Rajasthan High Court - Jodhpur
Jk Cement Works Nimbahera vs State And Anr on 22 October, 2024
Author: Pushpendra Singh Bhati
Bench: Pushpendra Singh Bhati
[2024:RJ-JD:38774-DB]
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
D.B. Civil Writ Petition No. 2183/2003
Jk White Cement Works
----Petitioner
Versus
State And Ors
----Respondent
Connected With
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Rajasthan Barytes Limited
----Petitioner
Versus
State And Ors
----Respondent
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----Petitioner
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State And Ors
----Respondent
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State And Ors
----Respondent
D.B. Civil Writ Petition No. 3833/2002
Aravali Minerals And Chemical Indus.p.ltd.
----Petitioner
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State And Ors
----Respondent
D.B. Civil Writ Petition No. 3834/2002
Anand Kumar Agarwal
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----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 3835/2002
Best Chemical Limestone Indus.pvt. Ltd.
----Petitioner
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State And Ors
----Respondent
D.B. Civil Writ Petition No. 3836/2002
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----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 3846/2002
Narendra Kumar Nalwaya And Ors
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State And Ors
----Respondent
D.B. Civil Writ Petition No. 4309/2002
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----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 4310/2002
Ganesh Kumar Agarwal
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Versus
State And Ors
(Downloaded on 22/10/2024 at 09:52:56 PM)
[2024:RJ-JD:38774-DB] (3 of 18) [CW-2183/2003]
----Respondent
D.B. Civil Writ Petition No. 4311/2002
Kishan Agarwal
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 4312/2002
Grasim Industries Ltd.
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 4379/2002
Smt.sudha Parihar
----Petitioner
Versus
State And Ors.
----Respondent
D.B. Civil Writ Petition No. 4380/2002
Associated Soapstons Dist.co.pvt.ltd.sta
----Petitioner
Versus
Te And Ors.
----Respondent
D.B. Civil Writ Petition No. 1328/2003
Supreme Marble And Granite Limited
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 1329/2003
H.c.jain
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[2024:RJ-JD:38774-DB] (4 of 18) [CW-2183/2003]
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 1330/2003
M/s.j.j.minerals
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 1331/2003
Mining And Mineral Industries
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 1645/2003
Jk Cement Works Nimbahera
----Petitioner
Versus
State And Anr
----Respondent
D.B. Civil Writ Petition No. 1646/2003
Dharamveer Suneja
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 1647/2003
Zahoor Ahmed
----Petitioner
Versus
State And Ors
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[2024:RJ-JD:38774-DB] (5 of 18) [CW-2183/2003]
----Respondent
D.B. Civil Writ Petition No. 1648/2003
Satnam Singh
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 2181/2003
J.k.synthetics Ltd.
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 2182/2003
Mohd.sher Khan
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 5828/2003
Santlal
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 5829/2003
Udaipur Mineral Deve.syndi.p. Ltd.
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 5831/2003
Vallabh Mehta
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[2024:RJ-JD:38774-DB] (6 of 18) [CW-2183/2003]
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 5832/2003
M/s.golecha Mineral P. Limited
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 5835/2003
Smt.jamna Devi
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 6320/2003
Shakuntala
----Petitioner
Versus
State Andn Ors
----Respondent
D.B. Civil Writ Petition No. 6321/2003
M/s.harish Clays
----Petitioner
Versus
State And Ors
----Respondent
D.B. Civil Writ Petition No. 1548/2004
Jai Polymers Company Pvt.ltd.
----Petitioner
Versus
State And Ors
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[2024:RJ-JD:38774-DB] (7 of 18) [CW-2183/2003]
----Respondent
D.B. Civil Writ Petition No. 4381/2002
Birla Corporation Ltd.
----Petitioner
Versus
State And Ors.
----Respondent
For Petitioner(s) : Mr. Vikas Balia, Senior Advocate
assisted by Mr. D.D. Thanvi
Mr. Amit Vyas
Mr. Sachin Saraswat
For Respondent(s) : Mr. Mahaveer Bishnoi, AAG
HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI
HON'BLE MR. JUSTICE MUNNURI LAXMAN
Judgment
Reserved on 18/09/2024, 09/10/2024
Pronounced on 22/10/2024
Per Dr. Pushpendra Singh Bhati, J:
1. Since all the instant petitions involve a common controversy
though with marginal variation in the contextual facts, therefore,
for the purposes of the present analogous adjudication, the facts
and the prayer clauses are being taken from the above-numbered
D.B. Civil Writ Petition No. 2183/2003, while treating the same as
a lead case; rival submissions of the parties and the observations
of the Court, in the present judgment, would also be based,
particularly, on the factual matrix of the lead case.
