JUDGMENT Prakash Krishna, J.
1. This case has a checkered history. Assessment year 1965-66 is involved in the present revision. The revision is directed against the order dated 23-5-1995 passed by the Trade Tax Tribunal Kanpur in Second appeal No. 438 of 1983.
2. The applicant had purchased oil seed from the registered dealer situate in the State of U.P. and all purchases were made from registered dealer. It produced the list of entire purchases giving the name, address and registration number of the selling dealer. It appears that successive assessment orders were passed on account of remand order passed by the higher authority. Ultimately last remand order was passed by the Deputy Commissioner (Appeals) in Appeal No. 76 of 1978 decided on 19-6-1981 with certain direction. The crux of the direction given by the Dy. Commissioner (Appeals) was that the claim of exemption set up by the applicant on the ground that the oil seeds were purchased from the registered dealer, should be examined afresh after examining the files of the selling dealer. The oil seed was taxable at the time of first purchase under Section 3-D of U.P. Trade Tax Act in the relevant assessment year. The assessing authority after remand has noted the direction given by the first appellate authority in its order. According to the applicant it has made purchases from 20 registered dealers and their name, addresses and the amount of purchase are mentioned in the assessment order. The assessing authority finding that out of 20 dealers, the files of only seven selling dealers could be available. The remaining files were either lost or were weeded out and in absence of the files, no further inquiry was possible. Ultimately, the assessing authority again levied purchase tax on the purchase of oil- seeds treating the applicant as first purchaser. He partly accepted the claim of the dealer in respect of Rs. 8094.87, Rs. 7609.60 and Rs. 10212.24 out of the total claim of Rs. 1080925.44. The said order was confirmed by the Deputy Commissioner (appeals) as well as by the Trade Tax Tribunal.
3. Heard Sri M.M. Rai, learned counsel for the applicant and Sri B.K. Pandey, learned Standing Counsel for the department. Learned counsel for the applicant pointed out that the Tribunal was not correct in treating the applicant as the first purchaser of the oil-seeds. The Tribunal has wrongly rejected the claim on the ground that the applicant has neither produced any prescribed form against the alleged purchases nor has proved beyond doubt that the alleged purchases have been made from the registered dealer. In contra the learned Standing counsel supported the order of the Tribunal.
4. Learned counsel for the applicant submitted that by insertion of Rule 12-B for the first time with effect from 4-03-1974, the prescribed form has been introduced for claiming exemption in the case of purchase tax for the purchase made from the registered dealer. Prior to the aforesaid date there was no prescribed form either under the Act or under the Rules framed therein. This proposition cannot be disputed by the learned Standing Counsel. The relevant assessment year involved is 1965-66. In this situation the observation of the Tribunal that the appellant has not produced any prescribed form against the alleged purchases, cannot be sustained. But that is not end of the matter, in as much as the Tribunal has recorded further finding that the applicant has failed to discharge the burden of proof that it made purchases form the registered dealers registered with the department.
5. Learned counsel for the applicant submitted that the dealer has given a list of selling dealers their addresses along with their registration numbers with the Sales Tax Department. Thus the applicant has discharged the initial burden. It may be noted here that in the assessment order itself the assessing authority has mentioned the names, and addresses of the selling dealer of the applicant. The applicant dealer has also furnished the registration numbers of its selling dealers as is apparent from the order of the Tribunal. Before the Tribunal the departmental representative argued that on inquiry conducted by the assessing authority some of the dealers were not trace able due to lapse of time. Purchases of oil-seeds amounting to Rs. 10,55,009/- were made by the applicant from the registered dealer.
