N.N. Mathur, J.
1. By two separate writ petitions under Articles 226 and 227 of the Constitution of India, the State of Rajasthan seeks direction to quash the common judgment dated July 24, 1998 passed by the Rajasthan Taxation Tribunal and to restore the order dated June 18, 1997 passed by the assessing authority.
2. It would be trite to notice the facts in D.B. Civil Writ Petition No. 2280 of 1999. The respondent-company is engaged in manufacturing solvent extracted oil having its plant and industry at Kesarpura, Sheoganj. The company is registered under the provisions of the Rajasthan Sales Tax Act, 1994 (hereinafter referred to as 'the RST Act') and the Central Sales Tax Act, 1956 (hereinafter referred to as 'the CST Act'). The State of Rajasthan with a view to promote edible oil industries issued a notification dated December 26, 1986 in exercise of powers under Section 8(5) of the CST Act extending the benefit to certain categories of the industries in the form of concessional rate of tax on the sale of edible oil. In order to promote solvent extracted oil industries the State Government on June 27, 1990 issued a notification under Section 4(2) of the RST Act giving relief to certain categories of industries in the form of concessional rate of tax on the sale of edible oil manufactured by the process of solvent extraction. The concessional rate of tax was 1.5 per cent. Apart from this, the State Government also promulgated a new Sales Tax Incentive Scheme, 1989 with a view to give similar other benefits to the industries. On the recommendation of District Level Screening Committee, the Commercial Taxes Officer, Special Circle, Pali, granted eligibility certificate dated December 8, 1992. Thus, the respondent-company was allowed the benefit of incentive to the extent of 75 per cent of its tax liability to a maximum limit of Rs. 2,36,967. For the assessment year 1993-94, on the basis of inter-State sale to the tune of Rs. 35,39,047.84, the assessment was finalised by the order of the regular assessing authority dated June 28, 1995.
3. The Commercial Taxes Officer, Anti-evasion, Jaipur, conducted a survey of the business premises of the respondent-company on April 24, 1997. The said authority issued a notice dated May 17, 1997 under Section 12 of the RST Act calling upon the assessee-company to show cause as to why the assessment made be not reopened. The respondent-company sought time for filing reply which was granted. Another notice dated May 31, 1997 under Section 12 of the RST Act was issued to show cause as to why the reassessment proceedings may not be initiated. The company again sought time by way of sending a telegram. The assessing authority passed an ex parte reassessment order on June 18, 1997 raising a demand of Rs. 4,07,607.
4. The order of the assessing authority was challenged before the Rajasthan Taxation Tribunal on the ground of violation of principles of natural justice. On merits, it was submitted that the case of the company falls within the four corners of the notification dated June 27, 1990 which exempts it from the tax. It was argued on behalf of the assessee-company that term 'edible oil' includes solvent extracted edible oil which is the product of the company and since tax at the rate of 1.5 per cent as specified in the notification has already been paid, therefore, the authority had no jurisdiction to pass the reassessment order. It was also contended that no reassessment proceeding could be initiated under Section 12 of the RST Act for the reason that there was nothing which was concealed before the regular assessing authority which framed the regular assessment order dated June 28, 1995. The revenue raised a preliminary objection with respect to the maintainability of the appeal before the appellate authority under Section 84 of the RST Act. On merit, it was specifically denied that solvent extracted oil sold by the assessee-company was edible oil so as to make it entitled to claim the benefit of concessional rate of tax in view of, the notification dated June 27, 1990. It was also submitted that solvent extracted oil is not edible oil and hence it is exigible to tax at the rate of 3 per cent and not at the rate of 1.5 per cent as alleged in the application. It was also argued that at the time of sale of the product, it has been specified by the respondent-company itself in the bill that the solvent extracted oil was 'not for direct human consumption'. It was also denied that no defect was pointed out with respect to evasion of tax in the survey report. Since notice issued for reassessment under Section 12 of the Act was well within the jurisdiction of the competent authority and since in response to the notice the petitioner did not choose to appear before the authority and sought adjournment for one pretext or other to avoid participation in the reassessment proceedings. Thus, according to the respondent-company, the competent authority has rightly passed the ex parte reassessment order.
In the another appeal reference has been made to the notification dated December 26, 1986 issued by the State Government under Section 8(5} of the CST Act in place of notification dated June 27, 1990.
5. The Tribunal held that solvent extracted edible oil falls within the category of all kinds of edible oils in terms of notification dated June 27, 1990. The Tribunal also held that the notification is very wide in its amplitude and takes within its protective umbrella all kinds of oils which can be described or treated or regarded as edible oils. Thus, in the opinion of the Tribunal, solvent extracted oil is also an edible oil. It was also held that it may not be fit for direct human consumption, but after its being subjected to the process of decolourising, deodourising and exclusion of fatty acids therefrom, it becomes fit for human consumption. Consequently, the original application preferred by the respondent-company has been allowed by the Tribunal and the assessment order dated June 18, 1997 has been set aside.
