ORDER (Per: HONOURABLE THE CHIEF JUSTICE) This petition under Article 226 of the Constitution is filed by the Indian Oil Corporation Ltd, a Government of India Undertaking, (hereinafter referred to as “the Corporation”) to challenge the order dated 3rd November 2011 made by the Dy. Commissioner of Commercial Taxes, Patna in exercise of power conferred by Section 77 of the Bihar Value Added Tax Act, 2005 (hereinafter referred to as “the 2005 Act”) on the application for determination made by the Corporation; and to challenge the order dated 3rd November 2011 of the Dy. Commissioner of Commercial Taxes, Patna made under Section 25(2) of the 2005 Act and the action in demanding recovery of Rs. 5,37,71,074.00 of Value Added Tax (hereinafter referred to as “VAT”) for the Financial Year 2011-12. 2. The facts are not disputed and the matter at issue lies in a narrow compass. The Corporation imports High Speed Diesel Oil (hereinafter referred to as “the Diesel”) from Haldia in West Bengal to the State of Bihar. The stock is sold either to the other Oil Marketing Companies like Bharat Petroleum Ltd. or to the retail suppliers. It is not in dispute that the Diesel imported by the Corporation from the State of West Bengal attracts levy of Entry tax under Section 3 of the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale Therein Act, 1993 (hereinafter referred to as “the 1993 Act”). In August 2011, the Corporation had imported a large stock of the Diesel in Bihar from Haldia in West Bengal. It is not in dispute that the said import attracted levy of the Entry tax under the 1993 Act; and that the Corporation did pay the Entry tax in the sum of Rs. 25,52,52,674/-. More than half of the stock of the Diesel imported by the Corporation was sold to the retail suppliers. Some of it was sold to different Oil Marketing Companies and the rest remained unsold. It is not in dispute that the Corporation incurred liability to pay VAT on the sale of the Diesel to the retail suppliers. 3. It is also not in dispute that the Diesel sold to the Oil Marketing Companies was not exigible to VAT as envisaged by Notification dated 4th May 2006 issued by the Government of Bihar in exercise of power conferred by Section 13(2)(a) of the 2005 Act. 3. It is also not in dispute that the Diesel sold to the Oil Marketing Companies was not exigible to VAT as envisaged by Notification dated 4th May 2006 issued by the Government of Bihar in exercise of power conferred by Section 13(2)(a) of the 2005 Act. The Corporation accordingly did not pay VAT on the sale of the Diesel to the Oil Marketing Companies. It is also not in dispute that the amount of Entry tax paid on import of the Diesel is liable to be adjusted against the VAT paid on the sale of the Diesel. The Corporation availed of the said facility of set off and adjusted the entire amount of Entry tax paid by it on the aforesaid import of Diesel against the VAT payable on sale of the Diesel to the retail suppliers. 4. It is this adjustment availed of by the Corporation which is the subject matter of dispute. According to the Dy. Commissioner of Commercial Taxes, Patna, the adjustment of the Entry tax paid is available only in respect of the stock exigible to VAT. In other words, the Entry tax paid on that part of the stock of the Diesel, which was sold to the retail suppliers on which the Corporation had incurred liability to pay VAT alone could be adjusted against the said liability of VAT. 5. What the Corporation did was to adjust the entire amount of the Entry tax paid under the 1993 Act or to adjust the amount of Entry tax paid on the import of the entire stock of the Diesel against the VAT payable on sale of part of the stock made to the retail suppliers. 6. The respondent authorities have not accepted the aforesaid adjustment made by the Corporation and has, under the impugned order dated 3rd November 2011, raised the demand of the arrears of VAT to the extent of Rs. 5,37,71,074/-. The application for determination made under Section 77 of the 2005 Act has also been decided against the Corporation. According to the said determination, the adjustment of Entry tax is available only in case of sale of the Diesel which attracts VAT under the 2005 Act. The stock sold to the Oil Marketing Companies did not attract VAT under the 2005 Act. The Entry tax paid on such stock cannot be adjusted. 7. Learned counsel Mr. According to the said determination, the adjustment of Entry tax is available only in case of sale of the Diesel which attracts VAT under the 2005 Act. The stock sold to the Oil Marketing Companies did not attract VAT under the 2005 Act. The Entry tax paid on such stock cannot be adjusted. 