RAGAM PLASTICS Vs. SALES TAX OFFICER

JUDGEMENT

(1.) The only point for decision in this original petition is as to whether new industrial units entitled to a limited exemption from sales tax as per notification of Government S.R.O. 968/80 are excluded from the benefits of a lower rate of tax as provided for in sub-sec. (3) of S.5 of the Kerala General Sales Tax Act as substituted by the Kerala Finance Act 18/1987.

(2.) There is no dispute that the three petitioners are small scale industrial units established after the notification aforesaid and they are entitled to the benefits of the notification. Their claims for the benefits of sub-sec. (3) of S. S were referred by the respective sales tax officers and the Deputy Commissioner (Sales Tax) to the Board of Revenue for clarification as can be seen from Exts. P1, P3 to P5 and P7. The Board of Revenue has taken the view that small scale industrial units entitled to exemption from sales tax under the notification S.R.O. 968/80 are not entitled to the benefits of the lower rate of tax as provided for in S.5 (3) of the Act. Ext. P9 dated 1-1-1988 (produced along with C. M. P. No. 1609/1988) is a communication from the Deputy Commissioner, Agricultural Income Tax and Sales Tax, Ernakulam addressed to the 3rd petitioner wherein it is stated:

(3.) Sub-section (7) of S.5 was omitted and re-enacted as sub-section (3) by S.2 of the Kerala Finance Act 18/1987. Sub-section (3) of S. S (as substituted by the Finance Act) with its first proviso is extracted below: