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PETITIONER: M/S. PINE CHEMICALS LTD. AND ORS. ETC. ETC.

       Vs.

RESPONDENT: THE ASSESSING AUTHORITY AND ORS. ETC. ETC.

DATE OF JUDGMENT16/01/1992

BENCH: RAMASWAMI, V. (J) II BENCH: RAMASWAMI, V. (J) II RANGNATHAN, S. OJHA, N.D. (J)

CITATION:  1992 SCR  (1) 179        1992 SCC  (2) 683  JT 1992 (1)   220        1992 SCALE  (1)46

ACT:     Interpretation    of    Statutes-Deeming     provision- Construction (Section 5, Jammu and Kashmir General Sales Tax Act, 1962).      Jammu  and Kashmir General Sales Tax Act,  1962-Section 5-Granting tax exemption-Procedure-Whether Government Orders 159   and  414  deemed  to  be  exemption   notification-Tax exemption-Kinds of-Person claims exemption-Duty of.      Jammu  and Kashmir General Sales Tax Act,  1962-Section 5-Tax exemption by Govt. Orders 159 and 414-"Will be granted exemption" and "will be exempted"-Meaning-Whether same.      Jammu  and Kashmir General Sales Tax Act,  1962-Section 5-Government Order 159 dated 26.3.1971, whether a follow  up action  of Government to its notification in SRO  214  dated 3.6.1971  issued under section 23 of the Jammu  and  Kashmir Urban Immovable Property Tax Act, 1962.      Claim of Period of exemption for 10 years on the ground of  promissory  estoppel-Reference to 10  years  in  Finance Minister’s  speech and the Brochure  dated  7.9.1978-Whether benefit  under  Govt.  Orders 159 and 414 continues  for  10 years.      Exemption-hether Govt. Orders 159 and 414 superseded by SRO  195 dated 31.3.1978-Taxability of Vanaspati and  edible oils under notification SRO 448 dated 22.10.1982.      Section  4(1)-Scheme of-Levy of single point  taxation- Tax exemption under Govt. Orders 159 and 414 whether  covers entire   series   of  sales  of  the   goods   manufactured- Applicability of notification SRO 448.      Central Sales Tax Act, 1956 :      Sections 6(1), 6(1-A), 15,8 (2-A)-Tax liability  under- Inter State sale-When takes place-Imposition of tax on  sale of declared goods by                                                        180 State under State Law in inter state sale-CST if paid, to be reimbursed-Over-riding  effect of section  8(2-A)-Scope  of- Applicability of Section 6(1-A).      Jammu and Kashmir General Sales Tax Act, 1962 :      Section 5-Govt. Orders 159 and 414-Benefits under-Facts to be proved by dealer-Intention of.      Govt.  Orders  159 and 414-Whether  superseded  by  SRO 80/82.      Jammu  and Kashmir General Sales Tax Act,  1962-Section 8B-Application of.

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    C.A. No. 2309/1989

HEADNOTE:      The    appellant-a    public    limited     company-was manufacturing  Rosin, Turpentine and Rosin  Derivatives  and was carrying on business at Bari Brahmana and Jammu Tawi.      On  20.1.1981,  the Assessing  Authority  assessed  the appellant-company  under the Central Sales Tax Act, for  the year ending 30.6.80.      On  22.2.1981 an assessment order under section 10  of the Act was made.  A penalty order was also made.      The  appellants challenged the order of  the  Assessing Authority before the High Court filing Writ Petition No.  87 of  1987, contending that they were exempt from  payment  of sales  tax  under the Central Sales Tax Act,  1956  and  the Jammu & Kashmir General Sales Tax Act, 1962, on the finished goods produced by them for a period of five years commencing from  8th November, 1979, in terms of the Government  Orders No. 159-Ind. dated 26.3.1971 as amended by Government  Order No. 414-Ind. dated 25th August, 1971 read with Section 8(2A) of   the  Central  Sales  Tax  Act;  that   the   Government represented and announced a package of incentives for  large and  medium scale industries grant of exemption  from  sales tax  both on the raw materials purchased by  the  industries and  the  sale  of their finished  products;  and  that  the Government was estopped from charging sales tax.      The High Court dismissed the Writ Petition holding that the  two  Government  Orders were only  declarations  of  an intention to exempt                                                        181 from  payment of sales tax and that they were not  exemption notifications  under section 5 of the General Sales Tax  Act and  that  the  appellants  failed  to  prove  the   factual foundation   for  invoking  the  principle   of   promissory estoppel.      Against the High Court’s decision by special leave C.A. No. 2309 of 1989 was filed by the appellant-company.      C.A. No. 2310  of 1989       The   appellant-company  had  filed  a   miscellaneous petition, after the judgement in the W.P.No. 87 of 1987 (the writ  petition of the High Court against which C.A.No.  2309 of 1989 was filed) for permission to file reply affidavit on the  ground  of that the documents produced at the  time  of hearing needed explanation.       The High Court dismissed the Misc. Petition as it  was belated and the judgement in the writ petition was delivered relying on the materials placed on record.        C.C.No. 3148-50 of 1989      The   appellant-partnership  firm   was   manufacturing Vanaspati  Ghee.   It  was  assessed  for  the  period  from 2.9.1981  till 30.9.1981 under the Jammu &  Kashmir  General Sales Tax Act.      The appellants moved the High Court in a writ  petition (W.P.No.  52  of  1982)  to  quash  the  assessment   order, contending   that  the  Government  order   159-Ind.   dated 26.3.1971  as  amended by Government  Order  414-Ind.  dated 25.8.1971  exempted  the sales of the  finished  product  of Vanaspati  Ghee from sales tax and that the  Government  was estopped from collecting tax.      When the Writ Petition (W.P.No. 52 of 1982) was pending an   assessment  order  was  made  on  14.11.1984  for   the assessment  year ending 30th September, 1982, including  the period  2nd  September to 30th September,  1981  (which  was

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questioned  in  W.P.No. 52 of 1982).  The  assessment  order dated 14.11.1984 was challenged by the  assessees-appellants in the writ Petition No. 822 of 1984.      During the pendency of the writ petitions certain other Government Orders were passed and certain assessment  orders for the subse-                                                        182 quent  periods were passed and those were questioned in  the Writ Petition No. 711 of 1987.      The  assessees contended that Government Order No. 159- Ind.  dated  26.3.1971 and Government Order  414-Ind.  dated 25.8.1971  were exemption orders referable to section  5  of the Jammu & Kashmir General Sales Tax Act.      The  respondents  contended that  the  said  Government orders  were not exemption orders section 5 of  the  General Sales Tax Act and that there was not factual foundation  for the plea of promissory estoppel.      The  High Court dismissed all the three writ  petitions by  a common order, against which Civil Appeals  3148-50  of 1989 were filed.      C.A.No. 3151 of 1989 :      The appellant-assessee filed a writ petition praying to quash certain notices issued under section 14 of the Central Sales Tax Act and for a declaration that the Vanaspati  Ghee manufactured  by  them was exempt from payment of  tax  upto January, 1992, i.e., for a period of 10 years from the  date from  which they started their commercial production as  per the Government Order 159-Ind. dated 26.3.1971 and Government Order  No.  414-Ind.  dated  25th  August  1971  as   orders exempting their goods from sales tax under Section 5 of  the Jammu & Kashmir General Sales Tax Act.      The  Writ  Petition was also  dismissed  against  which C.A.No. 3151 of 1989 was filed by special leave.      The assessee contended that the exemption from  payment of  tax  was  extended  from 5 years to  10  years  and  the Government  was bound to give the exemption for 10 years  on the  ground  of  promissory estoppel;  that  SRO  448  which superseded the exemption granted under the Govt. Orders  was ultra  vires  and  that  the  SRO  448  had  no  effect   of superseding  exemption granted under the G.O. 159  and  414; and  that  the  exemption  for 5  years  granted  under  the Government Orders could not be withdrawn on the ground  that SRO  80/82  was  prospective in operation and  also  on  the ground of promissory estoppel.      The  State  contended  that  even if  the  sale   of  a particular commod-                                                        183 ity  was exempted from payment of tax under the  local  Act, the dealer selling the same in inter-state trade or commerce would  be  liable  to  pay  Central  Sales  Tax  under   the provisions  of Section 6(1A) of the Central Sales  Tax  Act; that  if  Section  6(1A) of the Central Sales  Tax  Act  was applicable to a particular transaction of sale, Section 8(2- A)  of the General Sales Tax Act would not be applicable  to that  transaction;  that the conditions  that  the  industry should  have been set up and commissioned subsequent to  the Government  Orders  159 and 414 and the  commodity  sold  in order  to claim the exemption under the  Government  Orders, should  be  those  manufactured by that  industry  were  the conditions or specified circumstances within the meaning  of the  Explanation and, therefore, the appellants in  C.A.Nos. 2309,  2310/89  were  not entitled to  any  exemption  under Section  8(2-A)  of  the Central Sales  Tax  Act;  that  the Government   Orders  were  superseded  by  SRO   80/82   and Vanaspati  Ghee was made liable to tax at the rate of 8  per

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cent;  that  the  goods manufactured by  the  appellants  in C.A.Nos.  2309,  2310/89 were also made taxable  as  falling under the residuary item at the rate of 8 per cent; that  in the assessment order relating to Assessment Year 1981-82 for the  period  from  1.9.1981  to 30.8.1982  in  the  case  of appellants  in  C.A.  Nos. 3148-3150 of  1989  there  was  a finding that the assesses collected sales tax in respect  of their sales turnover for which the exemption was now claimed and that under Section 8-B of the J&K General Sales Tax  Act the said amount was refundable to the Government.      As  the questions, arose in these appeals were  common, appeals were heard together and allowing the appeals of  the assessees by a common judgment, this court,      HELD :1. If power to do an act or act or pass an  order can be traced to an enabling statutory provision, then often if that provisions is not specifically referred to, the  act or order shall be deemed to have been done or made under the enabling provision. [194D]      2.1  Normally in the case of grant of tax exemption  as an incentive to industry the exemption orders have generally taken   the   form  of  Government  Order  rather   than   a notification.   But in the case of other  exemptions  though they are also under section 5 of the local Act (J&K  General Sales   Tax  Act,  1962)  they  have  taken  the   form   of notification. [194G-H]      2.2 The pattern followed in Jammu & Kashmir is that  in respect                                                        184 of  exemptions  from  payment  of  taxes  following  Cabinet decision on Policy matters and incentive they have taken the form of a Government order. [194H-195A]      2.3  The  Jammu & Kashmir General Sales Tax  Act,  1962 itself  makes a distinction requiring a notification  to  be made  for  certain purposes and the making of  a  Government order in respect of certain other purposes.  Since there  is no  form prescribed in this behalf, if the particular  order in  effect is an exemption order, whether it takes the  form of an order or notification makes no difference. [194F-G]      2.4  From the publicity given to the Government  Orders 159 and 414 by the Government, while inviting  entrepreneurs to establish industries in Jammu & Kashmir and certain other communications to the parties, it is be understood that  the Government  orders  159 and 414 were  treated  as  exemption orders  satisfy  all the requirements of the  provisions  of section 5 of the local Act. [195B-C, 194E]      2.5  Even as an order of exemption the  appellant  will have  to show that he had set up the industry in  conformity with the intent of 1971 order and entitled in terms  thereof to  the  exemption in respect of the goods  manufactured  by him.   But  that is not to say that  after   he  establishes those  facts  the Government will have to  make  a  separate order of exemption in relation to him. [201C-D]      2.6 There is no prescribed form for granting  exemption under  section  5 of the Jammu & Kashmir General  Sales  Tax Act.  There is also no prohibition against reference to  any other matter or matters in exemption orders under section  5 of  the  General Sales Tax Act.  If the  incentives  related also  to  other benefits or rights merely because  they  are included  in the same Government Order does not make it  any the less an exemption order so far as the exemption  related to payment of sales tax. [202C-D]      2.7  The High Court was in error in thinking  that  the exemption  order  should  be  specific  in  favour  of   the appellant.  The exemption as can be seen from the provisions of  section 5 of the Jammu & Kashmir General Sales  Tax  Act

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could be in respect of any class of dealers or any goods  or class or description of goods.  There could be an  exemption to  an  individual also but the power of  exemption  is  not restricted   to   such  cases  alone.   It  may   refer   to transactions of sale of a particular type of goods or  class or  description  of  goods or in respect  of  any  class  of                                                        185 dealers or a combination of both. [201B]      3.1 ‘Will be granted exemption’ has the same meaning as ‘will  be  exempted’ and does not in any way  show  that  it requires a further follow up action. [201G-H]      3.2  The  exemption is with reference  to  an  industry which  is  to be established subsequent  to  the  Government order.   Therefore in that sense both expressions  mean  the same. [202A]      4.  The notification issued on the 3rd of June 1971  in SRO  214  under  section 23 of the  Jammu  &  Kashmir  Urban Immovable  Property  Tax Act, 1962, amending  the  Immovable Property  Tax  Rules,  1962  by  inserting  Rules  20-A  was subsequent to GO 159 Ind. dated 26.3.1971.  It was published on  25.3.1971 in the Government Gazette under section  23(1) for information of all persons likely to be affected thereby and any objection or suggestion which may be received in the Finance Department from any person with respect to the  said draft  before  the  said  date will  be  considered  by  the Government.   It  is by reason of the fact that  this  draft rule  has  been published calling for objection the  GO  159 Ind. itself stated that the grant of immovable property  tax exemption would be available "as admissible under the  Urban Immovable  Property Taxation Rules".  Thus on the  day  when the  Government Order was made there was already  the  draft amendment rules, and, therefore, it could not be stated that the  amendment  was a follow up action in pursuance  of  the Government order.  The Government order refers to the  draft and  says as per the amendment they will be entitled to  the exemption. [202E-203B]      5.1  The only reference to 10 years was in the  Finance Minister’s speech and in the Brochure dated September  1978. The  Brochure  only  lists  the  concession  and  incentives available  generally.  It does not refer to  any  Government decision or Cabinet decision or any order of the Government. [203G-H]      5.2 The Finance Minister’s statement made in March 1978 only refers to a proposal to continue the grant of exemption from  payment of sales tax for a period of 10  years.   This statement  also  is not unambiguous.  It may mean  that  the benefits  under  the Government Orders 159 and  414  may  be continued for another 10 years without withdrawing the same. This is merely a budget proposal which could                                                        186 give  rise  to no right to the appellants.  As  no  decision order  or notifications is produced extending the period  of exemption  in  relation to sales tax it is not  possible  to consider  the claim of the appellants for exemption  for  10 years on the ground of promissory estoppel. [204 B-C]      6.1  The SRO No. 195 dated 31.3.1978 did not and  could not  supersede  the exemption granted under  the  Government orders 159, 414. [205D]      6.2 When it stated in the amending notification SRO 448 dated 22nd October, 1982 that vanaspati and edible oils  are taxable  at the point specified therein it only  means  that those  vanaspati and edible oils which are not exempted  are taxable  at  the  points specified  in  the  Schedule.   The Government order gave exemption only for five years from the date  of commencement of the industry and  those  industries

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who  had  been manufacturing for more than that  period  and also  those industries who were not entitled to the  benefit of  the said Government order would be liable to  pay  sales tax on the vanaspati manufactured by them and the said goods were  liable to tax at the point specified in the  Schedule. [205F-G]      7.1 In the scheme of levy of single point taxation, the Government  could fix any point in the series of  sales  for the  Government have fixed the sale by the dealer,  that  if the  second sale, as the taxable point no exception  can  be taken.  In that sense no question of vires on the ground  of lack of power would arise. [205H-206A]      7.2 Under section 4(1) of Jammu & Kashmir General Sales Tax Act the goods are taxable only once, that is it could be taxed only at one point of sale.  The government orders  159 and  414  are  exemption  orders  and  exempt  the  sale  by appellants  of their manufactured products.   The  exemption would not arise unless the goods are taxable at the point of their sale.  Thus the effect of exempting their sale is that the  said goods manufactured by them could not be  taxed  at the  second  or subsequent sales also as that  would  offend section 4(1) which provides for single point levy.  In cases where there are no exemption orders and the State fixed  the second or subsequnt  sale as point of taxation the first  or prior or subsequent sales are not exempted sales but are not taxable  sales.   Therefore  SRO  448  fixing  he  sale   of vanaspati  ghee  by  a dealer would  not  be  applicable  to vanaspati  ghee  manufactured by the  appellants  which  are exempt under the Government orders. [206B-D]                                                        187      7.3 The goods manufactured by the Appellants are exempt under  Government  Orders  159 and 414  and  that  exemption covers entire series of sales of that very goods. [206D]      8.1  Under section 6(1) of the Central Sales  Tax  Act, 1956  every dealer who sells goods in the course  or  inter- state  trade  or commerce shall be liable to pay  tax  under that Act.  A sale of goods shall be deemed to take place  in the  course  of inter-state trade or commerce  if  the  sale occasions the movement of goods from one state to another or if effected by a transfer of documents of title to the goods during their movement from one State to another. [207D-E]      8.2  In view of the provisions of Section 15 the  State Law can impose tax on sale of declared goods only at a  rate not  exceeding four per cent of the sale price and such  tax also shall not be levied at more than one stage.  If the tax has  been levied under the State Law on declared  goods  and such  goods are sold in the course of inter-state trade  and tax has been paid under the Central Sales Tax the Law levied under the State law shall be reimbursed to the person making such sale in the course of inter-state trade. [208C-E]      8.3  Section 8(2-A) of the Central Sales Tax  Act  does not  have any over-riding effect on the scheme  of  taxation relating  to inter-State sale of declared goods.   There  is also  scope for the applicability of section 6(1-A)  of  the Central Sales Tax Act when the inter-state sale takes  place when the goods are in transit and is effected by transfer of documents  of title to the goods during their movement  from one State to another. [209B-C]      8.4 Only certain cases which would have been covered by section 6(1-A) of the Central Sales Tax Act have been carved out   for   the  purpose  of  exemption   subject   to   the applicability  of  section 8(2-A) of the Central  Sales  Tax Act.   Section 6(1-A) of the Central Sales Tax Act  has  not become otiose by reason of inclusion of that section in  the non-obstante  clause  in section 8(2-A).   Both  provisions,

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therefore,  operate  and they should not be read  so  as  to nullify the effect of one another. [209C-E]      9.  The facts which the dealer had to prove to get  the benefit  of  the  Government orders  are  intended  only  to identify  the dealer and the goods in respect of  which  the exemption   is  sought  and  they  are  not  conditions   or specifications  of  circumstances relating to  the  turnover sought                                                        188 to  be  exempted from payment of tax within the  meaning  of those  provisions.   The  specified  circumstances  and  the specified  conditions referred to in the explanation  should relate  to the transaction of sale of the commodity and  not identification of the dealer or the commodity in respect  of which the exemption is claimed.  The conditions relating  to identity  of  the goods and the dealer are always  there  in every  exemption  and that cannot be put as a  condition  of sale. [210D-F]      10.1.  SRO  80/82 was prospective  in  operation.   The Government seems to have been following as a pattern that is in the case of incentives to industries the exemption orders had taken the form of a Government order.  Government orders 159  and 414 were also in pursuance of a  Cabinet  decision. SRO  80/82  though  a  Government  notification  under   the Business  Rules it is issued by the Ministry concerned.   In the circumstances there is also a serious doubt whether  the said incentives could have been superseded by the SRO 80/82. [213H-214B]      10.2.  In  the  case of a grant  of  exemption  without specifying  any period for which the exemption is  available the  Government  could withdraw the same at any  time.   The appellants  acting on the representations of the  Government had set up their industries.  Therefore they are entitled to claim the benefit of the exemption for the entire period  of five  years  calculated as per the terms of  the  Government orders, even if it were to be held that SRO 80/82 superseded the earlier exemption orders. [216D-E, 216G-217A]      11. Since the assessment orders were regular assessment orders on the ground that their sales are taxable sales  the question  of  applicability of Section 8B of the  local  Act does not arise.  That question arises in view of the finding that their sales turnover are exempt but still under section 8B  of  the Local Act, they are liable to refund  any  money collected "by way of tax". [217G-H]      Pournami  Oil Mills & Ors. v. State of Kerala  &  Anr., [1986]  Supp. SCC 728; Bakul Oil Industries & Anr. v.  State of  Gujrat & Anr., [1987] 1 SCR 185; Assistant  Commissioner of  Commercial Taxes (Asstt), Dharwar & Ors.  v.  Dharmendra Trading Company and Ors., [1988] 3 SCC 570; Indian Aluminium Cables  Ltd.  &  Anr.  v. State  of  Haryana,  38  STC  108; Industrial Cables India Ltd. v. Assessing Authority,  [1986] Supp. SCC 695; International Cotton Corporation (P) Ltd.  v. Commercial Tax Officer & Ors., 35 STC 1; referred to.                                                        189

JUDGMENT:      CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 2309  & 2310 of 1989 etc etc.      From  the  Judgment and Order dated  23.9.1988  of  the Jammu  & Kashmir High Court in Writ Petition No.  87/81  and C.M.P. No. 2519 of 1988.      K. Parasaran, D.D. Thakur, M.H. Beg, Raja Ram  Agrawal, M.L.  Verma,  Prashant  K. Goswami, Anil  B.  Divan,  Pramod