1.1. The prayer clauses read as under:-
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"It is, therefore, respectfully prayed that this Hon'ble
Court may be pleased to issue a writ of Mandamus,
Certiorari or any other appropriate writ, order or direction;
and
(i) quash the notice Annexure-1, Assessment order
Annexure-3 and quash the assessment proceedings
conducted by respondent No.4 and the demand of land tax
raised pursuant to these assessment proceedings be also
quashed; and
(ii) consequently a direction may be issued to the
respondents to refund the amount of land tax recovered
from the petitioner after 30.08.1991 in the name of land
tax, with interest @ 24% per annum from the date of
deposit till the date of refund within a given time; or
(iii) in the alternative the respondents may be directed to
issue necessary orders within a given time for adjustment of
the amount of land tax recovered from the petitioner after
30.08.1991 with interest @ 24% against the future
payments of dead rent/royalty in respect of mining lease
held by the petitioner; and
(iv) any other appropriate writ, order or direction which the
circumstances of the case may warrant be also passed; and
(v) the petitioner be awarded the costs of this writ petition."
2. Brief facts of the case, as placed before the Court by
Mr.Vikas Balia, learned Senior Counsel assisted by Mr. D.D.
Thanvi, Mr. Amit Vyas and Mr. Sachin Saraswat, are that the
Rajasthan State Legislature enacted the Rajasthan Land Tax Act,
1985 (hereinafter referred to as 'Act of 1985') imposing tax
pertaining to the lands situated in area(s) other than the urban
area(s) in the State of Rajasthan, which are extensively being put
to use inter alia for the purposes of excavating or extracting ores
or minerals so as to augment the revenue of the State. In this
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regard, the Legislature also framed the Rajasthan Land Tax Rules,
1985 which came into force w.e.f. 01.08.1985.
2.1. The constitutional validity of the Act of 1985 was challenged
before the learned Single Judge of this Hon'ble Court by the
petitioner and others by way of bunch of writ petitions, which
were dismissed; the said judicial determination upon being
challenged before the Division Bench of this Hon'ble Court at
Jaipur Bench, was upheld. Subsequently, the constitutional validity
of the Act of 1985 was challenged before the Hon'ble Apex Court
in the case of Federation of Mining Associations of Rajasthan
v. State of Rajasthan, (Civil Appeal No. 4287 of 1988,
decided on 30.08.1991), wherein the Hon'ble Apex Court held that
the said enactment, insofar as it purports to levy a tax on 'mineral
bearing lands', is ultra vires and void. However, it was observed
that any tax collected under the statute so far need not be
refunded by the State Government, and if any amount of tax
remains to be paid in respect of earlier periods, it will have to be
paid by the assessee(s).
2.2. In pursuance of the aforesaid judgment, the Respondent
No.4-Assessing Authority, issued the demand notices to the
petitioner, demanding the land tax which was due for the period
prior to 30.08.1991. The action of issuance of such notices was
challenged before this Hon'ble Court, which was transferred to the
Rajasthan Taxation Tribunal, and decided vide its majority
judgment dated 06.12.1996; whereby the learned Tribunal
quashed the demand notices so made, and at the same time,
directed the assessing authorities concerned to proceed afresh
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with the assessment of tax after issuing notice(s) under Section 9
of the Act of 1985.
2.3. Resultantly, the respondent No.4 issued the impugned notices
dated 26.04.1997 and 12.05.1997 assuming that the Land Tax is
payable for the period 1986-1987 to 1990-1991 in view of the
judgment rendered in the case of Federation of Mining
Associations of Rajasthan (supra) as well as on the basis of
the records available with the Assessing Authority for the period
upto 29.08.1991. Subsequently, the Assessing Authority finalized
the assessment of land tax and passed the impugned assessment
order dated 30.05.1997.
2.4. Further, the State Government also launched an Amnesty
Scheme dated 20.12.1999 in respect of the recovery of tax and
the petitioner deposited a total amount of Rs.11,98,393/- as land
tax.
