JUDGMENT
Motilal B. Naik, J.
1. In all these writ petitions, the controversy is with regard to the view taken by a two Members Bench of the Tribunal in Satyanamyana Raw and Boiled Rice Mitt v. State of A.P. (STAT), 34 APSTJ 153, on the question of determining the tax component on the sale of rice.
2. Learned Counsel representing the petitioners stated that in order to work out sales tax component on the sale cost of rice, a formula is provided under Section 8A(1) of the Central Sales Tax Act (for short ‘the Act’) which is identical to Rule 6(1) of the A.P. General Sales Tax Rules. Learned Counsel also stated on earlier occasion, the validity of the formula as provided under the Act fell for consideration before this Court and this Court upheld the same.
3. A Three Member Bench of the A.P. Sales Tax Tribunal followed the view taken by this Court and rendered a decision in Badrinadh Rice Mill and Anr. v. State of A.P. (STAT), 29 APSTJ 181. Since then, the department was following the decision of the Three Member Bench of the Sales Tax Tribunal and deciding the sales tax component on the sale cost of rice. However, the Two Member Bench of the Tribunal took a contra view in Satyanarayana’s case (supra). Basing on the Two Member Bench decision, the Commissioner, Commercial Tax Department issued a circular to all concerned to revise the assessment made by the original authority and, further, required the assessing authority to decide the tax component on the sale cost of rice as per the ratio laid down in Satyanarayana’s case (supra). On the basis of the circular instructions issued by the Commissioner, Commercial Tax Department, the concerned Deputy Commissioners have revised the assessments while exercising jurisdiction under Section 20 of the A.P. General Sales Tax Act and further all the assessing authorities are deciding the tax liability as per the circular instructions issued by the Commissioner, Commercial Tax Department. Learned Counsel also stated as long as the law laid down by the Three Member Bench of the Tribunal in Badrinadh’s case (supra) holds the field, which is binding on all the authorities in the State of Andhra Pradesh, the ratio laid down by the Two Member Bench in Satyanarayana’s case (supra) could not have been followed by the Commercial Tax Department. The revisions or assessments made pursuant to the circular instructions issued by the Commissioner, Commercial Tax Department, based on Two Member Bench decision, cannot be sustained.
4. We have heard the learned Government Pleader appearing on behalf of the respondents.
5. It is settled law when there are few decisions on a principle, the law laid down by a Larger Bench shall prevail over others as long as the ratio laid down by the Three Member Bench is not upset by other Larger Bench. Admittedly, the Three Member Bench rendered a decision following the decision of this Court and, as such, the controversy with regard to the sales tax component on the sale cost of rice had been settled as per the formula provided under Section 8A (1) of the Act. However, the later decision of the Two Member Bench created confusion, which has led to issuance of circular instructions by the Commissioner, Commercial Tax Department. It is noticed that the decision of the Three Member Bench in Badrinadh’s case cited (supra) was not placed before the Two Member Bench, which was deciding Satyanarayana’s case (supra) though the controversy was set at naught by the Three Member bench in Badrinadh’s case (supra). When the matter was taken up by the Two Member Bench, neither there was any representation on behalf of the petitioners nor the Tribunal had the advantage of going through the ratio laid down by the Three Member Bench on similar question, which led to confusion in deciding the sales tax portion on the sale cost of rice.
6. As discussed by us, in view of the settled law, the ratio laid down by the Larger Bench would prevail over the ratio laid down by smaller benches as long as the ratio laid down by the Larger Bench is not upset by any subsequent decisions of the Larger Benches, we declare the view taken by the Two Member Bench in Satyanarayana’s case (supra) is not a good law. Since we have declared that law laid down by the Two Member Bench in the decision cited in Badrinadh Rice Mill and Anr. v. State of A.P, (supra) is not a good law, the circular instructions issued by the Commissioner, Commercial Tax Department based on Satyanarayana’s case (supra), which has led to either revising the assessments made earlier and assessments made thereafter, cannot be held to be valid assessments and as such, we set aside the assessments or re-assessments made.
7. The writ petitions are allowed. The respondents shall take consequential steps. No costs.