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Kohli,   P.H.  Parekh,  Hari  Khanna,  J.P.Pathak,   Sandeep Thakral, S.M.Thakral, B.V. Desai, Ms. Vinita Ghorpade,  E.C. Aggarwala, N.N. Bhatt, Dhiraj Singh and Ashok Mathur for the appearing parties.      The Judgment of the Court was delivered by      V.  RAMASWAMI, J. Civil Appeal No. 2309 of 1989  arises out of an order made by the High Court of Jammu & kashmir in Writ  Petition  No.87 of 1981 dismissing the  Writ  Petition filed by M/s. Pine Chemicals Ltd., which is a public limited company   manufacturing   Rosin,   Turpentine   and    Rosin Derivatives and carrying on business at Bari Brahmana, Jammu Tawi.   The appellants had prayed in the writ  petition  for quashing  the order of assessment dated 20th  January,  1981 made by the Assessing Authority, Incharge Sales Tax  Circle, Jammu  under  the Central Sales Tax Act, 1956 for  the  year ending  30.6.1980 and the penalty order made on February  2, 1981  under  Section  10 of the Central  Sales  Tax  Act  in respect  of  the  same period. They had also  prayed  for  a declaration that they are entitled to exemption from payment of  tax  under  the Central Sales Tax Act and  the  Jammu  & Kashmir  General Sales Tax Act, 1962, on the finished  goods produced by them for a period of five years commencing  from 8th  November, 1979, when the Company went  into  commercial production.   This  main relief had been prayed for  on  the grounds that the appellant were exempt from payment of sales tax  in terms of the Government Orders No. 159 - Ind.  dated 25.3.1971 as amended by Government Order No. 414-Ind.  dated 25th  August,  1971 read with section 8(2A) of  the  Central Sales  Tax Act.  Their further case was that the  Government represented  and announced a package of incentive for  large and  medium  scale industries including grant  of  exemption from  sales tax both on the raw materials purchased  by  the industries  and the scale of their finished  products,  that acting  upon such representation and assurances,  appellants set  up their factory at Bari Brahmana on the land  allotted by  the  State Industrial Development Corporation  and  that therefore the Government is estopped from charging sales tax on the doctrine of promissory estoppel.  The High Court  was of the view that                                                        190 the  two  Government  orders referred  to  above  were  only declarations of an intention to exempt from payment of sales tax  and  that they are not  exemption  notifications  under sections 5 of the General Sales Tax Act.  The High Court was also of the view that the appellant have failed to prove the necessary  factual foundation for invoking the principle  of promissory  estoppel  and  that,  therefore,  they  are  not entitled  to any relief under that doctrine.  In  that  view the writ Petition was dismissed.      It may be mentioned that Civil Appeal No. 2310 of  1985 is against an order made in a Civil Misc.  Petition No. 2519 of 1988 which was also dismissed on 23.9.1988 along with the writ petition.  This miscellaneous petition was filed  after the   judgment  in  the  writ  petition  was  reserved   for permission  to file reply affidavit on the ground  that  the assessment  files produced at the time of hearing  contained certain   documents  needing  certain  explanation  by   the appellants.   Both on the ground that it was belated and  on the  ground  that  the judgment in  the  writ  petition  was delivered only relying on the material placed on record  and therefore there was no need for giving an opportunity to the writ  petitioners  to file a reply  statement,  the  learned judgment dismissed this miscellaneous petition also.      Civil  appeals 3140-50 of 1989 have been filed by  M/s. K.C.   Vanaspati,  a  firm  of   partnership   manufacturing

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Vanaspati  Ghee  at Bari Brahmana, Jammu Tawi.   They  filed writ  petition  52  of 1982 praying to  quash  a  sales  tax assessment order dated 16.1.1982 assessing them to sales tax for the period from 2nd September, 1981 till the end of  the month under the Jammu & Kashmir General Sales Tax Act.  They also prayed for a mandamus directing the Government and  the Assessing officer not to assess them to sales tax or recover any amount on account of sales tax from them for a period of five  years  from 2nd September, 1981  when  their  industry started commercial production.  This relief was prayed again on the ground that Government Order 159-Ind. dated 26.3.1971 as  amended  by Government Order  414-Ind.  dated  25.8.1971 exempted  the sales of their finished product  of  Vanaspati Ghee from sales tax and also on the ground that in any  case the  Government  is  estopped from  collecting  tax  on  the principle  of promissory estoppel.  When this writ  petition was  pending as assessment order was made on 14.11.1984  for the assessment year ending 30th September 1982 including the period  2nd September to 30th September, 1981 which was  the subject matter of the earlier assessment order and which was questioned in writ petition No. 52 of 1982.  The validity of this  assessment  order  was  the  subject  matter  of  writ petition  No.  822  of 1984 filed by  the  appellants.   The relief prayed for and the grounds on which the relief prayed for were almost identical as that in writ petition No. 52 of 1982 except that                                                        191 on the question of promissory estoppel, more detailed  facts were mentioned in this writ petition.  The respondents filed their counter affidavits contending that the said Government orders  were  not exemption orders under Section  5  of  the General  Sales  Tax  Act  and  that  there  is  no   factual foundation  for the plea of promissory estoppel.   Since  we will   be  dealing  with  contentions  in  detail   at   the appropriate place we are not setting out contentions of  the petitioners  and the replies of the Government in  the  writ petitions  in  details.   During the pendency  of  the  writ petitions certain other Government orders came to be  passed and  certain  assessment orders for the  subsequent  periods were  also sought to be made and questioning  these  actions M/s. K.C. Vanaspati filed Writ petition No. 711 of 1987  for a writ of prohibition restraining the Assessment Officer and Government  from  recovering any sales tax at any  point  of sale  in  the series of sales in respect of  Vanaspati  Ghee manufactured  by  them  for a period of 10  years  from  2nd September,  1981  when their factory  went  into  commercial production  and  also for a declaration that SRO  448  dated 22nd  October,  1982  issued by the Government  of  Jammu  & Kashmir  (which will be referred to later) was  illegal  and unconstitutional.   They  had  also prayed  for  a  mandamus directing  the respondents to refund the sales  tax  already recovered from them with interest and damages.  In this writ petition also they contended that Government Order No.  159- Ind.  dated  26.3.1971 and Government Order  414-Ind.  dated 25.8.1971  were exemption orders referable to section  5  of the  General  Sales  Tax  Act.   They  have  also   referred elaborately   to  the  representations,   declarations   and promises  of  the  Government  in support  of  the  plea  of promissory  estoppel.  The respondents had filed  a  counter affidavit refuting these contentions of the appellants.  The High  Court  dismissed all these three writ petitions  by  a common order dated 22nd February, 1989.  Civil Appeals 3148- 50 of 1989 have been filed against this common order.      Civil  Appeal No. 3151 of 1989 has been filed  by  M/s. Kashmir  Vanaspati  Ltd. against the judgement of  the  High

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Court in Writ Petition No.5 of 1989 in which they had prayed for  the writ of certiorari to quash certain notices  issued to the appellants, their selling agents and the owner of the premises  where  they have their sale depots,  issued  under section  17  of  the  General  Sales  Tax  Act  and  for   a declaration  that  the Vanaspati Ghee  manufactured  by  the appellants is exempt from payment of tax at all stages  upto January,  1992 i.e. for a period of 10 years from  the  date from  which they have started their  commercial  production. In  this  writ petition also the appellants  had  relied  on Government  Order  159-Ind. dated 26.3.1971  and  Government Order  No.  414-Ind.  dated  25th  August,  1971  as  orders exempting their goods from sales tax under Section 5 of  the General  Sales  Tax Act.  They have also relied  on  certain statement of Government as commitments                                                        192 to continue the incentives and exemptions from sales tax for a  period  of  10  years  on  the  principle  of  promissory estoppel.    The   respondents  had  filed   their   counter affidavit.   This writ petition was also dismissed  on  17th March,  1989  almost on the same grounds as in  earlier  two cases.      The first common question that arises for consideration in  all these appeals therefore is whether Government  Order No.  159-Ind.  dated 26.3.1971 and the  amending  Government Order  No. 414-Ind. dated 25.8.1971 are orders of  exemption referable  to section 5 of the General Sales Tax Act,  1962. The said Government Orders are extracted below :          GOVERNMENT  OF  JAMMU AND  KASHMIR  INDUSTRIES  AND          COMMERCE DEPARTMENT      Sub:  Grant  of incentives to large and  Medium  Scale            industries in the Jammu & Kashmir State      Ref:   Cabinet Decision No. 101 dated 26.3.1971             Government  Order  no. 149-Ind.  of  1971  dated             26.3.1971             Sanction  is  accorded  to  the  grant  of   the             following incentives and facilities to Large and             Medium Scale Industries in the State of Jammu  &             Kashmir :         1.  Land:  As provided in Government Order No.  206-             Ind.  of  1968 dated  5.7.1968.   However,  such             land......include  a reasonable amount  of  land             for  the establishment of  residential  colonies             required  to  house  the workers  of  Large  and             medium  scale Industries and would be granted on             the   terms  and  conditions  defined   in   the             Government  Order  No. 206-Ind.  of  1968  dated             5.7.1968.         2.  Grant of exemption from the State Sales Tax both             on  raw materials and finished products for  the             period of five years from the date the unit goes             into production.         3.  Grant  of  exemption  from  levy  of  additional             surcharge  on Toll Tax for an initial period  of             five  years  from the date the  unit  goes  into             commercial   production  with  respect  to   raw             materials  and finished goods.  The question  of             grant  of exemption from this levy  for  further             periods would be reviewed thereafter in every                                                        193             individual  case  and  further  grant  of   this             concession would only be considered in deserving             individual cases.         4.  Grant  of  exemption  from  the  levy  of  Urban             Immovable   Property  Tax  on  the   lands   and

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           buildings belonging to such industries would  be             available   as  admissible   under   the   Urban             Immovable Property Taxation Rules.             By order of the Government of Jammu and Kashmir.                                               Sd/-G.R.Renzu,                                     Secretary to Government"      This  order  was partially modified in  G.O.  414  Ind. dated 25.8.1971 which read as follows:          "  GOVERNMENT OF JAMMU AND KASHMIR  INDUSTRIES  AND          COMMERCE DEPARTMENT       Sub:  Grant  of  incentives to the  Large  and  Medium             Scale Industries in the Jammu & Kashmir State       Ref:  Director  Industries and Commerce’s  letter  No.             SSI-J/455/2251-52 dated 22-7-1971             Government  Order  No. 414-Ind.  of  1971  dated             25.8.1971             In partial modification of Government Order  No.             159-Ind. of 1971 dated 26.3.1971, item 2 may  be             read as under:         2.  Grant  of exemption from the sales tax  both  on             raw materials and finished products.             The  State  Sale Tax paid by  Large  and  Medium             Scale  Industries on the raw materials  procured             by   them  for  the  initial  5  years  of   the             production would be refunded to such industries.             Similarly   such  industries  will  be   granted             exemption  from the payment of any  state  sales             tax  on their finished products for a period  of             five  years  from the date the  unit  goes  into             production.                                                        194             By order of the Government of Jammu and Kashmir.                                                        Sd/-                                    Secretary to Government". It may be noted at this stage itself that the amending Order G.O. 414-Ind. dated 25th August, 1971 was also published  in the Government Gazette.      Section  5 of the General Sales Tax Act, 1962  empowers the  State Government to grant exemption from  taxation  and that section reads as follows:          "Exemption   from  taxation:  The  Government   may          subject to such restrictions and conditions as  may          be  prescribed, including conditions as to  licence          and  licence fees, by order exempt in whole  or  in          part  from payment of tax any class of  dealers  or          any goods or class or description of goods."      The  Government  orders  were  made  implementing   the Cabinet  decision  No. 101 of the same date.   There  is  no ambiguity about the class of persons or dealers to whom  the Government  orders  apply, no ambiguity about the  class  or description of goods and the transactions of sale which  are exempt from tax.  It has been duly authenticated in terms of Section 45 of the Constitution of Jammu and Kashmir.  It  is well settled that if power to do an act or pass an order can be  traced to an enabling statutory provision, then even  if that  provision is not specifically referred to, the act  or order  shall be deemed to have been done or made  under  the enabling provision.  Thus the Government orders satisfy  all the  requirements  of the provisions of Section 5  of  local Act.  The section also does not talk of any notification: it only  talks of a Government order exempting in whole  or  in part  from payment of tax.  This is very  insignificant,  if contrasted  with  Section  4(1) and 4(5) of  the  local  Act relating  to the fixation of the taxable point refers  to  a notification by the Government.  The Act itself thus makes a

