SOUTHERN REFINERIES LIMITED Vs. STATE OF KERALA

JUDGEMENT

(1.) The petitioner is an assessee under the Kerala General Sales Tax Act, 1963 (for short, "the KGST Act") and is aggrieved by the reduction of the period of exemption, by the assessing officer, as confirmed by the first appellate authority and the Tribunal. The petitioner/assessee is a medium scale industrial unit, which commenced commercial production on September 1, 1993. The petitioner claims to have been granted exemption under SRO. No. 1729/1993 for an amount of Rs. 3,66,44,000 for a period of seven years from September 1, 1993 to August 31, 2000. The petitioner has produced annexure A order of exemption dated November 24, 1995 which, along with annexure B, shows the eligibility to exemption, the period, quantum and the goods in respect of which exemption is granted. The bone of contention is only with respect to the period of exemption granted as per annexure A order. The petitioner claims that annexure A exemption order under SRO. No. 1729/1993 prescribes exemption for a period of seven years with respect to the petitioner's liability under the KGST Act, subject however, to the quantum of tax exemption which is also specified in annexure A. The present revision is with respect to the CST assessment of the petitioner completed for the year 1998-99. The petitioner claimed on the strength of annexure A order that in continuation of SRO. No. 1729/1993 issued under section 10 of the KGST Act, the Government has issued SRO. No. 1730/1993 under the CST Act granting reduced rate of two per cent for inter-State transaction, again for a period of seven years. Admittedly no separate exemption order is required to be passed under the Central Sales Tax Act or the notification issued thereunder.

(2.) The assessing officer rejected the claim of the petitioner for grant of exemption under the Central Sales Tax Act for the assessment year 1998-99 on the ground that exemption available to the petitioner as an industrial unit is not under SRO. No. 1730/1993, but is under SRO. No. 1731/1993. SRO. No. 1731/1993 grants the reduction in the rate of tax for industrial units only for a period of five years.

(3.) Annexure E order of assessment, finding the petitioner covered under SRO. No. 1731/1993, was challenged unsuccessfully by the petitioner before the first appellate authority as well as the Tribunal. The petitioner has produced SRO. No. Nos. 1729/1993, 1730/1993 and 1731/1993, respectively as annexures C, D and F. The counsel for the petitioner would contend that the definition of a "new industrial unit" under medium and large scale industries in SRO. No. 1730/1993 has adopted the definition in SRO. No. 1729/1993. Hence, the exemption granted to the petitioner, annexure A, under SRO. No. 1729/1993 for the liability under the KGST Act necessarily has to govern the petitioner's liability under the Central Sales Tax Act too; which is intended by the Government under SRO. No. 1730/1993. On the above premise, the petitioner has raised three questions of law, all boiling down to the eligibility of the petitioner under SRO. No. 1730/1993 for concessional rate of two per cent on the inter-State transactions for a period of seven years as against the prescription of five years under SRO. No. 1731/1993.