even if it starts production of one item under its registration certificate the date of production shall be computed from the date when such an Industrial Unit has started the first production of any one of the items.

34. In the result, therefore, all these writ applications are allowed in the terms as mentioned in each of the cases. In the circumstances of the cases, however, I shall make no order as to cost.

35. G.M Mishra, J.:— I agree.