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distinction requiring a notification to be made for  certain purposes and the making of a Government order in respect  of certain  other purposes.  Moreover, since there is  no  form prescribed in this behalf if the particular order in  effect is an exemption order, whether it takes the form of an order or  notification makes no difference.  But we may note  from the  various orders produced before us that normally in  the case of grant of tax exemptions as an incentive to  industry the  exemption  orders  have generally  taken  the  form  of Government order rather than a notification.  But in the                                                        195 case of other exemptions though they are also under  section 5 of the local Act they have taken the form of notification. Thus  the  pattern followed in Jammu & Kashmir seems  to  be that  in  respect  of  exemptions  from  payment  of   taxes following  Cabinet decision on policy matters and  incentive they  have  taken  the  form of  Government  order.   It  is necessary   to   refer   this  aspect   because   in   later modifications   while  superseding  the  earlier  order   or notifications,  the  Government have followed  the  specific pattern and have used the word ‘orders’ in cases of grant of incentive and the word ‘notifications’ in the other cases.      It  may also be pointed out that the Government  orders 159  and  414  were  also understood  and  treated  as  such exemption  orders as seen from the publicity given  them  by the  Government  while inviting entrepreneurs  to  establish industries   in   Jammu   &  Kashmir   and   certain   other communications to the parties.  The booklet published by the Government  in December, 1975 under the heading  "Incentives to  Development of Industries in Jammu & Kashmir"  contained incentives  available  for small scale  industries  as  also large  and  medium  scale industries.  The  above  said  two Government  Orders  were reproduced in this booklet  as  the orders relating to incentives available to large and  medium scale  industries.  Another brochure issued in  March,  1978 under  the  heading ‘The State  Marches  Towards  Industrial Development’ after noting the efforts made by the Government to  invite industrial enterprises from outside the State  to locate the industries in Jammu & Kashmir and the response by the  industrialist, listed the package of  incentives  under the heading ‘Incentives Available to help you establish your beautiful industrial ventures in the J & K State’. Item 5 of this  list related to ‘exemption from certain taxes’.   This was followed by the Finance Minister’s Budget Speech for the year 1978-79 in which the Finance Minister stated:          "We have to continue a consistent policy of support          and protection to industry and attract as many  new          units  as  we can, both in order  to  increase  the          employment   opportunity  and  to  achieve   better          economic  growth.   It  is  as  such  proposed   to          continue  the  grant of exemption from  payment  of          sales  tax on the goods manufactured by  new  units          for  a period of ten years from the date  the  unit          goes into production."      Subsequent  to  this  speech of  the  Finance  Minister another Brochure was published by the Government on the  7th September, 1978 which referred to the sustained efforts made by  the  Government to involve  successful  and  experienced entrepreneurs from all over the country in                                                        196 setting up the industries in J & K and incentives  available to  the industries.  In page 14 of this Brochure  "Exemption from Sales Tax and toll tax for 10 years and exemption  from CST"  is  listed as one of the incentives available  in  the State.   Obviously   these  announcements,  references   and

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statements  relating  to exemption from sales tax  refer  to G.O.  159-Ind.  dated  26.3.1971  and  G.O.  414-Ind.  dated 25.8.1971.   No  other  Government  order  of   notification relating to exemption from payment of sales tax by large and medium  industries were bought to our notice as relating  to these references in the Brochures and speeches.      Thus  on a plain reading there could be no  doubt  that the two Government orders are referable to the power of  the Government under Section 5 of the General Sales Tax Act  and are  exemption  orders  falling within  the  scope  of  that provision.      In  this  connection,  we  may  also  refer  to   three decisions  of  this Court cited at the Bar  wherein  similar orders of Government without specifying the source of  power under  which  they were made and also not in the form  of  a notification,   were  considered   to  be  orders   granting exemption.      In Pournami Oil Mills & Ors. v. State of Kerala & Anr., [1986],  Supp. SCC 728, this Court had occasion to  consider almost identical Government orders as those we are concerned with  in  these appeals.  The first was a  Government  Order dated 11th April, 1979 and the relevant portion of the  same reads as follows:          "The Government has considered the  recommendations          and suggestions of the Committee in detail and they          are  pleased  to approve the following  package  of          measures  for promoting industrial  development  in          Kerala:          SMALL SCALE INDUSTRIES:          Sales Tax Concessions:          New  industrial units under small scale  industries          set up after April, 1979, will be exempted from the          payment  of  sales tax for a period of  five  years          from the date of production...      The second was a notification dated 21st October,  1980 made  under Section 10 of the Kerala General Sales  Tax  Act which read as follows:          "In  exercise of the power conferred by Section  10          of the Kerala                                                        197          General  Sales Tax (15 of 1963) the  Government  of          Kerala  have considered it necessary in the  public          interest  so  to do, hereby make  an  exemption  in          respect  of the tax payable under the said  Act  on          the turnover of the sale of goods produced and sold          by  the  new  industrial  units  under  the   small          industries for a period of five years from the date          of  commencement of sale of such goods by any  such          units  by way of tax on their sales shall  be  paid          over to Government and that the sales tax, if  any,          already paid by such units to Government shall  not          be refunded.          Provided that such units shall produce  proceedings          of the General Manager, District Industries Centre,          declaring the eligibility of the units for claiming          exemption from sales tax.          Provided  further  that the  cumulative  sales  tax          concessions granted to a unit at any point of  time          within this period shall not exceed 90 per cent  of          the  cumulative gross fixed capital  investment  of          the unit.           Explanation-For  the purpose of this  notification          new   industrial   unit  under  the   Small   scale          Industries  shall  mean undertakings set up  on  or          after  April  1,  1979  and  registered  with   the

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        Department  of Industries and Commerce as  a  small          scale industrial  unit.          This notification shall be deemed to have come into          force with effect from April 1, 1979."      Section  10  of  the  Kerala  General  Sales  Tax   Act empowered  the Government if they consider it  necessary  in the public interest, by notification in the Gazette, to make an  exemption or reduction in rate either  prospectively  or retrospectively in respect of any tax payable under the Act. It  may be seen that the first Government Order  dated  11th April, 1979 did not refer to any statutory power under which that order was made and it was generally in the nature of an order  approving  package  of measures  and  incentives  for promoting  industrial development in Kerala and not  in  the form  of a notification, while the second  notification  was made specifically in exercise of the statutory powers  under section 10 of the Kerala Act.  It may also be seen that  the first  Government  Order gave more tax exemption  while  the second  notification did not give any exemption relating  to purchase tax and also confined the exemption from sales  tax to the limits specified in the proviso to the  notification. Two main questions were                                                        198 considered  by this Court.  The first was whether the  first Government  Order  dated 11th April, 1979 was  an  exemption order  referable  to  the powers  of  the  Government  under section 10 of the Kerala Act.  On this issue this Court held that  it was an exemption order and that since there was  an enabling provision in the statute empowering the  Government to give exemption, though the Government Order did not refer to the statutory provision conferring such powers the  order should  be deemed to have been made under the said  enabling provision  and that therefore both the orders were  made  in exercise  of the powers under section 10 of the Kerala  Act. The  second  important point that was decided was  that  the second  notification was prospective in operation  and  that industries set up on or after Ist April, 1979 and before the 21st  October, 1980 would be entitled to the benefit of  the whole  exemption  under the first Government order  for  the full  period  of  five  years from  the  date  they  started production  and that right could not have been curtailed  by the  second notification dated 21st October, 1980.   As  the Govt. was bound by the rule of estoppel from taking away the right  which had accrued to them under the first  Government order.  Only new industries set up after the  21st  October, 1980  would have the restricted benefit as provided  in  the second notification.      In  Bakul Oil Industries & Anr. v. State of  Gujarat  & Anr.,  [1987]  1  SCR,  185, the  effect  of  two  exemption notifications  made  in exercise of the  Government’s  power under  section 49(2) of the Gujarat Sales Tax Act, 1960  was considered.   Under the first notification  dated  29.4.1970 certain exemption from payment of sales tax or purchase  tax was  given in respect of certain specified classes of  sales and purchases described in the Schedule to that notification without   any   specification   of   period.    The   second notification dated 11.11.1970 amended the first notification by   adding  a  new  entry  in  the  Schedule  exempting   a manufacturer  who established a new industry from the  whole of purchase tax and sale tax for a period of five years from the  date  of commissioning of the industry .   This  second notification  stated  that for the benefit of  claiming  the exemption  the industry shall have been commissioned at  any time  during the period from Ist April, 1970 to 31st  March, 1975.  The assessee in that case had commissioned his  plant

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on the 17th May, 1970 and when the Industries  Commissioners refused to give him the eligibility certificate for claiming exemption he filed a writ petition under Article 226  before the  Gujarat  High Court.  During the pendency of  the  writ petition  the State Government issued  another  notification dated  17th  July,  1971 amending  the  definition  of  ‘new industry’   and   excluding  among   others   decorticating, expelling,  crushing,  roasting, parching,  frying  of  oil, seeds  and colouring, decolouring and scenting of oil,  from the purview of the exemption notification.  This Court                                                        199 held  that under the first notification dated  9.4.1990  the exemption  granted was general and did not stipulate  as  to how  long the exemption would remain in operation  and  that would mean that the exemption granted under the notification was  to have operative force till such time  that  exemption was allowed to remain before being withdrawn by a subsequent notification.    Though   the  second   notification   dated 11.11.1970  gave exemption for a period of five  years  from the date of commissioning of the industry this Court was  of the  view  that,  that exemption cannot be  invoked  by  the assessee  in  that  case for claiming  the  benefit  of  tax exemption for five years because the second notification was prospective  in operation and would apply only to those  new industries  which were commissioned subsequent to the  issue of  that  notification and since the assessee in  that  case commissioned  the  Mill  on  17.5.1970  before  the   second notification  he was not eligible for the benefit of  second notification.    However,  the  learned  counsel   for   the respondents relied on the observation in the first paragraph at page 192 of the Bakul Oil Industries case (supra) wherein the  learned Judges have held that the State Government  was under  no  obligation in any manner known to  law  to  grant exemption and that it was fully within its powers to  revoke the exemption by means of a subsequent notification.   These observations will have to be understood in the light of  the earlier   statement  that  the  second  notification   dated 11.11.1970  was prospective; that is to say if the  industry had been commissioned subsequent to 11.11.1970 the  assessee would  have  been  entitled to the exemption  for  the  full period of  five years.  These observations are apposite only to  the notification dated 9.4.1970 which was the one  which the  assessee was entitled to.  In  correctly  understanding the ratio of this judgment we have to keep in mind that  the date  of  commissioning  of the industry  was  the  relevant factor to the entitlement of the relief.  Therefore this  is an authority only for the proposition that if the  exemption notification did not stipulate as to how long the  exemption would remain in operation it would be open to the Government to   withdraw  the  same  at  any  time  by   a   subsequent notification.  But the learned Judges did not stop with that but  make  a  further  observation  that  if  the  exemption notification  gave  exemption  from payment  of  tax  for  a particular period and an industry was commissioned after the date  of  the exemption order but before the  exemption  was withdrawn,  the  said  industry would  be  entitled  to  the benefit  of  exemption  for  the  period  specified  in  the exemption  order though the exemption was  withdrawn  before the expiry of that period if the industry could rely on  any estoppel.   This  is  also  clear  as  the  learned   Judges themselves  have  observed that  the  industry  commissioned subsequent to the notification could also plead estoppel and observed:          "We  must,  however,  observe  that  the  power  of          revocation or