7. Learned counsel Mr. Bharat Ji Agarwal has appeared for the petitioner. Mr. Agarwal has taken us through Section 3 of the 1993 Act and the Government Notification dated 4th May 2006 issued under Section 13(2)(a) of the 2005 Act. He has vehemently submitted that the amount of Entry tax paid on the entire stock of the Diesel is liable to be adjusted against the VAT payable on the sale of the Diesel or any part thereof. He has further submitted that in the event of two possible views, the one which favours the tax payer, the dealer, should be adopted. He has also submitted that the matter calls for a close scrutiny by the High Court and may not be dismissed on the ground of alternative statutory remedy available under the 2005 Act. 8. In support of his submissions, Mr. Agarwal has relied upon the judgments of the Hon’ble Supreme Court in the matters of M/s Filterco & Anr. Vs. Commissioner of Sales Tax, Madhya Pradesh & Anr. [ (1986) 2 SCC 103 ]; Bihar State Electricity Board & Anr. Vs. Usha Martin Industries & Anr. [ (1997) 5 SCC 289 ]; Associated Cement Companies Ltd. Vs. State of Bihar & Ors. [ (2004) 7 SCC 642 ]; State of H.P. & Ors. Vs. Gujarat Ambuja Cement Ltd. & Anr. [ (2005) 6 SCC 499 ] & of Mauri Yeast India Private Ltd. Vs. State of Uttar Pradesh & Anr. [ (2008) 5 SCC 680 ]. 9. Learned Principal Additional Advocate General Mr. Lalit Kishore has appeared for the respondent authorities. He has contested the Writ Petition. At the outset, he has submitted that the petitioner has an alternative statutory remedy of appeal under Section 73 of the 2005 Act. In view of the statutory remedy available to the Corporation, the petition under Article 226 of the Constitution need not be entertained. 10. Mr. Lalit Kishore has further submitted that the language of Section 3 of the 1993 Act is clear and unambiguous. In view of the statutory remedy available to the Corporation, the petition under Article 226 of the Constitution need not be entertained. 10. Mr. Lalit Kishore has further submitted that the language of Section 3 of the 1993 Act is clear and unambiguous. The second proviso to Section 3(2) of the 1993 Act provides for set off of the amount of the Entry tax paid upon the imported goods which are exigible to VAT under the 2005 Act. In the submission of Mr. Lalit Kishore, the set off or the adjustment can be availed of only in cases where the dealer has incurred liability to pay VAT. Indisputably, the Corporation had not incurred liability of VAT under the 2005 Act on the Diesel sold to the Oil Marketing Companies. He has submitted that since the Diesel sold to the Oil Marketing Companies is not exigible to VAT, the question of adjustment of the Entry tax against VAT does not arise. In the submission of Mr. Lalit Kishore, the petition requires to be dismissed outright. 11. There cannot be a dispute and there is none that the Corporation is not required to pay VAT on the sale of the Diesel to the Oil Marketing Companies. The second proviso to sub-section(2) of Section 3 of the 1993 Act clearly postulates that the VAT payable on the goods at the rate specified under Section 14 of the 2005 Act will be reduced to the extent the amount of Entry tax paid by the dealer on such goods. It reads as under. “Provided further that where an importer of Scheduled goods liable to pay tax under the Act, incurs tax liability, at the rate specified under Section 14 of the Bihar Value Added Tax Act, 2005 (Act 27 of 2005), by virtue of sale of imported Scheduled goods or sale of goods manufactured by consuming such imported Scheduled goods, his tax liability under the Bihar Value Added Tax Act, 2005 (Act 27 of 2005) shall stand reduced to the extent of tax paid under the Act.” 12. The above referred proviso provides for the reduction in the liability of VAT to the extent of the amount of Entry tax paid if the dealer satisfies certain conditions; inter alia, (i) The goods must be the scheduled goods; [The scheduled goods are enlisted in Schedule IV to the 2005 Act. The above referred proviso provides for the reduction in the liability of VAT to the extent of the amount of Entry tax paid if the dealer satisfies certain conditions; inter alia, (i) The goods must be the scheduled goods; [The scheduled goods are enlisted in Schedule IV to the 2005 Act. High Speed Diesel Oil is one of such scheduled goods]; (ii) The scheduled goods is imported from outside Bihar for consumption, use or sale in the State of Bihar; (iii) The dealer has paid Entry tax on import of the scheduled goods under the 1993 Act; (iv) The sale of the scheduled goods so imported has incurred liability of Value Added Tax under the 2005 Act. 13. The above referred second proviso to sub-section (2) of Section 3 of the 1993 Act expressly provides for set off. Set off of the amount of the Entry tax paid on the imported goods against the tax liability on such imported goods under the 2005 Act. The phrases “incurs tax liability” and “by virtue of sale of imported scheduled goods” give away the legislative intent. 