Hon'ble DR. KOTHARI, J.— The present Sales Tax Revision Petition has been filed by the assessee-appellant against the judgment dated 7.6.2010 of the learned Rajasthan Tax Board, Ajmer passed in Tax Appeal No. 13/2008/Udaipur by which order, the learned Tax Board has reversed the order dated 30.6.2007 of the learned Deputy Commissioner (Appeals), Udaipur and affirmed the order dated 19.1.2007 passed by the Assessing Authority holding the assessee liable for payment of tax to the tune of Rs. 3,40,868/-. 2. The controversy in hand is about allowing of the input tax credit of the tax suffered on the raw material lying in opening as on 1.4.2006 stock as per Section 19 of the Rajasthan Value Added Tax Act, 2003 (`the Act of 2003') which was enforced in the State of Rajasthan w.e.f. 1.4.2006.The input tax credit is allowable of the tax paid on the raw-materials and other goods used for production of the finished goods by the assessee against the tax payable on the sale of finished goods by him. 3. Section 19 of the VAT Act substituted by Act No. 4 in the year 2006 w.e.f. 1.4.2006 reads as under. "19. Input tax credit for stock on the date of commencement of this Act.- Input tax credit shall be allowed on the goods other than capital goods, which had suffered tax under the repealed Act, and are lying in stock of the dealer on the date of commencement of this Act, provided that such dealer has submitted the details of such stock, as required by the Commissioner under Section 39 of the repealed Act or Section 19 of this Act, and such goods in stock are used for the purpose specified in clause (a) to (f) of sub-section (1) of Section 18. However, the input tax credit under this section shall be allowed to the extent of the tax paid under the repealed Act or the amount of tax payable on such goods under this Act, whichever is less." 4. The learned Assessing Authority, however, replying upon a Circular issued by the Head of the Department namely, the Commissioner of Commercial Taxes, on 1st July, 2006 refused the input tax credit to the assessee vide the Assessment Order dated 19.1.2007 (Annex. 1). The learned Assessing Authority, however, replying upon a Circular issued by the Head of the Department namely, the Commissioner of Commercial Taxes, on 1st July, 2006 refused the input tax credit to the assessee vide the Assessment Order dated 19.1.2007 (Annex. 1). The relevant clause (8) of the said Circular dated 1.7.2006 issued by the Commissioner of Commercial Taxes, as relied upon by the Assessing Authority, is quoted herein below for ready reference:- ^^dj uhfr ifji= jktLFkku ljdkj okf.kfT;d dj foHkkx Øekad % i- 16¼201½ dj@oSV@vk;qDr@108@ fnukad 1 tqykbZ] 2006 leLr mik;qDr ¼iz'kk-½ leLr dj fu/kkZj.k vf/kdkjh jkT; ds iathd`r O;ogkfj;ksa ds ikl fnukad 31 ekpZ] 2006 dks LVkWd esa 'ks"k ,sls eky] ftl ij jkT; esa i`Fkd ls foØ; dj pqdk;k x;k Fkk vFkok tks dj lanRr Fkk] ij oSV iz.kkyh esa buiqV VSDl ØsfMV miyC/k djk;h x;h gSA jktLFkku ewY; ifjof)Zr dj vf/kfu;e] 2003 dh /kkjk 19 o jktLFkku ewY; ifjof)Zr dh fu;e] 2006 ds fu;e 18¼11½ esa bl laca/k esa fof'k"V izko/kku fd;s x;s gSA iathd`r O;ogkjh ekg tqykbZ] 2006 ls leku N% ekfld fd'rksa esa bls Dyse dj ldsaxsA eSa vk'kk djrk gwa fd leLr dj fu/kkZj.k vf/kdkfj;ksa us iathd`r O;ogkfj;ksa }kjk izLrqr lwpuk dk xgu fo'ys"k.k vius Lrj ij dj fy;k gksxkA LVkd dh izkIr lwpuk ds laca/k esa] fuEukuqlkj dk;Zokgh fd;k tkuk Hkh lqfuf'pr djsa& 1- ------- 2------ 3------ 4------- 5-------- 6------- 7--------- 8- fofuekZrkvksa ds LVkd esa fnukad 31-3-2006 dks miyC/k rS;kj eky esa mi;ksx fd;s x;s dPps ekyA izlaLdj.k eky ij buiqV VSDl ØsfMV dk Dyse Lohdk;Z ugha gksxkA**----- 5. The learned Deputy Commissioner (Appeals) allowed the first appeal filed by the Assessee against the Assessment Order dated 19.1.2007 in the following manner:- ^^fopkjk/khu izdj.k ds voyksdu ls ;g Li"V :i ls izdV gksrk gS fd dj fu/kkZj.k vf/kdkjh }kjk ekcZy CykDl ds vfUre