VOLVO INDIA PRIVATE LIMITED Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) WE have heard this appeal on 21 -2 -2008 and reserved for judgment. As judgment is not pronounced within three months, we got listed this matter today for rehearing and heard the learned Counsel Sri Vikram for appellant and Additional Government Advocate on behalf of the respondents. The learned Counsel for the appellant has invited our attention to the exemption notification dated 8 -6 -1998 granted in favour of the appellant -Company under Section 9 of the Central Sales Tax Act, 1956 (hereinafter called as 'CST Act' for short) read with Section 19C of the Karnataka Sales Tax Act, 1957 (hereinafter called as the "KST Act' for short) notified in the Karnataka Gazette in exercise of powers conferred upon the State Government under Section 19C of the KST Act, exempting the company from payment of sales tax under KST Act on the sale of finished goods manufactured by the appellant in its newly established unit, near Hoskote, Bangalore Rural District, for a period of 12 years from the date of commencement of commercial production with certain terms and conditions. The said exemption notification was modified by another communication sent by the State Government in exercise of its power under Section 9(2) of the CST Act read with Section 19C of the KST Act, incorporating additional condition to the exemption notification dated 8 -6 -1998. In the said notification for the words "exempts the tax payable under the Central Sales Tax Act, 1956", the words "exempts the sales tax payable under sub -section (2) of Section 8 of the CST Act" are substituted.

(2.) PURSUANT to the amendment, the Government issued notification dated 31 -5 -2002 Annexure -E in exercise of the power under sub -section (5) of Section 8 of the CST Act, stating that furnishing of declaration in Form 'C' or certificate in Form 'D', as the case may be, is a must for availing the benefit of tax exemption. Accordingly, the Government of Karnataka has granted exemption of sales tax to the appellant subject to the condition of furnishing of declaration in Form 'C' certificate and Form 'D' by the buyer.

(3.) THE orders passed by the Deputy Commissioner of Commercial Taxes calling upon the appellant to pay the sales tax to the department in a sum of Rs. 30,61,53,215/ - in the assessment order dated 22 -6 -2007 Annexure -F and the proposition notices at Annexures -F1, F2 and F3 under Section 12A of KST Act, 1957 read with Section 9(2) of CST Act, 1956 are challenged by the appellant in the writ petition by urging various grounds. The learned Single Judge dismissed the writ petition. The correctness of the said order is questioned in this appeal.