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                                                      200          withdrawal would be subject to one limitation  viz.          the  power cannot be exercised in violation of  the          rule  of Promissory Estoppel.  In other words,  the          Government can withdraw an exemption granted by  it          earlier  if such withdrawal could be  done  without          offending  the  rule  of  Primissory  Estoppel  and          depriving  an industry entitled to claim  exemption          from  payment of tax under the said rule.   If  the          Government  grants exemption to a new industry  and          if  on the basis of the representation made by  the          Government  an industry is established in order  to          avail the benefit of exemption, it may then  follow          that  the  new industry can  legitimately  raise  a          grievance that the exemption could not be withdrawn          except by means of legislation having regard to the          fact  that  Primissory Estoppel cannot  be  claimed          against a statute."      The Government Order which was considered by this Court in  Assistant  Commissioner of  Commercial  Taxes  (Asstt.). Dharwar  &  Ors.  v. Dharmendra Trading  Company  and  Ors., [1988] 3 SCC 570 read as follows:           "Consequently,  the Governor of Mysore is  pleased          to   sanction   the   following   incentives    and          concessions  to the entrepreneurs for starting  new          industries in Mysore State:          (1)  Sales Tax-A cash refund will be allowed on all          sales  tax paid by a new industry on  raw  material          purchased by it for the first (five) years from the          date the industry goes into production, eligibility          to the concessions being determined on the basis of          a  certificate  to be issued by the  Department  of          Industries and Commerce...."      Though this again was in the form of a Government order giving  incentives  and concessions, this  Court  held  that since there is a power to grant an exemption or  concessions under  the Statue the mere fact that it did not specify  the power under which it was issued will make no difference  and that  the assessee would be entitled to the benefit of  this order.      The  High  Court was of the view  that  the  Government orders are, as such, not exemption orders but only a  policy decision.  The learned Judges observed that Section 5 of the General  Sales Tax Act "does not speak of general  order  of exemption   as the power to grant exemption is related to                                                        201 a  class  of  dealers  or goods  and  that  too  subject  to restrictions and conditions as may be prescribed.  So  there could  no general order of exemption and hence the need  for specific  order  in  favour  of  the  petitioner  is   quite obvious."   On this interpretation the High Court held  that the  appellant has to first establish that he had set up  an industry  in the State which conforms to the intent of  1971 order and thereafter ask for an exemption and that on  being satisfied  the  Government  will have to make  an  order  of exemption under section 5 of the General Sales Tax Act.   We are  unable  to  agree with this reasoning  of  the  learned Judges  on  the interpretation of section 5 of  the  General Sales  Tax Act.  We are of the view that the High Court  was in  error  in thinking that the exemption  order  should  be specific  in favour of the appellant.  The exemption as  can be  seen  from the provisions of section 5  of  the  General Sales Tax Act could be in respect of any class of dealers of any goods or class or description of goods.  There could  be an  exemption  in  an  individual  also  but  the  power  of

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exemption  is  not restricted to such cases alone.   It  may refer to transactions of sale of a particular type of  goods or class or description of goods or in respect of any  class of  dealers or a combination of both.  Of course even as  an order  of exemption the appellant will have to show that  he had  set  up the industry in conformity with the  intent  of 1971 order and entitled in terms thereof to the exemption in respect  of the goods manufactured by him.  But that is  not to say that after he establishes those facts the  Government will have to make a separate order of exemption in  relation to him.      When  the appellants sought to rely on the decision  of this  Court in Pournami Oil Mills case (supra)  the  learned Judges  of the High Court sought to distinguish the same  on the  ground that the Government order in Pournami Oil  Mills case  (supra) used the words ‘will be exempted’  whereas  in the Government orders now under consideration the words used are  ‘will be granted exemption.’  According to the  learned Judges   there  is  a  vast  difference  between   the   two expressions.   Whereas the expression ‘will be exempted’  is in  the nature of an order the expression ‘will  be  granted exemption’ clearly implies a declaration of intention  which could result in an order of exemption being issued by taking further follow up action.  We have carefully considered this reasoning  of  the learned Judges.   The  Government  orders follow  an  earlier Cabinet decision to give  incentives  to large medium scale industries.  The intention was clear that they  wanted  to  attract entrepreneurs from  all  over  the country  to  come and establish industries in the  State  of Jammu  and  Kashmir.   It  is  not  with  reference  to  any particular  industrialist  or industry that  the  order  was intended   to  be  operative.   The  subject  in  both   the Government  orders show that it is grant of incentives.   In the  light  of the context in which expressions came  to  be used we are                                                        202 of  the view that  ‘will be granted exemption’ has the  same meaning  as ‘will be exempted’ and does not in any way  show that  it  requires  a further follow  up  action.   Even  in Pournami Oils Mills case (supra) under the Government  order dated  11th  April,  1979 the industries  which  are  to  be benefited  are those which are to be set up on or after  1st of April, 1979.  The exemption is thus with are to be set up on or after 1st of April, 1979.  The exemption is thus  with reference  to  an  industry  which  is  to  be   established subsequent to the Government order.  Therefore in that sense both expression mean the same.      It  was then pointed out by the learned Judges  of  the High  Court  that  this  Government  Order  No.  159   dated 26.3.1971  dealt  with  to grant  four  different  types  of facilities and incentives and three out of them are  covered by  different legislative enactments and, therefore, it  was futile to contend that without any follow up action the said order can be treated as notification of exemption under  the different  statutes.   We  are unable  to  agree  with  this reasoning  of the learned Judges also.  As we  have  already pointed  out  there  is  no  prescribed  form  for  granting exemption  under  section 5 of the General  Sales  Tax  Act. There is also no prohibition against reference to any  other matter or matter in exemption orders under section 5 of  the General  Sales Tax Act.  If the incentives related  also  to other benefits or rights merely because they are included in the  same Government Order does not make it any the less  an exemption  order so far as the exemption related to  payment of  Sales Tax. In fact it appears to be that  factually  the

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submission of the learned counsel for the State that  follow up action was taken in pursuance of the Government order  in respect  of  exemption  from the  levy  of  Urban  immovable property  tax and the exemption from levy of  an  additional surcharge  on toll tax is not correct.  Mr.  Verma,  learned senior counsel appearing for the State of Jammu & Kashmir in two of the appeals referred to what he called as a follow up action  in  relation to the exemption from  payment  of  tax under  the  Urban  Immovable Property  Act,  a  notification issued  on the 3rd of June 1971 in SRO 214 of that date,  in exercise of the powers conferred by section 23 of the  Jammu and Kashmir Urban Immovable Property Tax Act, 1962  amending the  Immovable  Property Tax Rules, 1962 by  inserting  Rule 20A.   The  relevant portion of this Rule  20A  stated  that under  the  provisions of clause (f) of sub section  (1)  of section  4  of  the Act "all buildings and  lands  owned  by proprietors  of a factory and used by him for  the  purposes thereof  shall be exempted from the levy of tax etc..".   It is true that this notification was subsequent to GO 159-Ind. dated  26.3.1971.   But  it is seen  from  the  notification itself  that the same was previously published on  25.3.1971 in   the   Government  Gazette  under  section   23(1)   for information  of  all persons likely to be  affected  thereby informing that notice is given thereby that it                                                        203 will  be  taken  up for consideration on  7.4.1971  and  any objection or suggestion which may be received in the Finance Department  from any person with respect to the  said  draft before  the said date will be considered by the  Government. It  is by reason of the fact that this draft rule  has  been published  calling  for  objection the GO  159  Ind.  itself stated  that the grant of immovable property  tax  exemption would be available "as admissible under the Urban  Immovable Property  Taxation  Rules."   Thus  on  the  day  when   the Government  order  was  made there  was  already  the  draft amendment rules, and therefore, it could not be stated  that the  amendment  was a follow up action in pursuance  of  the Government order.  Rather the Government order refers to the draft and says as per the amendment they will be entitled to the  exemption.   So far as the toll tax  is  concerned  the notification  dated  18.7.1977  relied  on  by  the  learned counsel  for  the respondents only extended the  benefit  of exemption to large and medium scale industries in respect of additional  toll  leviable ‘till the construction  phase  is completed’  that  is  in  respect  of  tax  on  construction materials and it did not relate to the grant of exemption of additional surcharge on toll tax.  But it is significant  to note  that  this notification itself stated  that  ‘the  raw materials  brought  into  the  stage  for  the  purpose   of manufacturing  and  finished products marketed  outside  the State  by  the  said industries  shall  remain  exempt  from payment  of  additional toll for a period of  ten  years  in respect  of all the units from the date of  commencement  of production  by them." (emphasis supplied).  This  definitely shows  that  there is already an exemption from  payment  of additional  toll  in respect of raw  materials  brought  and finished  product marketed and the Government order  related only to an extension of exemption benefit in respect of  the construction  phase as well.  These notifications under  the Immovable Property Tax Act and Toll tax act rather reinforce thus  contention  of the learned counsel for  the  appellant that  the Government orders themselves are exemption  orders under  section 5 of the General Sales Tax Act and no  follow up  action  was  intended under those orders  and  the  said orders operate as exemption orders.  Thus there could be  no

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doubt the Government Order 159-Ind. dated 26.3.1971 and  the amending Government Order 414 dated 25.8.1971 are orders  of exemption  from payment of sales tax issued under section  5 of the General Sales Tax Act.      Though  the learned counsel for M/s  Kashmir  Vanaspati Limited  and  the  learned counsel appearing  tr   M/s  K.C. Vanaspati strenuously argued that the exemption from payment of  tax  was  extended  from 5 years to  10  years  and  the Government  was bound to give the exemption for 10 years  on the  ground  of  promissory estoppel.   We  think  there  is absolutely no factual foundation for such a plea.  The  only reference to 10 years was in                                                        204 the  Finance  Minister’s speech and in  the  Brochure  dated September,  1978.  The Brochure only lists  the  concessions and  incentives available generally.  It does not  refer  to any Government decision or Cabinet decision or any order  of the Government.  No decision of the Government, let alone  a Cabinet  decision,  or any Government  order  extending  the period of exemption was produced before us.  It is not clear on what basis the Brochure mentioned 10 years.  Further  the reference  in the Brochure is not for sales tax  alone,  but also  refers  to  toll tax and central  sales  tax.   It  is noticed  that  so  far as toll tax is  concerned  there  are Government  orders exempting the industries covered  by  the notifications  for  a  period  of  10  years.   The  Finance Minister’s  statement made in March, 1978 only refers  to  a proposal to continue the grant of exemption from payment  of sales tax for a period of 10 years.  This statement also  is not  unambiguous.  It may mean that the benefits  under  the Government  Orders 159 and 414 may be continued for  another 10  years  without withdrawing the same.  This is  merely  a budget  proposal  which could give rise to no right  to  the appellants.   As  no  decision  order  or  notification   is produced  extending the period of exemption in  relation  to sales  tax it is not possible to consider the claim  of  the appellants  for  exemption  for 10 years on  the  ground  of promissory estoppel.      In  exercise  of the powers under section 4(7)  of  the General  Sales  Tax  Act the Government  notified  that  "In supersession  of  all  the  previous  notifications  on  the subject,  the Government hereby specify, in column 3 of  the Schedule appended thereto, the point of tax on the  turnover in the series of sales of goods specified in column 2 of the said schedule.  "This was notified and published as SRO  195 dated  31.3.1978.   The  schedule  in  column  2  gave   the description  of  the goods and the column 3  point  of  tax. This  schedule  was amended by SRO 448 dated  22nd  October, 1982 the relevant portion of which read as follows:          "SRO 448-.  In exercise of the powers conferred  by          sub-section (7) of section 4 of the Jammu & Kashmir          General  Sales  Tax  Act, 1962 (XX  of  1962),  the          Government  hereby direct that in notification  SRO          195 dated 31.3.1978, the following amendments shall          be made namely :-          (1)   Sub-item  (C) in column 2 under  the  heading          "Goods manufactured in the State" appearing against          serial No. 2 shall be numbered as sub-item (d)  and          before  sub-item (d) as so numbered  the  following          shall be inserted as sub-item (c)          (c) Vanaspati and edible Oils.                                                        205 (i)   When sale is made by        2nd sale in the  State       manufacturer to another     i.e. Sale is made by       dealer in the State for     such dealer who  purchases

