1. This is a petition under Article 226 of the Constitution by a company known as the Webbing and Belting Factory Limited of Delhi challenging certain actions of the respondents, the Sales Tax Officer Ward No. 5 and the Commissioner of Sales Tax of Delhi State, under the Bengal Finance (Sales-tax) Act of 1941 as extended to the State of Delhi.
2. It appears that the petitioner company has two factories, one at Delhi where wicks, tapes, 'niwars' etc., are manufactured, and one at Ghaziabad where the manufacture of handloom textiles is carried on. The firm is registered as a dealer under the Act and according to the certificate of registration it was permitted to purchase free of tax certain kind of goods for resale and certain goods including yarn, chemicals, colours and dyes for purposes of manufacture. This privilege was granted under the provisions of Section 5(2)(a)(ii) which allows to be deducted from the taxable turnover of the dealer his turnover on sales to a registered dealer of goods of the class or classes Specified in the certificate of registration of such dealer as being intended for resale, by him, or for use by him in the manufacture of goods for sale.
3. Early in 1953 certain alterations were made by the Sales Tax Officer in the petitioner's registration certificate regarding the goods which could be purchased free of tax for purposes of manufacture, and a revision petition was filed by the firm before the Commissioner of Sales Tax under the provisions of Section 20 of the Act with the result that on 3-9-1953 an order was passed to the effect that the orders of the Assistant Commissioner dated 2-2-1953 and the Sales Tax Officer dated 17-2-1953 had been can-Celled and the Sales Tax Officer was directed to examine the matter and allow the purchase of all raw materials being intended for use in the manufacture of goods for sale in the State of Delhi. In March 1954, however, the Sales Tax Officer sent a letter (Annexure 'B') to the firm requesting submission of its registration certificate for deletion of items, of raw materials purchased by it for the purpose of manufacture of cloth at Ghaziabad.
It is evident from the letter that the Sales Tax Officer interpreted the provisions of Section 5(2)(a)(ii) as meaning that exemption could only be given with regard to materials purchased for the purpose of manufacturing within the State of Delhi, whereas the manufacture of cloth by the firm was being carried on at Ghaziabad, which is in U.P. On receipt of this letter the firm sent the letter, Annexure E' to the Commissioner of Sales Tax for clarification of his order dated 3rd of September, it being submitted that the correct interpretation of that order was that the raw materials could be purchased free of tax for the manufacture of cloth for sale in the State of Delhi and not merely for the actual manufacturing within the State.
To this a reply was sent on behalf of the Commissioner of Sales Tax to the effect that his order was quite clear and needed no further elucidation. On this the present petition was filed in this Court on 13-5-1954.
4. The preliminary objection has been raised on behalf of the respondents that the writ petition should not be entertained since the petitioner firm has not exhausted its remedies under Section s 20 and 21 of the Act. Apart from the provisions in Sub-sections (1) and (2) of Section 20 for appeals against assessments, Sub-section (3) provides for revision of all kinds of orders passed under the Act in these words:
'(3) Subject to such rules as may be prescribed and for reasons to be recorded in writing, the Commissioner upon application or of his own motion may revise any assessment made or order passed under this Act or the rules thereunder by a person appointed under Section 3 to assist him, and subject as aforesaid, the Chief Commissioner may, in like manner, revise any order passed by the Commissioner.'
Section 21 goes even further and makes specific provision for referring any question of law, which most certainly would include a question of the kind involved in the present dispute, to the High Court. The provisions of this section are to all intents and purposes identical with those of Section 66, Income-Tax Act, since within sixty days from the passing of an order under Sub-section (3) of Section 20 by the Chief Commissioner affecting any liability of any dealer to pay tax under the Act the dealer may apply to the Chief Commissioner to refer any question of law arising cut of the order to the High Court, and if the Chief Commissioner refuses to do so under Sub-section (2) thedealer may apply to the High Court which may require the Chief Commissioner to state and to refer the case.
5. In many cases where an Act of this kind provides machinery of this kind this Court has held that it will not entertain a writ petition filed by a person who has not exhausted his remedies under the Act It may be, as was argued by the learned counsel for the petitioner, that a writ petition provides a more speedy and more efficacious remedy than the machinery provided by the Act in the sense that when any appeal, or perhaps revision, is filed under the Act it is necessary for the dealer in the meantime to pay the tax which is a subject of the dispute, but in my opinion for this Court to entertain writ petitions raising questions of law and the interpretation of the Act would make Section 21 wholly redundant, and I personally cannot see that the machinery furnished by the Act is not in any way ineffective or unfair.
6. A very similar point arose- in the case --Bharam Chand Kishore Chand Puri & Brothers v. Excise and Taxation Commissioner, Jullundur', AIR 1953 Punj 27 (A), which concerned the East Punjab General Sales Tax Act, 1948, This Act contains provisions for revision by the Commissioner and then by the Financial Commissioner, and contains a similar provision about reference of points of law to the High Court by the Financial Commissioner. In view of these provisions Kapur J. and I declined to interfere under Article 226, holding that the petitioner in that case should take the matter to the Financial Commissioner and, if so advised, apply for a case to be stated to this Court. In the circumstances I dismiss the present petition with costs. Counsel's fee Rs. 100/-.