The State cannot discriminate against a person or a group of persons on the ground of their geographical location in the matter of granting exemption from taxation.

S. Ali Ahmed, J.

1. M/s Pratap Pur Sugar and Industries Ltd is the petitioner in these two cases, which have been heard together and are being disposed of by this common judgment.

2. The petitioner-factory, which is located in the State of Uttar Pradesh is engaged in crushing sugarcane. Admittedly the sugarcane being supplied to the petitioner in Uttar Pradesh is not sufficient to meet its requirement. It, therefore, applied for allotment of reserve-area in the State of bihar. That was allotted to it. The crushing season, according to the bihar Sugarcane (Regulation of Supply and Purchase) Act, 1981 (hereinafter to be referred t- as the Act) commences on 1st day of July and ends on 30th June nex following. In the year 1981-82. there was excess production of sugarcane in the State of Bihar The officer, therefore, issued instruction that on account of non-lifting of sugarcane by some mills specified in the order, the cane in the area reserved for those mills could not be crushed the petitioner-factory was, therefore, directed to crush the can of thearea reserved for other factories also. As a result of this order, which is binding under sub-section (9) of Sec.13 of the Act, the petitioner had no option but to crush the sugarcane of the area that was reserved for other factories there were some other factories also which had to do exessessive crushing on account of high production of sugarcane and non-lifting of the same by some factories in the State. Those factories were given exemption with effect rom 1st May, 1982 under Sec.49 (2) of the Act from payment of purchase tax which is payable under Sec.49 (1) of the Act. The petitioner was not included m the list of factories which have been given this exemption the grievance is, that the petitioner has been discriminated in the matter of exemption under Sec.49 (2) of the Act The prayer, the refore in C W j. C.4121/87 is to direct the respondents to give exemption to the petitioner also. So far as C W. J C. No.4120 of 1987 is concerned, the facts are almost identical, excepting that a relates to the crushing season.1982-83 and annexure-1 dated 20-11-1985 while giving exemption to some other factories states that sugar factories of Uttar Pradesh shall not get the remission under this notification. The prayer, therefore, is to quash that part of Annexure 1 by which the factories located m the State of Uttar Pradesh have been excluded from the exemption granted under Sec.49 (2) of the Act.

3. Counter-affidavits have been filed in the two cases. The facts which i have mentioned above, have not been denied but the order excluding the petitioner from getting exemption under Sec.49 (2) of the Act has been sought to be justified on the ground that the petitioner-factory is located not in the State of Bihar but is situated in Uttar Pradesh It is said that the remission is given to the factories located in Bihar with a view to give encouragement to local factories.

4. Mr. Basudeo Prasad appearing in support of the application contended that Sec.49 (1) of the Act provides that the State Government may by notification m the official Gazette impose tax on purchase of sugar-cane by or on behalf of occupier of the factory. He says that under sub section (2)the purchase, tax may be reduced, remitted, in whole or in part" in respect ot can used m any sui;h tactoiy for the purpose of research seed-distribution, crushing of diseased cane or intake of excessive crop. He says that these are the only four grounds which are relevant for exercise of powers under this sub-section. According to Mr. Basudeo Prasad the fact that the petitions-factory is located in the State of Uttar Pradesh is irrelevant for the purpose of Sec.49 (1) as well as Sect on 49 (2) of the Act. Mr. Additional Advocate General No.1, while supporting the order contended that the Act makes a distinction between factories located within Bihar located beyond the limits of Bihar cannot claim to be treated alike with the factories