MUKUL N SHAH Vs. COMMISSIONER OF TRADE TAX

JUDGEMENT

(1.) The present revision under Section 4- A of the U.P. Trade Tax Act (hereinafter referred to as the Act). The applicant, a partnership firm is engaged in the business of manufacture and sale of detergent powder and established a new unit at 46 Panki Industrial Area, Site-I, Kanpur and effected its first sale of 26th of March, 1990. The plot on which the Unit was established was taken on lease from the industrial Department, Govt. of U.P. by means of a registered lease deed dated 17.7.1989 for a term of 99 years on total premium of Rs. 2,50,537-50 payable in 15 equal installments alongwith the interest at the rate of 6% per annum. The applicant applied for and was granted eligibility certificate under Section 4A of the Act. The dispute in the present revision is confined to only one issue namely whether the applicant is entitled to the exemption certificate for a period of three years as granted by the Divisional Level Committee or for a period of 5 years as claimed by it. All the authorities below have held that the total investment of the applicant in the land, plant and building being less than Rs. 3 Lakhs, therefore, the benefit under Section 4 A has been rightly granted to it for a period of three years from the date of first sale. Challenging the legality and propriety of the aforesaid finding the present revision has been filed. Shri Piyush Agrawal, the learned counsel for the applicant, submitted that the authorities below while calculating the period of exemption has taken into account only the installment paid by the applicant upto the date of first sale. The applicant having taken the land in question on lease and paid the consideration in 15 installments while calculating the capital investment, the entire consideration namely Rs. 2,50,537-50 should have been taken into account and if the said amount is taken into account, the applicant would be entitled for exemption for a period of 5 years.

(2.) The notification issued in the year 1984 under which the applicant seeks exemption has defined the capital investment as follows: "Capital investment means 'investment' in land, building, plant and machinery and equipment and apparatus."

(3.) It was submitted that the word 'in' used the aforesaid sentence clearly shows that the investment made in land, building, plant and machinery and equipment and apparatus, irrespective of the actual payment should be considered while deciding the application for grant of eligibility certificate.