RUHUL ISLAM, J.-This appeal by special leave arises from a decision of the High Court Division on an application under section 17(2) of the dales Tax Act, 1951 raising the question as to whether the assessee is entitled to claim adjustment on refund of the sales tax paid by him at the stage of importation of raw materials against the tax payable on the finished products.
2. The appellant is a manufacturer of wig soap, and since 1-7-1966 is a licensed manufacturer. The assessee filed sales tax return showing consolidated turnover at Rs. 14,52,455 for the four quarters ending on 30June, 1967. The Sales Tax Officer, however, determined the assessee'18-A turnover at .Rs. 14,60,935 and assessed tax thereon at Rs. 72,622. Facts in shorr are that the assessee imported certain raw materials such as tallow, cocoanut oil, caustic soda prior to 1-7-1966, that is, before the assessee became licensed manufacturer, and paid sales tax on the importation of these raw materials amounting to Rs. 96,170. The assessee contended that on the relevant. Date there was an opening stock of those imported raw materials which were consumed during the accounting period and the assessee claimed credit of Rs. 54,433 being the amount paid as sales tax on the raw materials Consumed, against the sales tax liability of the period under assessment. The assessee claimed adjustment of the amount already paid as sales tax against the liability for the four quarters ending on 30-6-67, reason being that sales tax could not be imposed twice in respect of the same time. The Sales Tax Officer did not accept the contention of the assessee and the claim for credit for Tk. 54,433 was disallowed. However, the assessee was allowed credit of Rs. 18,189 already paid by the assessee. The appeal preferred by the assessee was dismissed by theth Appellate Assistant Commissioner of Income-tax. The assessee being unsuccessful before the Appellate Assistant Commissioner of Income-tax and then before the Income-tax Appellate Tribunal, filed an application under section 17(1) of the Sales Tax Act before the income-tax Appellate Tribunal and prayed for referring the question framed therein to, the. High Court Division.
The Tribunal by its order dated 21-4-1972 rejected the application on the ground that no question of law arose out of the Tribunal. Thereafter the assessee filed an application under section 17(2) of the Sales Tax Act before the High Court Division framing four questions which had been framed in the application under section 17(1) of the Sales Tax Act. The High Court Division however, took up for decision only one question, namely, "whether the assessee could claim adjustment or refund of sales tax paid by the assessee at the stage of importation against the sales tax payable on the finished products". The High Court Division also did not find any merit in the contention of the thereafter and by the order dated June 24, 1980 rejected the application. Thereafter the assessee moved this Court and leave was granted to examine the contention whether upon a true construction of sections 4(b) arid 27(1) of the Sales Tax Act the assessee was entitled to claim adjustment or refund of sales tax paid at the stage of importation of the raw materials against the sales tax payable on the finished products. Section 27(1) of the Sales Tax Act reads as under:-- "17.-(1) Where partly manufactured goods are purchased by a licensed manufacturer and tax has been paid on those goods on importation or any previous sale, a refund of the amount of the tax so paid shall be made to the licensed manufacture.-."
Section 4(b) of the Sales Tax Act reads as under:- "4. Notwithstanding anything contained in section 3, the tax shall not be payable on--
(b) goods imported by a licensed manufacturer if the good are partly-manufactured goods."
3. Mr. M. Hasan appearing for the appellant strenuously argued that washing soap was exempted from sales tax under Notification No. S. R. O. 475 (E)/65 dated 14-6-1965, and the exemption continued till 30-9-1966, but sales tax at the rate of 5 % was imposed on washing soap with effect from 1-7-1966 vide Notification No. S. R. O. 114(R)/66, dated July 1, 1966. He submitted that the assessee tightly claimed that on the raw materials consumed in the manufacturing of washing soap sates tax at the standard rate having been already paid at the Custom-, stage, the end products are Habit to be exempted from payment of sales tax, and the assessee is entitled to get credit of the amount already paid as sales-tax, against the outstanding sales tax liability. Mr. Hassan argued that unless adjustment as prayed for is given, this will amount to double taxation.
He further submitted that the raw materials in question being partly manufactured goods within the meaning of section 2(12) of the Sales Tax Act, a component part of washing soap, which is subject to sales tax, the sales tax paid on the partly manufactured goods, is refundable, and the assessee is entitled to the credit of the sales tax paid on the partly manufactured goods.
4. It is admitted that the appellant was not a licensed manufactures at the time of importation of the raw materials. Section 4(b) provides for exemption in the cases of imports by licensed manufacturers. According to Mr. Hassan the assessee being a licensed manufacturer during the period under assessm ent and the partly manufactured goods having been consumed in the manufacturing of washing soap, the assessee should be treated as entitled to the benefit of the exemption provided under section 4(b). In support of his submissions Mr. Hassan also referred to section 27(1). In view of clear language of section 4(b) and section 27(1) of the Sales Tax Act the argument cannot be accepted. The learned Judges of the High Court Division were correct in taking the view that the import of raw materials for using in the manufacture of washing soap must be by a licensed manufacturer. Section 4(b) speaks about goods imported by a lied manufacturer.
Similarly section 17(1) speaks about purchase at partly manufactured goods by a licensed manufacturer. On examining sections 4(b) and 27(1) of the Sales Tax Act I have not the least doubt that the exemption as contemplated in section 4(b) and the remedy as provided in section 27(1) are not available to the assessee because he was not a "licensed manufacturer when partly manufactured goods were imported. Washing soap was made free under the Notification No. S. R.
O. 475(E)/65, dated 14-6-1965 anti the exemption continued till 30-6-1966 and sales tax at the rate of 5 --% was imposed on washing soap under Notification No. S. R. O. 114(R)/66, dated 1-7-1967, with effect from 1-7-1966. In the absence of any provision either in the Notification or any change in the existing law, that is, the charge section and the exemption provided section 4(b) of the Act, the Sales Tax Officer has not got the authority to grant the relief to the assessee. Only because washing soap was included as one of the taxable, items subsequently, that coil: not make the importer of the raw materials of washing soap entitled to claim adjustment of the sales tax paid on the raw materials against his sales tax liability on the manufactured products, that is the end products. It may cause some hardship, but in the face of the clear language of the statutory provisions, the contention of the assessee cannot be accepted. In my opinion the question has been correctly decided by the High Court Division.
Therefore, the appeal is dismissed with costs.