2.5. The aforementioned judgment of the Tribunal dated
06.12.1996 was challenged before the Hon'ble Apex Court in the
case of Damodar Pd. Ladha Vs. State of Rajasthan, (Civil
Appeal No. 5066/1997, decided on 30.08.2001) wherein the
Hon'ble Apex Court quashed the Tribunal's judgment dated
06.12.1996 and held that the observations of the Hon'ble Apex
Court made in the judgment Federation of Mining Associations
of Rajasthan (supra) does not empower the State to demand
and collect tax under a void law, but merely casts an obligation on
the assessee(s) in the case(s), wherein the adjudication has
already been made, and the adjudicated amount has not been
paid till 30.08.1991.
[2024:RJ-JD:38774-DB] (11 of 18) [CW-2183/2003]
2.6. In the above backdrop and being aggrieved by the impugned
action on the part of the respondents, the present petitions have
been preferred claiming the afore-quoted reliefs.
3. Learned Senior Counsel for the petitioner submitted that the
State Legislature did not have the competence to legislate upon
the matter relating to levy of a tax on 'mineral bearing land(s)'
based on royalty derived from the same, and therefore, the Act of
1985 enacted by the State Legislature was declared void,
prospectively, by the Hon'ble Apex Court vide its judgment
rendered in the case of Federation of Mining Association of
Rajasthan (supra), thereby restraining the State Government,
for all times to come, from recovering any tax amount, as
provided under the Act of 1985.
3.1. Learned Senior Counsel further submitted that the
interpretation of the expression, "If any amount of tax remains to
be paid in respect of earlier period it will have to be paid by the
assessees" as occurring in the judgment rendered in the case of
Federation of Mining Association of Rajasthan (supra), can
never be construed as an enabling provision for the State so as to
initiate a proceeding for raising the demand of tax, followed by
collection thereof, under a void law; but it merely casts an
obligation on the assessee(s), in case of an already existing
adjudication in regard to payment of such tax.
3.2. Learned Senior Counsel also submitted the imposition of
liability for deposition of tax and assessment made in this
connection after 30.08.1991, followed by proceedings initiated for
recovery thereof under the Amnesty Scheme, is nothing but a
[2024:RJ-JD:38774-DB] (12 of 18) [CW-2183/2003]
mistake of law, on part of the respondents, which in the given
circumstances, is not sustainable in the eyes of law.
3.3. Learned Senior Counsel further submitted that the
assessment of tax qua the period upto 29.08.1991 made by the
Respondent No.4, pursuant to the aforesaid judgment dated
06.12.1996 delivered by the learned Taxation Tribunal, was done
only after the verdict in the case of Damodar Pd. Ladha
(supra), and therefore, such assessment is wholly illegal and
without jurisdiction, in light of the clarification made by the
Hon'ble Supreme Court in the said precedent law.
3.4. In support of such submissions, reliance has been placed on
the following judgments:
a. Kannadasan v. State of Tamil Nadu, 1996 (5) SCC 670;
b. Gurnam Singh v. The State of Rajasthan (S.B. Civil Writ
Petition No. 5462/1997 decided by a Single Bench of this Hon'ble
Court at Jaipur Bench on 18.12.2006);
c. Commissioner of Sales Tax, UP v. Auriaya Chamber of
Commerce, Allahabad, (1986) 3 SCC 50; and
d. Patchala Seethramajah v. Commissioner of Income Tax (Writ
Petition No. 13506/1999, decided by a Division Bench of the
Hon'ble Andhra Pradesh High Court on 08.09.1999);
4. On the other hand, Mr.Mahaveer Bishnoi, learned Additional
Advocate General appearing on behalf of the respondents, while
opposing the aforesaid submissions made on behalf of the
petitioner, submitted that the Hon'ble Apex Court in Federation
of Mining Association of Rajasthan (supra), has only
prospectively invalidated the Act of 1985, and therefore any tax
[2024:RJ-JD:38774-DB] (13 of 18) [CW-2183/2003]
collected under the Statute so far, need not be refunded by the
respondents, and in case any amount of tax remains to be paid in
respect of earlier period, it will have to be paid by the assessee(s).
