M/S. GODREJ SARA LEE LTD.versusASSISTANT COMMISSIONER (AA) & ANR.

                          [2009] 4 S.C.R 1183


                   MIS. GODREJ SARA LEE LT[).                             A
+
                                    v.
             ASSISTANT COMMISSIONER (AA) & ANR.
                  Civil Appeal No. 1888 of 2009
                           MARCH 18, 2009                                 B
     [S.B. SINHA, DR. MUKUNDAKAM SHARMA AND R.M.
                        LODHA, JJ]
    CONSTITUTION OF IND/A, 1950:

           Article 226 - Writ petition by assessee challenging            C
    Notification SRO No. 8212006 issued by State Government of
    Kera/a notifying mosquito repel/ants to be taxable at the rate
    of 12.5% as ultra vires the KVAT Act-High Court declining to
    entertain the writ petition on the ground of alternative remedy
                                                                          0
    by way of appeal - HELD : It is true that the petitoner in its writ
    petitions, has not made a specific prayer that the Notification
    dated 21st January 2006 was ultra vires or otherwise illegal
    but, a specific ground in that behalf was taken- Even otherwise
    the question as to whether the said Notification could have a         E
    retrospective effect or retroactive operation, being a
    jurisdictional fact, should have been determined by the High
    Court in exercise of its wirt jurisdiction under Article 226 as it
    is well know that when an order of a statutory authority is
    questioned on the ground that the same suffers from lack of           F
    jurisdiction, alternative remedy may not be a bar- This is a fit
    case where High Court should have entertained the writ petition
    - Order of High Court is set aside - Petitioner be permitted to
    amend the prayer portion of the writ petition:
         Whirlpool Corporation v. Registrar Trade Marks, Mumbai G
    & Ors. (1998) 8 SCC 1; and Committee of Management &
    Anr v. Vice Chancellor & Ors. 2008(16) SCALE 310 - relied
    on.
                                   1183                                   H
    1184       SUPREME COURT REPORTS                   [2009] 4 S.C.R.


A                        Case Law Reference
           (1998) 8 sec 1            relied on          para 17
           2008(16) SCALE 310        relied on          para 17
B        CIVILAPPELLATE JURISDICTION: Civil Appeal No.1888
    of 2009

         From the Judgement and Order dated 18.12.2007 of the
    High Court of Kerala at Ernakulam in Writ Petition (Civil) No.
    32246 of 2007.
c       Rajiv Tyagi, Chanchal Biswas, Vikas Mishra, for the
    Appellants.

           M.L. Varma, R. Salish, with him for the Respondents.
           The following Order of the Court was delivered
D

           1. Leave granted.

          2. Appellant is manufacturer of coils, mats, aerosols,
    liquids/refills etc. which are used for driving away and destroying
E   mosquitoes. Appellant is an assessee under the Kerala Value
    Added Tax Act, 2003 (for short, 'the Act'). The assessment year
    in question is 2005-06.

          3. The State of Kerala, by Notification being SRO No.82/
F   2006 dated 21st January 2006, notified the list of goods
    specified therein to be taxable at the rate of 12.5%. Item no.66
    of the said Notification reads as under :
    SI.No.         Description of Goods                  HSN Code
    ( 1)                    (2)                             (3)
G
    66          Mosquito repellents. electric or         8516.79.20
                electronic mosquito repellents,
                gadgets and insect repellents,
                devices and parts and accessories
H               thereof.
                M/S. GODREJ SARA LEE LTD. V                     1185
            ASSISTANT COMMISSIONER (AA) & ANR.

