BUTANI COTTON INDUSTRIES Vs. STATE OF GUJARAT

JUDGEMENT

(1.) BY this petition, under articles 226 and 227 of the Constitution, the petitioner has challenged the order dated 10th January, 2006, passed by the Gujarat Sales Tax Tribunal (hereinafter referred to as, "the Tribunal") in Revision Application Nos. 115 and 116 of 2002 (annexure G to the petition). The facts, as appearing in the petition, are that the petitioner is a firm duly incorporated under the provisions of the Indian Partnership Act, 1932 and is engaged in the business of cotton and cotton seeds. The petitioner is a registered dealer as per the provisions of the Gujarat Sales Tax Act, 1969 (hereinafter referred to as, "the Act").

(2.) THE Government of Gujarat in its Industries Mines and Energy Department, by a resolution dated May 6, 1986 framed a scheme known as "Special Incentive for Pioneer Unit -86" (hereinafter referred to as "the scheme"). The scheme was to come into operation with effect from April 1, 1986 and was to remain in force for a period of five years up to March 31, 1991. The petitioner was registered under the aforesaid beneficial scheme as an eligible unit for the purposes of obtaining the sales tax incentive under the said scheme. The petitioner was issued an eligibility certificate dated September 21, 1989 by the District Industries Centre granting benefit to it to the tune of Rs. 2,41,000. The product mentioned in the said certificate was cotton and cotton seeds. Pursuant thereto, the petitioner made an application dated September 26, 1989 before the Assistant Sales Tax Commissioner for granting it sales tax exemption certificate for cottonseeds. By a certificate dated March 14, 1990 the petitioner was granted sales tax exemption to the extent of Rs. 2,41,000 under entry 175 in respect of the cotton seeds only.

(3.) SUBSEQUENTLY , respondent No. 2 initiated proceedings for revision of the assessment of the petitioner in exercise of powers under section 67 of the Act and by an order dated September 16, 2002, revised the assessment order holding that the petitioner had claimed exemption only for cottonseeds whereas it should also have claimed exemption for cotton. The exemption to the extent of Rs. 66,755 along with interest thereon came to be disallowed and penalty as well as interest came to be levied thereon. Being aggrieved by the aforesaid order passed by the revisional authority, the petitioner preferred Revision Application Nos. 115 and 116 of 2002 before the Tribunal. By the impugned order dated January 10, 2006 the revision applications came to be rejected holding that although there was no exemption on cotton in the exemption certificate, the sales tax authorities should not have granted such certificate which was not as per eligibility certificate and, therefore, it defeats the purpose of the scheme. Being aggrieved, the petitioner has filed the present petition.