4.1. Learned counsel further submitted that to understand the
true effect of the subsequent clarificatory judgment of Damodar
Pd. Ladha (supra) wherein it was held that recovery of tax can
take place only in situations where the adjudication has taken
place before the earlier judgment of Federation of Mining
Association of Rajasthan (supra), which was delivered on
30.08.1991. Therefore, in the present case, by virtue of Sections 8
& 9 of the Act of 1985, as soon as the amount of tax becomes
due, it shall be deemed that the adjudication has already taken
place, as a necessary corollary thereof, and in the present case,
the amount of tax so became due, pertained to the period prior to
30.08.1991.
4.2. Learned counsel also submitted that the judgments in the
cases of Federation of Mining Association of Rajasthan
(supra) as well as Damodar Pd. Ladha (supra), though were
rendered by three-Judges Bench of the Hon'ble Apex Court, but in
the given circumstances and the manner in which the same have
been harped upon by the petitioner, do not render any assistance
to the petitioner's claim, in the case at hand. Therefore, the
petitioner, in the light of the aforementioned precedent law is not
entitled to claim the refund of the amount in question.
4.3. In support such submissions, learned AAG relied upon the
judgment rendered by the Hon'ble Apex Court in the case of
[2024:RJ-JD:38774-DB] (14 of 18) [CW-2183/2003]
Mineral Area Development Authority and Anr. Vs. Steel
Authority of India and Anr., 2024 SCC Online SC 1796.
5. Heard learned counsel for the parties as well as perused the
record of the case, alongwith the judgments cited at the Bar.
6. This Court observes that the core of the matter dates back to
the year 1985, wherein the Rajasthan State Legislature enacted
the Act of 1985 imposing tax on the mineral bearing lands
situated in area(s) other than the urban area(s) in the State of
Rajasthan.
7. Thereafter, the determination in regard to constitutional
validity of the Act of 1985 came to be made by the Hon'ble Apex
Court in the case of Federation of Mining Associations of
Rajasthan (supra) wherein it was held that the enactment
insofar as it purports to levy a tax on 'mineral bearing lands' is
ultra vires; relevant portion of the said judgment is reproduced as
hereunder:
"8. Counsel for the respondents has, however, rightly
pointed out that the declaration of invalidity of the levies
should only be prospective and not retrospective. Both in
India Cement [(1990) 1 SCC 12] as well as in Orissa
Cement [1991 Supp (1) SCC 430 : JT 1991 (2) SC 439]
cases, this Court has, for reasons discussed therein,
declared similar legislations invalid only prospectively. In
paragraphs 71 and 72 of the judgment in Orissa Cement
case [1991 Supp (1) SCC 430 : JT 1991 (2) SC 439] , it has
been held that the levy of such tax in a State should be
declared to be unconstitutional only with effect from the
date of the first judgment which declares the legislation to
be invalid and not earlier. In the present case, since the
High Court has upheld the levy and the levy is being
declared unconstitutional only by this order, we direct that
[2024:RJ-JD:38774-DB] (15 of 18) [CW-2183/2003]
our declaration will take effect only from the date of
this judgment. In other words, any tax collected
under the statute so far need not be refunded by the
State Government and if any amount of tax remains
to be paid in respect of earlier periods, it will have to
be paid by the assessee. However, as and from the
date of this judgment, the impugned tax imposed by
the Act in question will not be enforceable."
8. In pursuance of the aforesaid judgment, the Respondent
No.4 i.e., the Assessing Authority, issued the impugned demand
notices to the petitioners, which were challenged and quashed by
learned Rajasthan Taxation Tribunal; following the directions of
the Tribunal, the Assessing Authority (Respondent No. 4) issued
the impugned notices and passed the impugned assessment
order.
9. The aforementioned judgment of the learned Tribunal was
challenged before the Hon'ble Apex Court in the case of Damodar
Pd. Ladha v. State of Rajasthan, Civil Appeal No.
5066/1997, decided on 30.08.2001; the relevant portion of the
said judgment is reproduced as hereunder:
"To us it appears that the expression "if any amount of tax
remains to be paid in respect of earlier period it will have
to be paid by the assessee" can never be construed to be an
enabling provision for the State to initiate a proceeding for making
the demand and collection under a void law, but it merely cast an
obligation on the assessee where there has already been
adjudication, but the adjudicated amount has not been paid
till the date of the judgment in question."
