The Government shall speak only in one voice. It has only one policy: SC
THIS is a not so strange case where one department of the Government gave a concession which another department sought to deny on hyper technical grounds.
The Government of Himachal Pradesh had as a part of Industrial Policy allowed a concessional rate of 1% of Central Sales Tax till 31.03.2009. The State Cabinet met on 20.05.2009 and approved extension of the concession till 31.03.2013. Accordingly the Principal Secretary (Industry) issued a notification that the the Governor, Himachal Pradesh is pleased to extend the incentive of validity of concessional rate of CST @ 1% upto 31.03.2013 or till the time CST is phased out, whichever is earlier.
Thereafter, the Excise and Taxation Department of the State Government issued statutory Notification allowing the tax at the rate of 1% of the taxable turnover of such goods with immediate effect for the period ending 31.03.2013. This Notification was issued on 18.06.2009. So, technically there was no concessional tax during the period from 01.04.2009 to 17.06.2009.
The State had the audacity to argue that since the notification under the Act providing for tax concession was issued only on 18.06.2009 wherein it was specifically mentioned that the notification would have immediate effect and would operate for the period ending on 31.03.2013, the assessee is not entitled to the CST concession @ 1% for the intervening period between 01.04.2009 to 18.06.2009.
The Supreme Court yesterday held:
1. The State Government cannot speak in two voice.
2. Once the Cabinet takes a policy decision to extend its 2004 Industrial Policy in the matter of CST concession to the eligible units beyond 31.03.2009, upto 31.03.2013, and the Notification dated 29.05.2009, accordingly, having been issued by the Department concerned, viz., Department of Industries, thereafter, the Excise and Taxation Department cannot take a different stand.
3. What is given by the right hand cannot be taken by the left hand.
4. The Government shall speak only in one voice. It has only one policy. The departments are to implement the Government policy and not their own policy.
5. Once the Council of Ministers has taken a decision to extend the 2004 Industrial Policy and extend tax concession beyond 31.03.2009, merely because the Excise and Taxation Department took some time to issue the notification, it cannot be held that the eligible units are not entitled to the concession till the Department issued the notification.
6. The State Government cannot levy the tax against its own policy.
7. The State Government is bound by the policy decision taken by the Council of Ministers and duly notified by the Department concerned, viz., Department of Industries.