iksrs eky dh jkf'k ij ITC Credit vLohdkj djus dk izeq[k vk/kkj foHkkxh; ifji= dks cuk;k x;k gS ,oa bl laca/k esa oSV vf/kfu;e dh /kkjk 19 dh leqfpr O;k[;k ugha dh xbZ gS tks fd v)ZU;kf;d izfØ;k esa dh tkus okyh dk;Zokgh ds fy, vR;Ur vko';drk gksrh gS] D;ksafd fu.kZ; fy;s tkus dh ;g izfØ;k Lora= lksp] fu"i{k fopkjksa ,oa ncko o izHkko ls eqDr gksdj fof/k ds vuq:i gksuh pkfg;sA ,oa ;g fLFkfr mDr fookfnr vkns'k esa miyC/k ugha gSA vr% ekuuh; loksZPp U;k;ky; }kjk ikfjr mijksDr m)fjr fu.kZ; esa izfrikfnr fl)kUr ds izdk'k esa ;g vkns'k vfof/kd lkfcr gksus ls vikLr fd;k tkrk gS vkSj vihykFkhZ dh vihy Lohdkj dh tkdj ekcZy CykDl ds vfUre iksrs eky [kjhn dher ij pkgs x; ITC Credit Rs. 2,10,834/- dks Lohdkj fd;k tkrk gSA Qyr% vihykFkhZ dh vihy Lohdkj dh tkrh gSA vkns'k lquk;k x;kA lgh@& ¼vks-ih- dkcjk½ mik;qDr ¼vihYl½ okf.kfT;d dj] mn;iqj** 6. 2,10,834/- dks Lohdkj fd;k tkrk gSA Qyr% vihykFkhZ dh vihy Lohdkj dh tkrh gSA vkns'k lquk;k x;kA lgh@& ¼vks-ih- dkcjk½ mik;qDr ¼vihYl½ okf.kfT;d dj] mn;iqj** 6. However, the Revenue filed the second appeal before the learned Tax Board against the said order dated 30.6.2007 of the Deputy Commissioner (Appeals) which came to be allowed by the learned Tax Board in the following manner:- ^^bl izdj.k esa izR;FkhZ O;ogkjh }kjk mlds fnukad 31-3-2006 ds Dyksftax LVkWd dh lwpuk fofgr izi= esa fu/kkZfjr vof/k esa dj fu/kkZj.k vf/kdkjh dks izLrqr djrs gq, fnukad 31-3-2006 dks 'ks"k rS;kj eky (finished goods) esa mi;ksx fd;s x;s dPps eky Segment & consumables & Marble Blocks dh jkf'k Øe'k% :i;s 15]34]464@& o :i;s 54]93]348@& ij jkT; esa ,l-Vh- 17 ij lanRr fd;s gq, 3 izfr'kr dj dk buiqV VSDl ØsfMV Dyse fd;k x;kA izR;FkhZ O;ogkjh ds rS;kj eky (finished goods) fujflr jktLFkku foØ; dj vf/kfu;e] 1994 ds izko/kkuksa ds rgr dj ogu fd;k gqvk (tax suffered) eky ugha gksus ,oa bldk oSV vf/kfu;e dh /kkjk 18¼1½ esa fofnZ"V iz;kstuksa esa mi;ksx gsrq Ø; fd;k gqvk ugha gks ldrs ds dkj.k bl eky ij buiqV VSDl ØsfMV Dyse oSV vf/kfu;e dh /kkjk 19 ds izko/kkuksa ds rgr Lohdkj ;ksX; ugha gSA bl izdkj vk;qDr okf.kfT;d dj foHkkx dk ifji= fnukad 1-7-2006 oSV vf/kfu;e dh /kkjk 19 ds izko/kkuksa ds vuq:i gh gksus ds dkj.k mDr ifji= dk gokyk nsrs gq, dj fu/kkZj.k vf/kdkjh }kjk izR;FkhZ O;ogkjh ds fnukad 31-3-2006 dks 'ks"k jgs LVkWd ds rS;kj eky (finished goods) esa iz;qDr dPps eky ij lanRr dj dk oSV vf/kfu;e dh /kkjk 19 ds rgr buiqV VSDl ØsfMV dk Dyse vLohdkj fd;s tkus esa dksbZ fof/kd =qfV ugha dh xbZ gSA fo}ku mik;qDr ¼vihYl½ }kjk vius fu.kZ; esa mYysf[kr ¼2006½ 25 ,l-Vh-Vh- 11 ij ekuuh; mPpre U;k;ky; dk U;kf;d n`"VkUr >qa>quokyk o vU; cuke mRrj izns'k jkT; o vU; miyC/k ugha gSA ,slh fLFkfr esa mik;qDr ¼vihYl½ }kjk dj fu/kkZj.k vf/kdkjh ds oSV vf/kfu;e dh /kkjk 19 ds fof/kd izko/kkuksa ds vuqlkj ikfjr fof/k lEer ,oa U;k;ksfpr vkns'k fnukad 19-1-2007 dks ekuuh; mPpre U;k;ky; ds mDr U;kf;d n`"VkUr dk gokyk nsrs gq, vikLr fd;s tkus esa fof/kd =qfV dh xbZ gSA blfy, mik;qDr ¼vihYl½ dk fu.kZ; fnukad 30-6-2007 vikLr ;ksX; gSA ifj.kker% jktLo dh vihy Lohdkj dh tkrh gS ,oa mik;qDr ¼vihYl½] okf.kfT;d dj mn;iqj dk vihyk/khu vkns'k fnukad 30-6-2007 vikLr fd;k tkdj dj fu/kkZj.k vf/kdkjh dk vkns'k fnukad 19-1-2007 ;Fkkor cgky fd;k tkrk gSA fu.kZ; lquk;k x;kA lgh@& ¼vks-ih- lgkj.k½ lnL;** 7. Aggrieved by the said order of the learned Tax Board, the Assessee has filed the present revision petition before this Court. 