9.1. Thus, from the aforementioned observation of the Hon'ble
Apex Court, it is clear that the tax shall be paid only in those
[2024:RJ-JD:38774-DB] (16 of 18) [CW-2183/2003]
cases where adjudication has already been completed and where
only the adjudicated amount remains to be paid.
10. This Court further observes that in order to understand the
process of adjudication, it is pertinent to refer to Sections 8 & 9 of
the Act of 1985, which are reproduced as follows:
"8. Provisional Assessment - Where a land holder -
(a) fails to file prescribed return; or
(b) fails to deposit the amount of tax for any period; or
(c) files incorrect return; or
(d) evades or avoids the payment of tax for any period;
the Assessing Authority may, after such enquiry as he considers
necessary, proceed to provisionally assess to the best of his
judgment the amount of tax payable by such land-holder for
such period.
9. Assessment - (1) After all the returns relating to a year have
become due, the Assessing Authority shall, with regard to every
land-holder liable to pay tax for such year or part thereof,
proceed to determine the annual value and assess the amount of
tax.
(2) Where the returns filed by a land-holder appear to disclose
the annual value correctly, the Assessing Authority may
determine the annual value and assess the tax accordingly.
(3) The Assessing Authority may, on being satisfied-
(a) that no returns have been filed; or
(b) that returns showing incorrect annual value or the amount of
tax have been filed; or
(c) that there are reasons to make enquiry.
fix a date and require the land-holder to appear before him on
such date and produce books of accounts and other evidence for
assessment of tax.
(4) The Assessing Authority may issue summons to any person
requiring him to appear for being examined or to produce any
document in his possession for assessment of tax with regard to
any land-holder.
(5) After recording the oral evidence, if any, and examining the
books of accounts and other documents produced before him and
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making such enquiry as he considers necessary, the Assessing
Authority may-
(a) determine the annual value and assess the tax as disclosed
by the land-holder; or
(b) refuse to accept the annual value as disclosed by the
landholder and made determination of annual value and
assessment of tax to the best of his judgment."
10.1. This Court, upon a close perusal of Sections 8 & 9 of the Act
of 1985, observes that the same relate to final and provisional
assessments and a closer scrutiny thereof reveals that the
assessment process qua the mining matters is largely a formality.
This is because mining leases come with deeds that specify
important details, including the amount of dead rent and royalty
rates. The lessee concerned must submit returns to the Mining
Authorities, outlining all necessary information to calculate the
annual value as defined in the Act of 1985.
10.2. This Court also observes that the Hon'ble Apex Court in
Federation of Mining Associations of Rajasthan (supra)
while declaring the Act of 1985 as prospectively unconstitutional,
held that only those taxes which were pending from before, can be
recovered, and no tax shall be levied under the Act of 1985, post
30.08.1991; further the tax which has already been levied under
the Act of 1985 shall be not be refundable.
10.2.1. Thereafter, in the judgment of Damodar Pd. Ladha
(supra) the Hon'ble Apex Court clarified the position that only
such tax can be recovered, which were adjudicated upon, prior to
30.08.1991. This Court further observes that in the present case,
upon the accrual of the tax liability, the adjudication also
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automatically took place by virtue of Sections 8 & 9 of the Act of
1985, prior to 30.08.1991, and the State has issued the impugned
notices merely as a part of its modus operandi to recover the tax
amount.
10.2.2. This Court, in light the aforementioned factual matrix and
judgments of the Hon'ble Apex Court, finds that the adjudication,
as a necessary corollary of the provisions of Section 8 & 9 of the
Act of 1985, took place prior to 30.08.1991 and that such tax
amount has been paid by the petitioner in pursuance of the
impugned notices and impugned assessment orders issued by the
respondent no. 4, and therefore, the said amount need not be
refunded, in view of the law laid down in the case of Federation
of Mining Associations of Rajasthan (supra).
11. The judgments cited at the Bar on behalf of the petitioners
also do not render any assistance to their case, as laid herein.
12. In view of the above, this Court does not find it a fit case so
as to grant the relief prayed for by the petitioners in the instant
petitions.
13. Consequently, the present writ petitions are dismissed. All
pending applications stand disposed of.
(MUNNURI LAXMAN),J (DR. PUSHPENDRA SINGH BHATI),J
SKant/-
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