The main legal point established in the judgment is that statutory orders/notification of the Government of the erstwhile State of Bihar continue to be applicable and binding in the successor State of Jharkhand unless repudiated or otherwise modified or superseded by a legislative mandate.

S.N.Jha, J.

1. The dispute in this appeal by the Commissioner and Joint Commissioner (Administration), Commercial Taxes Department, Government of Jharkhand, arising from a writ petition relates to the applicability of Statutory Orders made by the Governor of Bihar In the successor State of Jharkhand upon division of the State under the Bihar Reorganisation Act, 2000 and entitlement of respondent No. 1 to the benefits of sales tax exemption on purchase of raw materials in terms of Statutory Order 478 dated 22.12.1995 of the Commercial Taxes Department.

2. Respondent No. 1 M/s. Swarn Rekha Cokes and Coals Private Limited (hereinafter referred to as the respondent) filed writ petition, CWJC No. 11769/2000 (reported in 2002 (2) PLJR 299), seeking direction upon the respondents, namely, the officials of the Commercial Taxes Department, Government of Jharkhand and Bharat Coking Coal Limited (BCCL) to continue giving benefits of the exemption certificate dated 12.9.1997 granted by the Assistant Commissioner of Commercial Taxes, Madhubani in terms of S.O. 478 dated 22.12.1995 till 20.12.2006 i.e. for the validity period of the said certificate, by way of tax free purchase of the raw materials namely, coal from the BCCL with which the respondent has been granted the linkage. The case of the respondent is that acting pursuant to the Bihar Industrial Policy of 1995 it set up an industrial unit in 1997 for manufacturing special smokeless fuel (Domestic Coke), Coaltar and small size coal in accordance with the technology developed by the Central Mine Planning and Design Institute (CMPDI) after obtaining registration from the Industries Department vide Certificate No. 032302875 dated 17.2.1997 and sales tax registration from the Commercial Taxes Department vide Registration No. M/B 978 (R) dated 8.7.1997. The Industrial Policy of 1995 declared by the State of Bihar provides for various incentives to the new industrial units, one of the incentives being in the shape of sales tax exemption on purchase of raw materials as well as finished goods, vide para 16 of the Policy Resolution. (In this case we are concerned with exemption on purchase of raw materials). In order to carry out the said object, the Government of Bihar issued different statutory orders, one of them being S.O. 478 dated 22.12.1995 with respect to sales tax exemption on purchase of raw materials. The respondent in terms of the said policy and the corresponding statutory order applied for and was granted exemption certificate bearing Certificate No. 01 Exemp. dated 12.9.1997 by the Commercial Taxes Officer, Madhubani, valid for the period from 21.12.1996 to 20.12.2006. As per the said certificate the respondent claimed and was allowed the exemption from sale tax on purchase of coal @ 5000 metric tonnes per month by the BCCL with which it was linked by the CMPDI vide latters letter No. 1506 dated 27.12.1996. The case of the respondent is that in terms of the aforementioned S.O. 478 dated 22.12.1995 and the exemption certificate it is entitled to purchase, tax free, raw materials i.e. coal from the BCCL up to 20.12.2006. However, division of the State of Bihar under the Bihar Re- Organisation Act has cast a cloud of doubt and dispute over its entitlement in the matter of tax free purchase of coal and in the circumstances it moved this Court by filing the writ petition giving rise to this Letters Patent Appeal.

3. The appellants, it may be mentioned, did not file any counter affidavit before the learned Single Judge. In fact, notice does not seem to have been issued to them by the learned Judge (No such grievance was made at the time of hearing of the appeal). The BCCL, however, filed a counter affidavit taking the stand that after bifurcation of the State the exemption granted to the petitioner (read respondent) will not be applicable as BCCL is at Dhanbad which is within Jharkhand State and therefore the old exemption which was applicable in the State of Bihar will not b