6. It is submitted by Mr. Sangeet Lodha, learned counsel for the department, that Tribunal has proceeded with the assumption that goods manufactured by the respondent-unit is solvent extracted edible oil, whereas, admittedly the oil manufactured by the respondent-unit is the solvent extracted oil 'not for direct human consumption'. It is further submitted that the Tribunal had committed error in holding that the term 'edible oil' within the meaning of notification dated June 27, 1990 includes solvent extracted edible oil which is the product of the respondent-company. Learned counsel has also criticised the observation of the Tribunal that notification is very wide in its amplitude and takes within its protective umbrella all kinds of oils which can be described or treated or regarded as edible oils.
7. On the other hand, it is submitted by Mr. Dinesh Mehta, learned counsel appearing for the respondent-company that the seal 'not for direct human consumption' put on the bill is to meet the requirement of the Control Order, 1977. The oil manufactured or sold by the respondent-company is required to be refined which includes the process of deodourisation, decolourisation and removing of fatty acids. The oil which is extracted from edible oil seeds is edible even without refining. The learned counsel has placed reliance on (i) decision of the Punjab and Haryana High Court in Milkhi Ram Oil & Dall Mills v. State of Punjab reported in [1992] 84 STC 206, (ii) decision of the Allahabad High Court in Chandausi Oil Mills v. Sales Tax Commissioner, U.P. reported in [1961] 12 STC 310 and (iii) decision of the apex Court in Champaklal H. Thakkar v. State of Gujarat reported in AIR 1980 SC 1889. It is also submitted by the learned counsel that in absence of the definition of edible oil in the Act, the meaning given to the expression under the various other statutory provisions should be adopted. He has referred to the provisions of Section 3 of the Essential Commodities Act, 1955, wherein edible oil has been defined under Section 2(g) which reads as follows :
''Edible oil' means oil used, directly or after processing, for human consumption and includes hydrogenated vegetable oil.'
8. In Milkhi Ram Oil and Dall Mills' case [1992] 84 STC 206 (P&H;), there was an admitted position that oil manufactured by the petitioner was admittedly used for human consumption. There was no material on record to show that he did not confirm the instructions issued by the Government.
9. In Champaklal H. Thakkar's case AIR 1980 SC 1889, the court observed that neutralisation, bleaching and deodourisation are merely refining processes so that the colour, the odour and foreign substances are removed from it before it is hydrogenated. In this case also there was no dispute that the company is not called by any of the items enumerated in Part I of the Schedule to the Act except item No. 5. In fact, there was no controversy as is involved in the instant case. Thus, this case has no application to the facts of the present case. Similarly, the Allahabad High Court's decision does not advance the case of the respondent-company. In the said case, the question involved was whether linseed oil being an article fit for food or not.
10. In the instant case, the product which was being sold by the respondent-company admittedly bears the label 'not for direct human consumption'. Therefore, on their own saying, the oil manufactured cannot be said to be for human consumption or an edible oil. The oil manufactured by the respondent-company after being subjected to decolourising, deodourising and exclusion of fatty acids therefrom it becomes fit for human consumption does not make the unit to claim the benefit under the notification dated June 27, 1990, inasmuch as, the incidence of tax on sale and the entitlement of the unit has to be examined as on the date of the sale is made. Admittedly, while effecting the sale of the oil sold by the respondent-company it was not edible and, therefore, even if the oil manufactured after being subjected to certain process it becomes edible oil it will not make entitlement to claim the benefit of concessional rate of tax on sale under notification dated June 27, 1990. Therefore, the Rajasthan Tax Tribunal was not justified in disturbing the order of the assessing authority.
11. The respondent-company has raised other contentions with respect to the ex parte order without giving opportunity of being heard. It is also submitted that the C.T.O., Anti Evasion, had no jurisdiction in the matter of dispute with respect to the rate of tax. In our view, both the contentions are not sustainable. It appears from the record that in spite of the opportunity given, the respondent-company did not put in appearance before the assessing authority. Be that as it may, the matter has been examined at length by the Rajasthan Taxation Tribunal on merits of the case. Thus, no prejudice has been caused to the appellant. The contention is rejected.
12. Consequently, both the writ petitions are allowed. The judgment of the Rajasthan Taxation Tribunal dated July 24, 1998 is set aside. The order of the assessing authority dated June 18, 1997 is restored. No order as to costs.