6. This Court in the case of Chhittar mal Ram Dayal v. Commissioner of Trade Tax, reported in 1981 UPTC 18 has traced the history of Section 3-D which was introduced for the first time in U.P. Sales Tax Act, 1958. The first levy however, was made in 1964 when this section was amended by U.P. IInd Amendment Act 22 of 1962. It provides for the levy of tax of first purchase made by the dealer or through the dealer acting as purchasing agent. The explanation-1 to this Section reads as under:
"In the case of a purchase made by a registered dealer through the agency of a licensed dealer, the registered dealer shall be deemed to be the first purchaser, and in every other case of a first purchase, made through the agency of a dealer, the dealer who is the agent shall be deemed to be the first purchaser."
There was in nature of exception to Sub-section (1) levying purchase tax. It permitted a registered dealer to claim exemption on purchase made form a registered dealer. Sub-rule (d) of Rule 44-A which provided for determination of turn over of purchase read as under:
"all amounts for which goods are purchased by one registered dealer form another registered dealer, provided tax under Section 3D has already been paid on such goods; and...."
7. It was further held that Explanation- 1 which has been introduced with retrospective effect since 1964 will not operate to the period beyond 1971 for the reasons that existence of operation of Explanation- 1 the period beyond 1971 will make it unworkable. It cannot operate to Section 3D as it stood prior to 1971. The retrospectivity of the Act, therefore, has to be read only up to the year 1971. Further in Para 6 of the report it has been held therein that the assessee was not required to prove that the oil seeds which it purchased form the registered dealer were tax paid. If the purchases were made from registered dealer, the assessee was not liable to pay any tax thereof. The aforesaid judgment fully supports the contention of the learned counsel for the applicant. In the case in hand the applicant has given even registration number of its selling dealers. None of the authorities have found that either registration number given are fake or no such dealer was registered at such registration number at the relevant point of time. In this situation the applicant has discharged its initial burden of proof and it was upon the department to establish otherwise. At this stage the argument of learned Standing counsel is to be considered. He strenuously contended that the assessment order was passed in the light of observation and direction given by the first appellate authority. The first appellate authority had restricted the power of the assessing authority by certain directions enumerated in the assessment order to the following effect:
(1) The claim of exemption in respect of purchases should be rejected after examining the files of the selling dealer.
(2) In no case there should be double taxation.
(3) In case of doubt, the benefit of doubt should be given to the department.
(4) Whether the selling dealer has deposited the purchase tax treating it as purchase tax, the exemption should be granted only on the finding the clear proof of payment of purchase tax.
(5) The burden to prove exemption on the purchases shall be no the dealer applicant.
(6) Where the assessment file of the selling dealer are not trace able, in such cases it shall be presumed that the applicant has failed to establish its claim of exemption on such purchases and such purchases shall be taxable.
8. Elaborating the argument learned Standing counsel submitted that the order of remand with the aforesaid direction given by the first appellate authority having attained finality the assessing authority did not commit any mistake in levying the purchase tax accordingly. The extent of power of the assessing authority, as a consequence of the order of remand passed by the first appellate authority under Section 9 of the Act has been examined by a Full Bench of this Court in the case of Ram Dayal Hari Vilas v. Commissioner of Trade Tax 1979 UPTC 999 and it has been held that the scope and ambit of the power of the assessing authority to deal with the case of remand depends upon the power conferred upon him by the Statute. If the Statute itself empowers the assessing authority to do on remand something which the appellate authority, would not be bad. The consequences of setting aside of the assessment order by the first appellate authority and sending the case back to him for making fresh assessment is that original assessment proceeding are revived and the assessing authority has to make assessment afresh in the ambit and scope of Section-7 of the Act. Ultimately in Para 24, the Full Bench answered the question referred to it in the following manner.
"Where an order of assessment is set aside by the Appellate Authority which remands the case to the assessing authority with certain directions for making a fresh assessment, the assessing authority has subject to carrying out such direction, the same power as it originally had in making the assessment under Section 7 of U.P. Sales Tax Act. But where the order of assessment is set aside by a revisional authority under Section 10 of the Sales Tax Act, the jurisdiction of the Sales Tax Officer to make the assessment can be circumscribed by the specific directions given by the Revising authority, the jurisdiction of the Sales Tax Officer to make the assessment has been limited, the Sales Tax Officer will have the jurisdiction to make the assessment only to extent to which he has been permitted to do so under the orders of the Revising authority."