8. The learned counsel Mr. Sanjeev Johari with Mr. Pritesh Mandover appearing for the petitioner-assessee submitted that the Circular dated 1.7.2006 issued by the Commissioner illegally interferes with the quasi-judicial discretion of the Assessing Authority in passing the assessment order under the Rajasthan VAT Act, 2003 but on the other hand, it also wrongly construes the provisions of Section 19 of the Rajasthan VAT Act, 2003 like, in the present case, the words employed "input credit shall be allowed on the goods other than the capital goods which has suffered tax under the repealed Act and are lying in stock." The learned counsel further submitted that the goods include raw material as well as processed goods and, therefore, the tax suffered by the assessee on the purchase of raw materials like segment, consumables and marble blocks of which he manufactured the finished goods namely, the marble slabs and tiles, which were sold after coming into force the Rajasthan VAT Act, 2003 w.e.f. 1.4.2006 and such tax suffered by the assessee on the purchase of the aforesaid raw materials were clearly entitled to be deducted/credited as input tax credit against the liability of payment of VAT on the sale of finished goods after coming into force the Rajasthan VAT Act, 2003 under Section 19 of the Act which provided for input tax credit of the tax suffered on purchase of raw materials and processed goods purchased for manufacture of finished goods under the repealed Act, i.e., the Rajasthan Sales Tax Act, 1994. The learned counsel Mr. Sanjeev Johari contended that there is no evidence on record that the assessee has violated any of the conditions of Section 19 including the clauses (a) to (f) of Section 18 of the Act of 2003 like, the sale within the State of Rajasthan; or sale in the course of Inter-State trade and commerce and, therefore, relying upon a wrong interpretation of Section 19 of the VAT Act of 2003 in the Commissioner's Circular dated 1.7.2006, the Assessing Authority could not have disallowed the input tax credit and the Deputy Commissioner (Appeals) has very rightly allowed the appeal of the assessee which was, however, reversed by the learned Tax Board albeit wrongly. The learned counsel, therefore, prayed for allowing the present revision petition of the assessee and setting aside of the impugned order of the learned Tax Board dated 7.6.2010. 9. On the other hand, the learned counsel Mr. V.K. Mathur and Mr. Dinesh Godara appearing for the Revenue submitted that the Circular dated 1.7.2006 issued by the Commissioner of Commercial Taxes is of clarificatory nature and only explained the provisions of the new Act, i.e., the Rajasthan VAT Act, 2003 and although the words used under Section 19 of the Act of 2003 are "goods other than capital goods" but since, no tax was paid on the finished goods on the sale thereof under the repealed Act of 1994, therefore, the Tax Board's order deserves to be upheld, though Mr. V.K. Mathur, in all fairness, could not distinguish the words `raw materials/processed goods' for taking them out of the general terms `goods other than capital goods" employed in Section 19 of the Act of 2003. 10. Having heard the learned counsels for the parties and upon perusal of the impugned orders and the circular dated 1.7.2006 issued by the Commissioner, Commercial Taxes as also the provisions of the Act of 2003 particularly its Section 19, this Court is of the clear opinion that clause (8) of the Commissioner's Circular dated 1.7.2006, quoted herein above, illegally restricts the scope and application of Section 19 of the Act of 2003 inserted in the Act w.e.f. 1.4.2006, quoted herein above. The learned Commissioner, Commercial Taxes has fallen in error, while directing the lower Assessing Authorities that the tax suffered on raw materials/processed goods used in manufacture of finished goods lying in stock as on 31.3.2006, such input tax credit will not be allowed against the tax payable on sale of such finished goods taxable under VAT Act, 2003. This restriction is clearly contrary to the language of Sec. 19 of the Act of 2003 which makes exception only for capital goods and input tax credit of the tax suffered on purchase of the raw materials other than capital goods under the repealed Act of 1994 is clearly allowance as per Section 19 of the Act of 2003. This restriction is clearly contrary to the language of Sec. 19 of the Act of 2003 which makes exception only for capital goods and