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     re-sale.                    goods from the manufact-                                   urer. (ii)  When sale is made by        Ist sale in the State i.e.       manufacturer to             when sale is made by the       consumer direct.            manufacturer.           By order of the Government of Jammu & Kashmir."      Before  the  High  Court  the  vires  of  SRO  448  was questioned  on  various grounds.  However,  the  High  Court rejected all those contentions and held that it is valid and that it has superseded the exemption, if any, granted  under G.O.  159 and 414.  Mr. Thakur, the learned counsel for  M/s Kashmir  Vanaspati and Mr. Beg, learned senior  counsel  for M/s. K.C. Vanaspati, apart from contending that SRO 448  was ultra vires also contended on merits that this had no effect of  superseding  exemption granted under  the  said  orders. Since we are agreeing with the learned counsel that this SRO did not and could not supersede the exemption granted  under the  said  Government  orders  we are  not  going  into  the question of vires of the same.      As  may  be  seen  from SRO  195  dated  31.3.1978  the notification  was made by the Government in exercise of  the power  under section 4(7) of the State Act which related  to the power to fix a point of sale for purposes of taxation in the  series  of sales of goods.  In  fact  the  notification specifically  stated that it is made in supersession of  all previous  notifications  on the subject  and  specified  the point of tax on the turnover in the series of sales of goods specified  in column 2 of the Schedule (emphasis  supplied). The  said notification therefore could not have and did  not supersede  the  exemption  notification SRO 448  dated  22nd October, 1982 that vanaspati and edible oils are taxable  at the  point  specified  therein  it  only  means  that  those vanaspati and edible oils which are not exempted are taxable at  the points specified in the Schedule.  It may  be  noted that  the  Government  order gave exemption  only  for  five years  from  the date of commencement of  the  industry  and those  industries who had been manufacturing for  more  than that period and also those industries who were not  entitled to the benefit of the said Government order would be  liable to  pay sales tax on the vanaspati manufactured by them  and the said goods were                                                        206 liable to tax at the point specified in the Schedule.      In  the Scheme of levy of single point taxation,  there could be no doubt, the Government could fix and point in the series  of sales for the Government have fixed the  sale  by the dealer, that if the second sale, as the taxable point no exception can be taken.  In that sense no question of  vires on the ground of lack of power would arise.      Under Section 4(1) of Jammu & Kashmir General Sales Tax Act  the  goods are taxable only once, that is it  could  be taxed only at one point of sale.  We have already held  that the  Government Orders 159 and 414 are exemption orders  and exempt   the  sale  by  appellants  of  their   manufactured products.   The exemption would not arise unless  the  goods are taxable at the point of their sale.  Thus the effect  of exempting their sale is that the said goods manufactured  by them  could not be taxed at the second or  subsequent  sales also  as that would offend section 4(1) which  provides  for single  point  levy.  In case where there are  no  exemption orders and the state fixed the second or subsequent sale  as point of taxation the first or prior or subsequent sales are not  exempted sales but are not taxable  sales.   Therefore, SRO 448 fixing the sale of vanaspati ghee by a dealer  would not  be  applicable to vanaspati ghee  manufactured  by  the

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appellant which are exempt under the said Government orders. No question of vires of SRO 448 thus arises in these  cases. Thus  we are not called upon to decide the vires of SRO  448 on  the  ground of discrimination as in our view  the  goods manufactured  by the appellants are exempt under  Government Orders  159 and 414 and that exemption covers entire  series of sales of that very goods.      As  already noticed in the case of Pine  Chemicals  the assessment  orders related to their liability for tax  under the  Central  Sales Tax Act in respect of  their  interstate sales.   The High Court has not considered their  claim  for exemption  under  section 8 (2-A) of the Central  Sales  Tax Act.  They seem to have proceeded on the assumption that  if Government  orders  159  and  414  above  referred  to   are exemption  orders  or  if  the  dealers  were  entitled   to exemption under the State Act on the principle of promissory estoppel they would automatically be entitled to the benefit of  section 8 (2-A) of the Central Sales Tax Act.   However, probably since the High Court was of the view that the  said Government  orders  are not exemption orders  and  that  the appellant  had not laid the factual foundation for  claiming the   benefit  of  promissory  estoppel,  the  question   of consideration of the applicability of section 8 (2-A) of the Central Sales Tax Act did not arise and was not  considered. In  fact the appellants in the special leave petition  after claiming  that the Government orders above referred  to  are exemption orders                                                        207 and  that in any case on facts they have  established  their case  of promissory estoppel and the Government is bound  to give  exemption, stated as a ground that in the  High  Court the  Advocate General made a concession to the  effect  that "he  was not disputing that if the appellants were  entitled to exemption in respect of finished goods under section 5 of the  Jammu & Kashmir Sales Tax Act they would  automatically be  exempted under section 8 (2-A) of the Central Sales  Tax Act in respect of interstate transaction."  On the basis  of this  concession  it appears that the appellants  have  also filed a review petition against certain observations made in the judgment of the High Court.  However, in the reply filed by the State in the special leave petition in this Court  of the  Government have denied that any concession was made  by the Advocate General of the State in the High Court and that in any case the concession referred to related to a question of Law and that the State is entitled to press that point in this  Court.  In these circumstances we have  permitted  the State to raise the question that even if the said Government orders were exemption orders under section 5 of the  General Sales Tax Act the appellants are not eligible for  exemption in  respect of their interstate sales under section 8  (2-A) of the Central Sales Tax Act.      Under  section 6(1) of the Central Sales Tax Act,  1956 every  dealer  who sells goods in the  course  of interstate trade or commerce shall be liable to pay tax under that Act. A sale of goods shall be deemed to take place in the  course of  interstate trade or commerce if the sale  occasions  the movement  of goods from one state to another or if  effected by  a  transfer of documents of title to  the  goods  during their  movement from one State to another.  The rate of  tax on  sales in the course of inter-state trade of commerce  is fixed under section 8 of the Central Sales Tax Act. The  tax payable  by any dealer under the Act shall be  collected  in the State  from which the movement of the goods commenced by the  assessment  officers  of that State on  behalf  of  the Government  of  India in accordance with the  provisions  of

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section  9(2)  of  the Central Sales Tax  Act.  The  learned Advocate  General of Jammu & Kashmir contended that even  if the sale of a particular commodity is exempted from  payment of  tax under the local Act the dealer selling the  same  in interstate trade or commerce would be liable to pay  central sales  tax   under the provisions of section  6(1A)  of  the Central  Sales Tax Act. His further submission was  that  if section 6(1A) of the Central Sales Tax Act is applicable  to a  particular  transaction  of sale section 8  (2A)  of  the Central  Sales  Tax  Act would not  be  applicable  to  that transaction.           Section 6(1A) of the Act reads as follows:                                                        208      "(1-A)  A dealer shall be liable to pay tax under  this Act on a sale of any goods effected by him in the course  of inter-state  trade or commerce notwithstanding that  no  tax would  have  been  leviable (whether on the  seller  or  the purchaser) under the sales tax law of the appropriate  State if that sale had taken place inside that State."      In other words the liability of a dealer to pay Central Sales Tax on his interstate transactions of sale will not be affected  merely on the ground that if the same  dealer  had sold the goods locally he would not have been liable to  pay tax  under  the local Sales Tax Act.  This is  part  of  the general provisions of Section 6 of the Central Sales Tax Act making  a  dealer liable to tax on inter-state  sales.   The rate  of tax payable on inter-state sale is fixed at  4%  in the  case  of sales to a registered dealer of goods  of  the description coming under section 8 (2) of the Central  Sales Tax  Act  or where the sale is to a Government  and  at  10% under Section 8 (2) (b) of the Central Sales Tax Act in  the case  of  goods other than declared goods.   In  respect  of declared  goods under section 8(2) (a) of the Central  Sales Tax  Act  shall be payable at twice the rate  applicable  to sale or purchase of such goods inside the appropriate State. In  view of the provisions of Section 15 the State  law  can impose  tax  on sale of declared goods only at  a  rate  not exceeding four per cent of the sale price and such tax  also shall not be levied at more than one stage.  If the tax  has been  levied under the State Law on declared goods and  such goods  are sold in the course of inter-state trade  and  tax has  been  paid under the Central Sales Tax the  tax  levied under the State law shall be reimbursed to the person making such sale in the course of inter-state trade.      Section  8 (2A) of the Central Sales Tax Act is in  the nature  of an exception to these general  provisions.   That sub-section reads as follows:          "8(2-A) Notwithstanding anything contained in  sub-          section (1-A) of section 6 or in sub-section (1) of          this  section,  tax  payable under this  Act  by  a          dealer  on this turnover in so far as the  turnover          or  any  part thereof relates to the  sale  of  any          goods,  the  sale  of,  as the  case  may  be,  the          purchase  of which is, under the sales tax  law  of          the appropriate State, exempt from tax generally or          subject  to tax generally at a rate which is  lower          than four per cent (whether called a tax or fee  or          by  any other name), shall be nil or, as  the  case          may be, shall be calculated at the lower rate.          Explanation-For  the purpose of this sub-section  a          sale or                                                        209          Purchase  of  any goods shall not be deemed  to  be          exempt  from tax generally under the sales tax  law          of the appropriate State if under that law the sale

