The amendment to Section 8(5) of the CST Act applies prospectively and does not retroactively affect vested rights to tax exemption granted prior to the amendment.

Order :

(Sanjay K. Agrawal, J.)

1. Common question of law and fact is involved in both the writ petitions, therefore, they have been clubbed together, heard together and are being decided by this common order.

2. Petitioner M/s. Jayaswal Neco Industries Limited, in both the writ petitions, has called in question legality, validity and correctness of notification No.F-10/101/2006/CT/V/(94) dated 31-10-2006 (Annexure P-2) issued by the State of Chhattisgarh in exercise of the powers conferred by Section 15-B & 72(i)(b) of the Chhattisgarh Value Added Tax Act, 2005 (for short, 'the Chhattisgarh VAT Act') read with sub-section (5) of Section 8 of the Central Sales Tax Act, 1956 (for short, 'the CST Act') incorporating the amended provisions of Section 8(5) of the CST Act, branding the same as unconstitutional and invalid in law. Petitioner M/s. Jayaswal Neco Industries Limited in WPT No.122/2016 has also sought for quashment of the assessment order dated 18-6-2010 (Annexure P-3) issued for the assessment year 2006-2007, as with respect to other assessment orders, appeals are already filed.

3. It is the case of the petitioner that the petitioner is a Company engaged in the business of manufacture and sale of iron and steel products and was registered with the Commercial Tax Department. The petitioner Company was exempted from payment of taxes including Central Sales Tax under the notification dated 3-6-1993 from 22-9-1996 till 21-9-2010, however, the benefit of exemption was later extended till 21-9-2019, however, on coming into force of the GST (Goods and Services Tax) with effect from 1-7-2017, it would be applicable to the Company up to 30-6-2017. It is the further case of the petitioner that sub-section (5) of Section 8 of the CST Act was amended on 10-5-2002 with effect from 11-5-2002 mandating the assessee to fulfill the requirement of Section 8(4) of the CST Act and consequently, after the amendment, the assessee was required to furnish declaration in Form C to avail the benefit of exemption. Consequently, the State Government issued notification dated 31-10-2006 incorporating the requirement as mentioned in the amended provisions contained in Section 8(5) of the CST Act in exercise of the powers conferred by Section 15-B & 72(i)(b) of the Chhattisgarh VAT Act read with sub-section (5) of Section 8 of the CST Act. The petitioner was denied the benefit of exemption in absence of Form C for the relevant assessment year and assessment order was passed by the Assessing Officer which was unsuccessfully assailed in first appeal and thereafter in second appeal leading to filing of the instant writ petitions questioning the constitutional validity of notification No.F-10/101/2006/CT/V/(94) dated 31-10- 2006 (Annexure P-2) and the consequent order dated 26-11-2016 (Annexure P-4 in WPT No.93/2017) passed by the Chhattisgarh Commercial Tax Tribunal, Raipur in Case No.A/65/15/2016/Central. It is also the case of the petitioner that the petitioner Company was granted the benefit of exemption by notification dated 3-6-1993 in the year 1996 for a period of 14 years and the benefit of exemption so granted was the vested right as on 1996 which has been extended up to 21-9-2019 and vested right cannot be taken away from the petitioner Company by issuing subsequent notification with retrospective effect. It is also the case of petitioner that the notification would not apply to the petitioner Company so far as the tax exemption and acting on the concession granted by the State Government, the petitioner Company has made huge investment of more than Rs.1,000 crores and thus entitled for exemption applicable up to 21-9-2019, but upon coming into force of the GST, it would be applicable up to 30-6-2017, which cannot be taken away on the principle of promissory estoppel and which has been sought to be quashed.

4. Return has been filed by the State / respondents stating inter alia that though the benefit of exemption from payment of taxes including Cent