         4. According to the appellant, in this case Section 6(1 )(a) A
+
    of the Act would be applicable, the relevant portion whereof
    reads as under:
         "6. Levy of tax on sale or purchase of goods.-(1) Every
         dealer whose total turnover for a year is not less than ten
                                                                      8
         lakhs rupees and every importer or casual trader or agent
         of a non-resident dealer or dealer in jewellery of good,
         silver and platinum group metals or silver articles or
         contractor or any State Government, Central Government
         or Government of any Union Territory or any department
         thereof or any local authority or any autonomous body, C
         whatever be his total turnover for the year, shall be liable
         to pay tax on his sales or purchases of goods as provided
         in this Act The liability to pay tax shall be on the taxable
         turnover,-
                                                                        D
         (a) in the case of goods specified in the Second and Third
         Schedules at the rates specified therein and at all points
         of sale of such goods within the State ............ .
         (c) in the case of transfer of the right to use any goods for
         any purpose whether or not for a specified period, at the E
         rate of four per cent at all points of such transfer.
          5. The Revenue, however, contends that Section 6(1 )(d)
    shall apply. Clause (d) of sub-section (1) of Section 6 reads
    thus:
                                                                        F
         "(d) in the case of goods not falling under clauses (a) or
         (c) at the rate of 12.5% at all points of sale of such goods
         within the State Government may notify a list of goods
         taxable at the rate of 12.5%;"
          6. Our attention has also been drawn to Entry 3808 of G
    Chapter 38 of the Customs Tariff Act based on HSN Code which
    was applicable during the said assessment year; relevant
    portion whereof reads as under :
    "3808     Insecticides, rodenticides, fungicides, herbicides,       H
    1186         SUPREME COURT REPORTS                     [2009] 4 S.C R.


A                anti-sprouting products and plant-growth regulators,
                 disinfectants and similar products, put up in forms or
                 packings for retail sale or as preparations or articles
                 (for example, sulphur-treated bands, wicks and
                 candles, and fly-papers)"
B         7. Indisputably, the Act provides for the Interpretative Rules,
    the relevant portion whereof reads as under :
           "The commodities in the schedules are allotted with Code
           Numbers, which are developed by the International
           Customs Organization as harmonised System of
c          Nomenclature (HSN) and adopted by the Customs Tariff
           Act, 1975. However, there are certain entries in the
           schecfules for which HSN Numbers are not given. Those
           commodities which are given with HSN Number should
           be given the same meaning as given in the Customs Tariff
D          Act, 1975. Those commodities, which are not given with
           HSN Number, should be interpreted, as the case may be,
           in common parlance or commercial parlance. While
           interpreting a commodity, if any inconsistency is observed
           between the meaning of a commodity without HSN
E          Number and the meaning of a commodity with HSN
           Number. the commodity should be interpreted by including
           it In that entry which is having the HSN Number.
           HSN Numbers are allotted in the Schedules either in four
           digits or in six digits or in eight digits. The four digit numbers
F          indicate the heading in the HSN classification, six digit
           numbers indicate the sub-heading and the eight digit
           numbers indicate the specific commodity number. While
           interpreting the commodities in the Schedules, the
           following guidelines may be followed.
G          I.
           II.
           Ill. The commodities which are given eight digit HSN
           Number shall mean that commodity which bears that HSN
H          Number."
             M/S. GODREJ SARA LEE LTD. V.                     1187
         ASSISTANT COMMISSIONER (AA) & ANR

     8. However, so far as the Revenue is concerned, it relies       A
on clause IV thereof which reads as under :
     "IV. As an exception to the above rules, there are certain
     entries in the Schedules, which bear eight digit numbers
     but the four digit heading numbers of such commodities          B
     are given for some other commodities mentioned
     elsewhere. In such cases, the four digit heading shall
     include only those commodities under that heading
     excluding that commodity for which the eight digi~ numbers
     are given. Similar cases are available in the case of six
     digit numbers also. In such cases the above principle shall     C
     apply mutatis mutandis."

        9. The appellant contends that if the said entry viz., 3808
of the Customs Tariff Act is read with Entry 66 of the Notification,
it will be evident that the same is distinct and different from the
item which is at serial no.66 of the Notification being HSN Code D
8516. 79.20.
      10. However, the contention of the Revenue, on the other
hand, is that as the language employed in the Notification itself
is clear and unambiguous, it is not necessary to refer to the E
HSN at all.