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        or  purchase  of  such  goods  is  exempt  only  in          specified   circumstances   or   under    specified          conditions  or  the tax is levied on  the  sale  or          purchase  of  such  goods at  specified  stages  or          otherwise  than with reference to the  turnover  of          the goods".      It may be seen from these provisions that Section 8 (2- A) of the Central Sales Tax Act does not have any overriding affect  on  the scheme of taxation relating  to  inter-state sale  of  declared  goods.   There is  also  scope  for  the applicability  of Section 6 (1-A) of the Central  Sales  Tax Act when the inter-state sale takes place when the goods are in transit and is effected by transfer of documents of title to  the  goods  during  their movement  from  one  State  to another.   There may be other instances also which  may  not affect the levy under section 6(1A) of the Central Sales Tax Act as in case where Section 8(2-A) of the Central Sales Tax Act  was  not  applicable though  the  transaction  was  not taxable  under the State law.  Suffice it to say  that  only certain cases which would have been covered by Section  6(1- A) of the Central Sales Tax Act have been carved out for the purpose of exemption subject to the applicability of section 8  (2-A) of the Central Sales Tax Act.  Section 6  (1-A)  of the Central Sales Tax Act has not become otiose by reason of inclusion  of  that section in the  non-obstante  clause  in section  8(2-A).   Both provisions, therefore,  operate  and they  should not be read so as to nullify the effect of  one another.      On  a  plain reading of section 8(2-A) of  the  Central Sales Tax Act it deals with the liability of a dealer to pay tax under the Act on his inter-state sales turnover relating to  any goods on the turnover relating to such goods if  the sale had taken place inside the State is exempt from payment of  sales  tax under the sales tax law  of  the  appropriate State.  It provides that if an intra-state sale or  purchase of a commodity by the dealer is exempted from tax  generally or subject to tax generally at a rate which is lower than  4 per  cent then his liability to tax under the Central  Sales Tax  Act  when such commodity is sold on  inter-state  trade would  be  either  nil  or  as the  case  may  be  shall  be calculated at the lower rate.  Explanation states as to when the  sale or purchase shall not be deemed to be exempt  from tax  generally under the sales tax law.  That is to  say  an intra-state  sale  or purchase of a commodity shall  not  be deemed  as exempt from State tax generally if the  exemption is  given  only  (1) in  specified  circumstances  or  under specified conditions or (2) the tax is leviable on the  sale or  purchase  of  such  goods at  specified  stages  or  (3) otherwise than with reference to the turnover of                                                        210 the  goods.  These conditions or limitations  are  therefore with reference to the transaction of sale or purchase.   The main clause deals with the turnover of ‘a dealer’ which  the term  would include ‘any dealer’ or ‘any class of  dealers’. The  existence or otherwise of the three  limitations  under the  explanation  above referred to  on  claiming  exemption under  section  8(2-A)  of the Central Sales  Tax  Act  will therefore,   have  to  be  tested  with  reference  to   the transaction  of sale or purchase as the case may be  of  the dealer who claims the transaction of sale or purchase as the case  may  be  of the dealer who  claims  the  exemption  in respect  of  his intra-state sale of purchase  of  the  same goods.   Thus the specified circumstances and the  specified conditions  referred  to in the explanation should  be  with reference  to  the  local turnover of the  same  dealer  who

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claims  exemption under section 8(2-A) of the Central  Sales Tax Act.      The  learned Advocate General for the  state  contended that  the conditions that the industry should have been  set up and commissioned subsequent to the Government orders  159 and  414 above referred to and the commodity sold by him  in order  to  claim  the exemption under  the  said  Government order,  shall  be those manufactured by  that  industry  are conditions or specified circumstances within the meaning  of the explanation and, therefore, the dealer (Pine  Chemicals) is  not entitled to any exemption under section 8  (2-A)  of the Central Sales Tax Act.  We are unable to agree with this submission of the learned counsel for the state.  The  facts which  the  dealer has to prove to get the  benefit  of  the Government  orders are intended only to identify the  dealer and  the goods in respect of which the exemption  is  sought and   they   are  not  conditions   or   specifications   of circumstances relating to the turnover sought to be exempted from payment of tax within the meaning of those  provisions. The  specified  circumstances and the  specified  conditions referred  to  in  the  explanation  should  relate  to   the transaction of sale of the commodity and not  identification of  the  dealer  or the commodity in respect  of  which  the exemption is claimed.  These conditions relating to identity of  the  goods  and the dealer are  always  there  in  every exemption and that cannot be put as a condition of sale.  We have already held that not only sale by the manufacturer  to dealer that is exempt under the Government orders but  since the  General Sales Tax Act had adopted only a  single  point levy,  even  the subsequent sales would be  covered  by  the exemption order.  Therefore, the question whether the tax is leviable on the sale or purchase at "specified stages"  does not arise for consideration.  This is not also a case  where the  exemption  is with reference to some thing  other  than the turnover of the goods.      In  this  connection we may refer to two  decisions  of this  Court reported as Indian Aluminium Cables Ltd. &  Anr. v. State of Haryana (38                                                        211 STC  108)  and  Industrial Cables India  Ltd.  v.  Assessing Authority.   [1986]   sup.  SCC  695.   The   question   for consideration  in this case was whether the  transaction  of sale which would be covered by section 5 (2)(a) (iv) of  the Punjab  Sales  Tax Act could be said to be exempt  from  tax generally  within  the  meaning of section  8(2)(a)  of  the Central  Sales Tax Act.  Section 5 (2A) in  effect  provided that  in  determining the taxable turnover of a  dealer  his turnover  on  "(iv)  sales  to  any  undertaking   supplying electrical energy to the public under a licence or  sanction granted  or  deemed to have been granted  under  the  Indian Electricity Act, 1910(IX of 1910), of goods for use by it in the  generation  or distribution of such energy"  is  to  be deducted.   That is to say that the transaction  covered  by this clause are exempt from Punjab Sales Tax Act.  As may be seen  from  the provision the two conditions relate  to  the purchaser  company  being a licensed  undertaking  supplying electrical  energy to the public and the goods sold are  for use by the said undertaking in generation or distribution of such  energy.   This court rejected the  contention  of  the dealer  that  they  are descriptive of  the  goods  and  not conditions  and  held that they are conditions  under  which exemption  is granted and that therefore  section  8(2A)  of the Central Sales Tax Act was not attracted. As may be seen, the  two conditions are attached to the sale of  the  dealer who  is  liable to pay sales tax.  The  description  of  the

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person  who  is  to  be the purchaser  is  not  intended  to identify  the seller but relate to a condition of  the  sale being  to a person of that description.  The condition  that the  goods sold are for use by the licensed  undertaking  in the generation or distribution of electrical energy is again a  condition attached to the sale and not identification  of the goods .  The goods are already identified.  If the  same goods  had  been  sold to a person who  is  not  a  licensed undertaking and/or not for purposes of use in the generation or  distribution of electrical energy the transaction  would be liable to levy of tax under local Sales Tax Law.  If  the conditions  specified  are satisfied then  that  transaction which  would  have  otherwise formed  part  of  the  taxable turnover  is allowed to be deducted from the  total  taxable turnover.    Clearly,   therefore,   they   are    specified circumstances or specified conditions within the meaning  of the  explanation to section 8(2A) of the Central  Sales  Tax Act  and  therefore cannot be treated as exempted  from  tax generally.      There  is also another judgment of this Court,  namely, International Cotton Corporation (P) Ltd. v. Commercial  Tax Officer  &  Ors.,  (35 STC 1) wherein  they  have  generally considered the scope of section 8 (2A) of the Central  Sales Tax Act.  After a consideration of the arguments the learned Judges observed:                                                        212          "Reading section 6(1-A) and section 8(2A)  together          along with the explanation the conclusion deducible          would  be  this:  Where the  intra-state  sales  of          certain  goods are liable to tax, even though  only          at  one  point, whether of purchase or of  sale,  a          subsequent  inter-state sale of the same  commodity          is  liable to tax, but where that commodity is  not          liable to tax at all if it were an intra-state sale          the  inter-state sale of a particular commodity  is          taxable  at a lower rate than 3 per cent  then  the          tax  on the inter-state sale of tax commodity  will          be  at that lower rate. A sale or purchase  of  any          goods  shall not be exempt from tax in  respect  of          inter-state  sales  of those commodities if  as  an          inter-state  sale  the purchase or  sale  of  those          commodities    is   exempt   only    in    specific          circumstances or under specified  conditions or  is          leviable  on  the  sale or  purchase  at  specified          stages.   On  this interpretation section  6(A)  as          well as section 8 (2A) can stand together."      In  view  of the pronouncement of this Court  in  above decisions  and  on our interpretation we do not consider  it necessary to refer to the decisions of the High Courts cited at  the  bar.  In the result we hold that the  dealer  "Pine Chemicals"  is  entitled to claim the benefit  of  exemption under  G.O.  159  dated 26.3.1971 and G.O.  414  Ind.  dated 25.8.1971  in respect of his turnover on  inter-state  sales and  the benefit of exemption is available for a  period  of five years from the commencement of commercial production.      Mr.  Verma  learned  counsel appearing  for  the  State Government  then contended that the said  Government  orders were  superseded  by  SRO 80  dated  12.3.1982  (hereinafter referred  to as SRO 80/82) and Vanaspati Ghee has been  made liable  to  tax at the rate of eight per  cent.   The  goods manufactured by M/s. Pine Chemicals are also made taxable as falling under the residuary item at the rate of 8 per cent.      S.R.O. 80 dated 12th March, 1982 reads as follows:          "In  exercise  of  the  powers  conferred  by  sub-          section  (1)  of section 4 of the Jammu  &  Kashmir

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        General  Sales  Tax Act, 1962 (XX of 1962)  and  in          supersession  of  all  the  previous  notifications          issued on the subject, the Government hereby direct          that  the  tax  on the taxable  turnover  shall  be          payable  at the rates specified in schedule A-1  to          A-XI annexed hereto :           Further the Government, in exercise of the  powers          conferred  by  section  5 of the said  Act  and  in          supersession  of  all  the  previous  notifications          issued  on  the  subject, hereby  direct  that  the          goods,                                                        213          persons  and  classes of persons  as  specified  in          Schedule  "B" annexed hereto shall be  exempt  from          payment of tax leviable under said Act.          Explanation:-Nothing  contained  in  schedule   ‘B’          shall  be deemed to exempt any goods  specified  in          Schedule A-I to A-XI (both inclusive).          This notification shall come into force with effect          from 1-4-1982.          By order of the Government of Jammu & Kashmir."      It then sets out the description of the goods  and  the rates  at which they are taxable in Schedule A, Annexures  I to XI.  Items 1 to 3 schedule "A" Annexures IV, reads:                         SCHEDULE A IV                Goods chargeable to tax at 8%      1.  Hydrogenated         vegetable oil          (Vanaspati) and palm oil of all sorts.      2.  Lubricants.      3.  All  goods other than items (1) &  (2)  above  and          those specified in other Schedules.      4.  x    x       x"      In  Schedule  B  goods except under section  5  of  the General Sales Tax Act are set out. Vanaspati Ghee is not one of the items of goods exempted under Schedule B.      The  learned counsel for the appellants contended  that the  second  paragraph  in  the  SRO  only  superseded   the ‘notification’ under Section 5 of the General Sales Tax  Act made  earlier  and did not supersede and did  not  have  the effect  of  superseding  the  Government  orders  made,  in pursuance   of  policy  decisions  taken  by  the   Cabinet, exempting  from  payment  of  tax as  an  incentive  to  the industries.   In  any  case the  exemption  for  five  years granted  under  the  said Government  orders  could  not  be withdrawn so far as the appellants are concerned both on the ground that SRO 80/82 was prospective in operation and  also on the ground of promissory estoppel.                                                        214          There  could  be  no  doubt  that  SRO  80/82   was          prospective  in operation.  We have noticed in  the          earlier  part of this judgment that the  Government          seems  to have been following as a pattern that  is          in  the  case  of  incentives  to  industries   the          exemption orders had taken the form of a Government          order.   Government order 159 and 414 were also  in          pursuance of a Cabinet decision.  SRO 80/82  though          a Government notification under the Business  Rules          it  is  issued by the Ministry  concerned.  In  the          circumstances we have also a serious doubt  whether          the  said incentives could have been superseded  by          the said SRO 80/82.      In  this  connection we may also  refer  to  Government order  No.  54 Ind. of 1983 dated 26.2.1983 again  an  order made  in  pursuance  of  Cabinet  decision  which  reads  as follows:

