J.K. Lakshmi Cement Ltd. Vs Commercial Tax Officer (Supreme Court of India)
Summary: The Supreme Court examined whether J.K. Lakshmi Cement Ltd., a manufacturer of grey Portland cement in Rajasthan, could avail itself of two tax concessions during the same assessment year. The State Government’s notification dated 6 May 1986 provided partial Central Sales Tax exemption linked to increased interstate sales relative to the base year 1984-85, while its notification dated 21 January 2000 provided a concessional 6% rate on interstate cement sales subject to conditions. The latter expressly disqualified dealers making sales under it from claiming benefits under the former notification.
The dispute concerned assessment year 2001-02. The assessing authority denied the partial exemption by an order dated 26 August 2003, relying on a departmental circular of 16 April 2001. The Deputy Commissioner (Appeals) allowed the dealer’s claim for transactions not assessed at the 6% rate, but the Rajasthan Tax Board reversed that decision. The High Court upheld the disallowance, interpreting the exclusion clause as applying to the dealer’s eligibility rather than merely to particular transactions.
The company contended that the two beneficial notifications could operate on distinct sales transactions, and relied on a 15 April 1994 circular permitting different treatment depending on whether Forms C or D supported the sales. It also invoked past administrative practice, consistency and the doctrine of contemporanea expositio. The Revenue maintained that the language of the 2000 notification prohibited simultaneous claims in a financial year.
