High Court of Himachal Pradesh Shimla Cwp No · 2007

company, the writ petition is pre-mature and not maintainable. It - 4 - has also been pointed out that the respondents are entitled to collect the cess levied on tractors as per Automobile Cess Rules. It is further contended by the respondents that the exemption only applies to the excise duty and not to the cess payable under the IDRA or Education cess leviable under the Finance Act. There is no manner of doubt that under the IDRA, a cess has been imposed upon the tractors. The question which first arises is whether tractors fall within the definition of automobile and therefore, can the cess be recovered under the Automobile Cess Rules, 1984 or not? The first Schedule to the IDRA classifies different goods under different headings. Headings 7 and 10 of the First Schedule are relevant and read as follows:- (cid:147) 7. Transportation (1) (2) (3) (4) (5) Aircraft Ships and other vessels drawn by power Railway locomotives Railway rolling stock Automobiles (motor cars, buses, cycles, scooters sand the like) trucks, motor (6) Bicycles (7) Others, such as fork lift trucks and the like

10. Agricultural Machinery (1) (2) Tractors, harvesters and the like Agricultural implements.(cid:148) Under rule 2(b) of the Automobile Cess Rules (cid:145)automobile(cid:146) has been defined as under:- (b) (cid:145)Automobile(cid:146) means motor cars, buses, trucks, jeep type vehicles, vans, scooters, motorcycles, mopeds, and all other - 5 - automobiles covered under the sub-heading (5) of Heading 7 (cid:145)Transportation(cid:146) of the First Schedule to the Act;(cid:148) It is clear from a reading of the aforesaid provisions that the intention of the legislature was to treat tractors differently and by virtue of definition clause, tractors cannot be said to be falling within the definition of automobile in the Automobile Cess Rules. Heading 7 of the first Schedule of the IDRA, deals with (cid:145)Transportation(cid:146). Various types of transport vehicles are mentioned but tractors are not included in heading 7. Tractors have been specifically included in heading 10 relating to (cid:145)Agricultural Machinery(cid:146). The contention of the respondents that following the definition of (cid:145)Motor Vehicle(cid:146) in the Motor Vehicles Act, 1988 and the general meaning of the term automobile, a tractor is also a motor vehicle and should be treated as such, cannot be accepted. The Parliament in its wisdom has intentionally treated tractors differently from other automobiles. Tractors have not been included in heading 7 nor are they impliedly or explicitly included in the definition of automobile in the Automobile Cess Rules which also specifically makes mention of heading 7. We are, therefore, of the opinion that the cess leviable on tractors cannot be recovered under the Automobile Cess Rules. Though there is no manner of doubt that cess has been levied on tractors, the respondents have failed to point out to us that any machinery has been prescribed under law for recovery of the cess. Therefore, we have no other option but to hold that the cess leviable on tractors cannot be recovered till the rules are - 6 - framed or executive instructions are issued for recovery and collection of the cess. In view of the fact that we have held that there is no machinery provided for collection of recovery of cess, we over- rule the preliminary objection raised by the respondents that the petition is pre mature. Since there is no machinery provided, the petitioner has no forum to ventilate his grievance. Therefore, this court has jurisdiction to entertain this petition. However, we are not in agreement with the petitioner that since tractors are exempt from payment of excise duty, no cess can be levied. The exemption notification has to be construed strictly in accordance with the terms of the notification. Tractors admittedly are goods on which excise duty/ additional excise duty can be levied. However, the State in its wisdom thought it fit to exempt tractors from payment of excise duty. However, this exemption cannot be extended to the payment of cess provided under the IDRA. No notification has been brought to our notice whereby there is exemption given from payment of the cess payable under the IDRA. In fact as pointed out above, the Ministry of Industry (Department of Heavy Industry) has specifically levied cess on tractors. As far as the notification regarding exemption of industries from excise duty in Uttranchal and Himachal Pradesh concerned, the said notification specifically states that the industries shall be exempt from the payment of whole of the duty of excise or additional duty of excise leviable under the Acts mentioned in the notification. The said notification only makes - 7 - mention of the Central Excise Act, 1944, Additional Duties of Excise (Goods of Special Importance) Act, 1957 and the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978. This notification makes no reference to the IDRA or the Finance Act. Therefore, we are of the view that the petitioner is liable to pay the cess on tractors as well as education cess. The contention of the petitioner that the Education cess is levied @ 2% of the aggregate of the duties and since the petitioner has been exempted from paying excise duty , this 2% cess cannot be calculated, is not tenable. The excise duty can always be calculated even if it is not collected and on this notional calculation, the education cess can be calculated. This cess has to be collected in terms of the Finance Act. In view of the above discussion, we reject the contention of the petitioner that it is not liable to pay the cess leviable under the IDRA or the Education Cess levied under the Finance Act, 2004. However, in both the cases, cess can only be recovered from the petitioner as per law and cannot be recovered under the Automobile Cess Rules. The writ petition is disposed of in the aforesaid terms. No costs. ( Deepak Gupta ), J July 16, 2007. s. ( Surinder Singh ), J. - 8 - IN THE HIGH COURT OF HIMACHAL PRADESH SHIMLA. CWP No. 895 of 2005 Judgment reserved on 18.6.2007. Date of Decision: July___, 2007 M/s Indo Farm Tractors & Motors Ltd. (cid:133)Petitioner. Versus. Union of India & ors. (cid:133)Respondents Judgment for consideration, please. ( Deepak Gupta ), J. I agree/ do not agree. ( Surinder Singh ), J. List the writ petition for pronouncement of judgment on _______July 2007. ( Deepak Gupta ), J. Court Secretary. - 9 -