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        "CIVIL SECRETARIAT INDUSTRIES & COMMERCE DEPARTMENT          GOVERNMENT OF JAMMU AND KASHMIR          Incentives  for development  of  Large/Medium/Small          Scale  and  Tiny  Sector  Industries  in  Jammu   &          Kashmir.          Cabinet Decision No. 57 dated 5.2.1983          GOVERNMENT ORDER NO. 54-IND OF 1983                      Dated 26-2-1983          In  supersession  of  all  previous  orders  it  is          ordered  that  the  package of  incentives  as  per          Annexure  to this order will now be  applicable  to          the  existing and new Large Medium/Small Scale  and          Tiny Industrial Units.          2.  Such of the Industrial Units which have  partly          availed  of the package of  incentives,  sanctioned          under  Government Order No. 391-Ind. of 1972  dated          21.6.1972   and   subsequent   orders   issued   in          amplification thereof, as well as such units  which          have  become  entitled  to  the  availment  of  the          earlier  package  of  incentives,  shall  have  the          option  to  get benefit under the  new  package  of          incentives, sanctioned hereunder, for the remaining          period of their entitlement.                                                        215          3. X         X         X          4. X         X         X          5. X         X         X          6. X         X         X          By order of the Government of Jammu & Kashmir.                          Sd. J.A. Khan     Secretary   to   Government  Industries   and   Commerce Department."      The  annexures  to this order contain  the  incentives, benefits  privileges and priorities given to  large,  medium and  small scale industries and tiny industries.  So far  as sales tax payable by large and medium scale industries which is  relevant  for our purpose paragraph XII/XIII  states  as follows:          "XII/XIII. GST/CST/Additional Toll Tax on SSI Units          and Medium/Large Units:          (i)  No  GST shall be charged on any  raw  material          purchased  by any industrial units except on  items          brought on a negative list.          (ii)  X        X         X          (iii) X        X         X          (iv) An equivalent amount of loan would be  granted          interest  free  to  Medium and Large  Units  for  a          period  of  10 years against GST/CST  paid  in  the          State,   each   installment  of   loan   shall   be          recoverable  in  7 years after a  moratorium  of  3          years, the total amount of tax-loan at any point of          time not to exceed 33% of capital investment or Rs.          25 Lakhs whichever is less.  Penal rate of interest          may be prescribed for delay in repayment of loan.          (v)  X       X        X          (vi) X       X        X"                                                        216      It may be seen that paragraph I of this order refers to ‘supersession  of  all previous orders’ and then  speaks  of package  of  incentives  and then states  as  applicable  to existing  large  and medium scale industries also.   If  SRO 80/82 had superseded G.O. 159 and 414 does it mean that this Government order has superseded SRO 80/82 and if that is  so what  are  incentives  available  after  SRO  80/82  to  the existing   industries?   This  Government  order   is   thus

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consistent  with  the pattern followed and deals  only  with incentives to industries.  In the second paragraph an option has  been given to the industry which has not  utilised  the full benefit of the earlier exemption either to continue  to enjoy the earlier exemption given by way of incentive or  to opt  for  the scheme of incentive under the  new  Government order.   Thus all, these provisions are consistent with  the case of the appellants that neither SRO 80/82 superseded  GO 159  and  414 nor Government order 54 dated  26.2.1983  took their  right to continue to enjoy the exemption benefit  for the  total  period  of five years as provided  in  the  said Government orders.      The  learned counsel for the appellants also  contended that  they  are entitled to enjoy the benefit for  the  full period  of five years both on law as also on the  ground  of estoppel.  We have already noticed that in Bakhul  Oil  case (supra)  this  Court  held that in the case of  a  grant  of exemption  without  specifying  any  period  for  which  the exemption  is  available the Government could  withdraw  the same  at any time.  Though in that case on facts no  further question can arise since it was held that the dealer was not entitled  to  the  benefit of  the  subsequent  notification giving  the  exemption  for a period of five  years  on  the ground  that the notification was prospective  in  operation and  therefore  not applicable to the dealer in  that  case, this  Court made certain further observations to the  effect that  even in the case of exemption for a particular  period it  could be withdrawn at any time subject of course to  the plea  of  estoppel.   In Pournami Oil Mills  case  also  the learned   Judges  appear  to  have  given  the  benefit   of exemptions for the full period even after the withdrawal  on the basis that the industry was set up in pursuance of  some representation made by the Government amounting to estoppel. In  the present appeals also there are lot of  materials  to show  that the Government made representations  to  industry that they would give tax exemptions and other incentives and invited entrepreneurs to establish their industries in J.  & K.    Relying  on  those  representations  each   of   these appellants  have  set  up  their  industries.   It  is   not necessary to set out these factual details in the  judgment. Suffice it to say that we have carefully considered all  the materials and are of the view that the appellants acting  on the representations had set up their industries.   Therefore they are entitled to claim the benefit of the exemption  for the entire period of five years calculated                                                        217 as  per the terms of the Government orders, even if it  were to  be held that SRO 80/82 superseded the earlier  exemption orders.      It  was  then contended by Mr.  Verma  learned  counsel appearing  for  the  State  that  in  the  assessment  order relating  to  Assessment Year 1981-82 for  the  period  from 1.9.1981 to 30.8.1982 in the case of K.C. Vanaspati there is a  finding  that  the assessee had collected  sales  tax  in respect  of their sales turnover for which the exemption  is now  claimed and that under section 8-B of the  J&K  General Sales  Tax  Act  the  said  amount  is  refundable  to   the Government.    As  has  already  been  seen  there  was   an assessment order for the period covering from 2nd September, 1981 to 30th September, 1981 which was the subject matter of Writ Petition No. 52 of 1982.  The same period merged in the assessment  order  1.9.1981 to  30.8.1982  and  consolidated assessment  order  was made and that was subject  matter  of Writ Petition No. 882 of 1984.  Both these assessment orders were regular assessment orders and they are not section  8-B

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orders  of  the Local Act.  They were made on  the  findings that Government Orders 159 and 414 above referred to are not exemption orders and the assessee could not be said to  have acted  upon any representation by the Government  that  they are  exemption orders on the ground that if they had  relied on  those  orders as exemption orders they  would  not  have collected  any  tax  in  respect of  their  sales  and  that therefore the Government was not precluded by any  principle of promissory estoppel from assessing their sales  turnover. The assessees had challenged these assessment orders  mainly on  the  ground that the Government  orders  were  exemption orders  and  that in any case the State  is  precluded  from levying any sales tax on the ground of promissory  estoppel. The learned Judges of the High Court held, as already stated that,  the said Government orders were not exemption  orders but  were only in the nature of declaration of intention  to exempt  the  said industries from payment of sales  tax  and that  the  assessee had also not established any  right  for non-payment  of  tax on any ground of  promissory  estoppel. For  holding  that the assessees could not be said  to  have relied  on any representation from the Government that  they would  be  exempted from payment of tax the  learned  Judges relied  on the facts that the assessees had collected  sales tax  or the sales tax element had gone into the fixation  of price of Vanaspati Ghee showing thereby that the  appellants had  not  relied on any representation from  the  Government that their sales are exempt from payment of tax.  Since  the assessment  orders  were regular assessment  orders  on  the ground  that their sales are taxable sales the  question  of applicability  of  section  8 B of the local  Act  does  not arise.   That question arises  in view of our  finding  that their sales turnover are exempt but still under section 8  B of  the  Local  Tax  they are liable  to  refund  any  money collected "by way of a tax".  Since                                                        218 neither  the  High  Court had any occasion  to  decide  this question of applicability of section 8 B of the Local Act on the  basis that the sales turnover were exempt from  payment of tax nor the assessing authorities had any opportunity  to decide or made any order under section 8 B of the Local  Act separately,  we think that the entire question  relating  to the  applicability of section 8 B of the Local Act and  even the  question whether there was any collection of sales  tax will  have to be left open.  The learned counsel  Mr.  Verma strenuously  contended  that  there  is  a  finding  in  the assessment orders that the appellants had collected tax  and that finding had not been either challenged or set a side by the High Court and that therefore they should be directed to refund the amount collected.  We are not able to agree  with this  contention of the learned counsel.  As already  stated the  assessment  order  itself was questioned  in  the  writ petitions  filed  by  the assessees.   The  High  Court  had proceeded  on the basis that the Government orders  are  not exemption  orders  and  that the  Government  also  was  not precluded  from collecting tax on any ground  of  promissory estoppel and that therefore the question of applicability of section  8B of the Local Act did not arise before  the  High Court.  It may be mentioned it is not the case of the  State that  they  had  collected  any  amount  in  excess  of  the percentage  of  sales  tax i.e. collectable  in  respect  of taxable Vanaspati sales.  In the light of our findings  that the  sales were exempt the question now arises  whether  the assessees  had collected any tax and whether the amount  was collected by way of tax and whether any element of sales tax has merged in the fixation of the price and that amounts  to

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collection   of sales tax.  These questions will have to  be decided  if  the  State considers that  the   assessees  had collected  sales tax, in separate proceedings that may  have to  be initiated under Section 8 B of the Local Act or  when the State demands payment of the money under section 8 B  of the  Local  Act.  Suffice it so say that we  are  unable  to agree  with  the observations of the learned Judges  of  the High  Court  that  merely because in  the  balance  sheet  a reserve fund is made for payment of sales tax or on basis of a letter of Kashmir Vanaspati giving a break up of the sales price  of  Rs.  238  it  can  be  said  to  be  conclusively established  that sales tax had been collected.  Any way  we do not want to say anything because the matter will have  to be considered by the authorities concerned in case they want to invoke Section 8 B of the Local Act on the basis that the said government orders gave exemption from payment of  sales tax in respect of these assessees for a period of five years as  we have held.  In this view we are also not  going  into the question as to the validity of section 8 B of the  Local Act  and  we  leave open that question  which  was  outlined before us.  Thus interpretation of section 8 B of the  Local Act and the question of fact of collection and the liability to  refund  all have to wait till a demand is  made  by  the competent authority for refund of the amounts                                                        219 in  exercise of their power under section 8 B of  the  Local Act.  The assessees have made some deposits in pursuance  of interim  orders made by this Court pending the appeals.   It is  also stated that during the pendency some other  amounts were  also paid by the assessees in addition to the  amounts paid as per the directions given by the Court.  The  refunds of  this money and the liability of the State Government  to pay any interest while refunding the deposits will all  have to  await  the  demand,  if any, that may  be  made  by  the Government  under  section 8 B of the Local  Act.   However, we make it clear that the stay of refund of money  collected as  aforesaid  will be only for a period of  six  months  by which  time the Department should initiate  proceedings,  if any, under Section 8 B of the Local Act, if so advised.      To  sum up : G.O. 159 Ind dated 26.3.1971 and G.O.  414 dated  25.8.1971  are exemption from payment  of  sales  tax orders  referable  to  the powers of  the  Government  under Section  5  of  the J & K General Sales  Tax  Act  and  that exemption covers the entire series was available only for  a period  of five years from the date of commissioning of  the industries  and  not  for ten years.   The  benefit  of  the exemption   under  the  said  Government  orders  are   also available  in respect of the inter-State sales of  the  same commodities for a period of five years from the commencement of  the commercial production.  The appeals are  accordingly allowed to the extent mentioned above.  However, there  will be no order as to costs. V.P.R.                                       Appeal allowed.                                                        220