      11. Appellant was assessed for the said assessment year
for which value added tax at the rate of 12.5% was levied on the
products of the appellant in terms of the Notification dated 21st
January 2006.                                                        F
     12. It filed a writ petition, inter alia, contending :
     "K. If SRO No.82/2006 seeks to amend and enhance the
     rate of Tax on Pesticides and Insecticides from 4% to
     12.5%, it is ultra-vires the provisions of KVAT Act and void G
     and illegal. This is so, because by virtue of 6(1 )(d), the
     Entry and rate of tax under Schedule-I & Ill cannot be
     altered."
    13. The reliefs prayed for in the said writ petition are as
under:                                                               H
    1188         SUPREME COURT REPORTS                     [2009) 4 S.C.R


A          ''i) To issue a writ of Certiorari or other appropriate writ.
           order or direction to call for records leading to Ext.P11
           final Assessment Order for 2005-06 under the KVAT Act
           and quash the same:
           ii) To issue a Writ of Mandamus or any other appropriate
B
           Writ. order or direction, directing the respondents to refrain
           from enforcing the Assessment Order Ext.P11 and demand
           pursuant thereto against the petitioner. pending disposal
           of the writ petition;
c          iii) To declare that the sales turnover of products falling
           within the description Insecticides and Pesticides which
           are manufactured under licence under the Insecticides
           Act and falling within the description of Entry 44(5) of Ill
           Schedule of KVAT Act is liable to be taxed only at 4% and
0          levy of tax at 12 .5% is illegal and unauthorised.
           iv) To stay the operation of Ext.P11 final Assessment Order
           for the Assessment Year 2005-06, pending disposal of
           the W.P.(C);
           And
E
           v) To grant such other and further reliefs as this Hon'ble
           Court may deem fit and proper in the facts and
           circumstances of the case, including the cost of this
           proceeding to the petitioner."
F
         14. By reason of the impugned judgment, the High Court,
    however, refused to entertain the said writ petition opining that
    the appellant has alternative remedies available to it as an
    appeal against the order of assessment was maintainable.

G         15. Mr. Tyagi the learned counsel appearing on behalf of
    the appellant would submit that the High Court committed a
    serious error 1n refusing to entertain the writ petition as the validity
    of the Notification was in question which could not have been
    determined by the Revenue authorities.
H          16. Mr. Varma. the learned senior counsel appearing on
                   MIS. GODREJ SARA LEE LTD. V                      1189
               ASSISTANT COMMISSIONER (AA) & ANR.

     behalf of the respondents, on the other hand, would support the A
     impugned judgment, inter alia, contending that the appellant did
     not pray for a declaration that the said Notification dated 21st
     January 2006 was invalid in law or otherwise could not have
     been given a retrospective effect
                                                                            B
            17. It is true that the appellant, in its writ petition, has not
     made a specific prayer that the said Notification dated 21st
     January 2006 was ultra vires or otherwise illegal but, as
     indicated hereinbefore, a specific ground in that behalf had been
     taken in respect thereof. Even otherwise, in our opinion, the
     question as to whether the said Notification could have a C
     retrospective effect or retro-active operation being a
     jurisdictional fact, should have been determined by the High
     Court in exercise of its writ jurisdiction under Article 226 of the
     Constitution of India as it is well known that when an order of a
     statutory authority is questioned on the ground that the same D
     suffers from lack of jurisdiction, alternative remedy may not be
     a bar. [See: Whirlpool Corporation v. Registrar Trade Marks,
     Mumbai & Ors. (1998) 8 SCC 1] and Committee of Management
     & Anr. v. Vice Chancellor & Ors. 2008(16) SCALE 310].
                                                                             E
            18. For the reasons aforementioned, we are of the opinion
     that it is a fit case where the High Court should have entertained
     the writ petition. The impugned order is set aside accordingly
     and the appeal is allowed.
           19. The appellant may be permitted to amend the prayer           F
     portion of the writ petition.
          20. We, however, make it clear that we have not gone into
     the merit of the matter and all the contentions of the parties,
     both on facts and in law, shall remain open.
11
     R.P.                                              Appeal allowed.