9. Then the learned Standing counsel placed reliance upon the judgment of this Court in CST v. Abdul Gani Banney Miyan reported in 2000 Vol (1) UPTC 303. In this case it was held by this Court that earlier decisions rendered by this Court is final and binding on the sales tax authorities, notwithstanding the fact that subsequently a Division Bench of this Court has taken a different view. The decision rendered by the learned Single Judge shall not loose its precedent value. This ruling is distinguishable on facts as well as on law and had not application on the present fast situation. The directions given by the first appellate authority was binding but it cannot be said that the said direction even if it is contrary to the law, is binding on the Tribunal or on the High Court.
10. There is another aspect of the matter. The remand orders are interlocutory orders. Any order or direction or finding given in the remand order is binding on authorities subordinate to it. But the same is not binding to the higher authorities or higher court, as held by Hon. Apex Court.
11. The Apex Court in the of Jasraj Inder Singh v. Hemraj Multan Chand reported in (1977) 2 SCC 154 has held that in an appeal against the High Court's finding Supreme Court is not bound by what High Court might have held in its remand order. It is true that a subordinate Court is bound by the direction of the High Court. It is equally true that the same High Court, hearing the matter on a second occasion or any other court of coordinate authority hearing the matter on a second occasion or any other court of coordinate authority hearing the matter cannot discard the earlier holding, but a finding in a remand order cannot bind a higher Court when it hears the matter in appeal.
12. In Preetam Singh v. Assistant Director of Consolidation and Ors. reported in 1996 AWC 553 the Supreme Court has followed it s earlier judgment given in the case of Jasraj Inder Singh (supra) and has held that even if the remand order of the settlement officer has not been specifically put to challenge in a separate and independent proceeding, the Court of Assistant Director of Consolidation, a higher court could examine the finding recorded by the Settlement Officer. In Collector of Central Excise, Indore v. Hindustan Liver Limited, reported in J.T. 2000 (8) SC 445, the Apex Court has quoted observation form the judgment of Jasraj Inder Singh (supra) and has held that so far as Supreme Court is concerned it is not bound by the finding of the Tribunal rendered in the first instance while remanding the case to the lower authorities because the Supreme Court was now hearing the appeal against the order of the Tribunal in which earlier order has merged.
13. In any view of the matter certain directions namely 3, 4 and 6 in the said remand order being contrary to law as laid down by this Court in the case Chhitermal Ram Dayal 1981 UPTC 81 are liable to be ignored.
14. Strong reliance was placed by the learned Standing Counsel on Ram Chandra Shiv Shanker v. Commissioner of Sales Tax 1976 U.P.T.C. 375. In this case the dealer had made the purchases form Regional Food Controller, U.P. and claimed exemption under Section 3D it was found that Regional Food Controller U.P. was not registered as dealer in U.P. and in that fact situation the claim of the dealer was not accepted. This authority therefore, is distinguishable on facts, as in the present case the purchases claimed to have been made from registered dealer.
15. The up shot of the above discussion is that the applicant has fully discharged its burden to prove that the purchase of oil seeds were made by it from the registered dealers registered with the department. The department has failed to establish that the applicant has not made purchases from the registered dealers. Thus purchases of oil- seeds worth Rs. 1055009/- were not liable purchase tax at the hands of the applicant. The observation of the Tribunal that it is not the business of the department to inquire about these facts, is wholly perverse and unwarranted.
16. In the result the revision succeeds and is allowed. The assessment order as confirmed by the Tribunal refusing to grant exemption of tax on the purchase of oil seed amounting to Rs. 1055009/- is set aside. It is held that the applicant was not first purchaser of the aforesaid purchases of oil seeds and is, therefore, not liable to pay purchase tax thereon.
The revision is allowed. There will be no order as to costs.