14. In our opinion, there is no possibility of two opinions with respect to the aforesaid proviso. We agree with Mr. Lalit Kishore that the amount of Entry tax paid on the import of scheduled goods can be adjusted only against the VAT payable on the sale of such goods. 15. In the present case, admittedly the Corporation sold some 9360.79 kilolitres of the Diesel to the Oil Marketing Companies. The said sale did not attract VAT under the 2005 Act. The question of reducing the amount of VAT by the amount of Entry tax paid on import would not arise. The Corporation did not incur liability to pay VAT on the said sale. The Corporation is, therefore, not entitled to adjust the amount of Entry tax paid on the said quantity of the Diesel. 16. In the matter of Associated Cement Companies Ltd. (supra), a somewhat similar question arose for consideration by the Hon’ble Supreme Court. In the said matter, under the then prevailing industrial policy of the Government of Bihar, the cement company was exempted from payment of sales tax on sale of cement as an incentive to establish a new industry or to expand the capacity of the existing industry. In the said matter, under the then prevailing industrial policy of the Government of Bihar, the cement company was exempted from payment of sales tax on sale of cement as an incentive to establish a new industry or to expand the capacity of the existing industry. The Cement Company increased its manufacturing capacity and was allowed exemption on increased production capacity. The Cement Company did avail of the said exemption in respect of sale of increased production of cement and also claimed that the sales tax payable on sale of cement (the additional production) be reduced by the amount of the Entry tax paid under then prevalent Ordinance of 1993 (now the 1993 Act). The claim was rejected by the concerned authorities on the premise that the benefit of set off cannot be availed of in respect of the sale for which the sales tax was not paid. The Hon’ble Supreme Court held that the set off under the above referred second proviso to Section 3(2) of the 1993 Act would be available on sale of the goods which were exigible to the sales tax. Unless the additional production of cement were exigible to the sales tax, it could not have been exempted from payment of the sales tax. The sale of cement being exigible to the sales tax, the cement company was entitled to the set off provided in the aforesaid second proviso. 17. The matter before us is slightly different. It is not the case that the Corporation is exempted from payment of VAT on sale of the Diesel to the Oil Marketing Companies. Section 13 of the 2005 Act provides for the points in a series of sales in the State of Bihar at which a dealer would be liable to pay VAT. Sub-section (2) thereof empowers the State Government to determine the point in respect of the series of sales of the specified goods at which the VAT shall be levied. It is not in dispute that the High Speed Diesel Oil is the specified goods. In exercise of the aforesaid power conferred by Section 13(2)(a) of the 2005 Act, the Government of Bihar has issued the above referred Notification dated 4th May 2006 to determine the point in a series of sales at which the VAT would be payable. It is not in dispute that the High Speed Diesel Oil is the specified goods. In exercise of the aforesaid power conferred by Section 13(2)(a) of the 2005 Act, the Government of Bihar has issued the above referred Notification dated 4th May 2006 to determine the point in a series of sales at which the VAT would be payable. Under the said Notification, the VAT becomes payable on the sale of the High Speed Diesel Oil to the retail vendors or the consumers. The Oil Marketing Companies not being the retail vendors or the consumers, sale of the High Speed Diesel Oil to the Oil Marketing Companies is not exigible to VAT. Thus, we are dealing with an article, the incidence of sale of which does not attract liability to pay VAT. 18. In our opinion, the respondents are right in not allowing the Corporation the benefit of set off under the aforesaid second proviso to Section 3(2) of the 1993 Act in respect of sale of the Diesel to the Oil Marketing Companies on the premise that Corporation did not incur liability to pay VAT on such sale. The petition is devoid of any merit. 19. For the aforesaid reasons, the petition is dismissed. 20. We clarify that we have not examined any other issue that may arise in respect of the impugned recovery and the notice of demand. Any such dispute may be raised in statutory appeal under the 2005 Act. Ashwani Kumar Singh, J. – I agree