input tax credit of the tax suffered on purchase of the raw materials other than capital goods under the repealed Act of 1994 is clearly allowance as per Section 19 of the Act of 2003. Other than capital goods, any tax suffered by the assessee on the purchase of raw materials and the processed articles, like marble block, segments and consumables in the present case lying in stock on the closing date 31.3.2006 then such tax suffered has to be allowed as set off or input tax credit against the tax payable on the sale of finished goods namely, marble slabs in the present case, under Section 19 of the Act of 2003 which has come into force in the State of Rajasthan w.e.f. 1.4.2006. 11. The issuance of such circulars which are assumed to be binding on lower authorities restricting the quasi judicial discretion of the Assessing Authority have to be ignored. The Head of the Department like, the Commissioner of Commercial Taxes in such cases has to be very careful and vigilant when he issues such Circulars as a guidance for the lower Assessing Authorities and they should normally be based on legal opinion to be sought by the Department before the issuance of such Circulars. The Head of the Department like, the Commissioner of Commercial Taxes in such cases has to be very careful and vigilant when he issues such Circulars as a guidance for the lower Assessing Authorities and they should normally be based on legal opinion to be sought by the Department before the issuance of such Circulars. The singular view of the Head of the Department may or may not be correct on a judicial interpretation of the legal provisions of the Act and, therefore, normally, such Circulars making interference in the quasi judicial discretion of the Assessing Authorities should not be issued by the Department but if they are at all issued for the guidance of the lower authorities which power possibly cannot be ruled out as available with the Commissioner of the Commercial Taxes, it is needless to say that the same has to be issued in a very clear and unambiguous manner taking into account the language of the relevant provisions and, as aforesaid, such Circular (s) should be based on proper legal opinion to be sought by the Department before issuing such Circular because this will obviate and avoid unnecessary litigation in the Courts of law, which takes long times to settle such controversy and in the long interregnum period, a large number of assesses and Revenue itself might suffer financial loss. 12. In view of the aforesaid and clear provisions of Section 19 of the Act of 2003, this Court has no hesitation in holding that the learned Tax Board has erred in setting aside the well reasoned order of the Deputy Commissioner (Appeals) and the present revision petition filed by the assessee deserves to be allowed and the assessee is clearly entitled to the input tax credit in respect of the tax suffered by him on the purchase of raw materials/processed goods, like the marble blocks, segments and consumables against the tax payable on the sale of finished goods namely, marble slabs and tiles, in the present case, under the provisions of Section 19 of the Rajasthan VAT Act, 2003. 13. Accordingly and in view of the above, the present revision petition filed on behalf of the petitioner- M/s. Arihant Tiles and Marbles (P) Ltd. is allowed. The order of the learned Tax Board dated 7.6.2010 is quashed and set aside and that of Deputy Commissioner (Appeals) dated 30.6.2007 is restored. No costs. 13. Accordingly and in view of the above, the present revision petition filed on behalf of the petitioner- M/s. Arihant Tiles and Marbles (P) Ltd. is allowed. The order of the learned Tax Board dated 7.6.2010 is quashed and set aside and that of Deputy Commissioner (Appeals) dated 30.6.2007 is restored. No costs. A copy of this order be sent to the Rajasthan Tax Board, Ajmer and the parties concerned forthwith.