ZUVARI CEMENT LTD. Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) BOTH these appeals are filed against the orders of the Appellate Deputy Commissioner (CT), Kurnool, for the assessment year 1998 -99. T.A. No. 464/02 under the CST Act, 1956 & T.A. No. 463/02 under the APGST Act, 1957. The statement of facts and grounds of appeal being on the similar lines, these two appeals are being disposed of by a common order.

(2.) TWO major issues are involved in these appeals. Firstly, the appellant has gone for expansion of the original unit in the year 1998 -99 and had commenced commercial production in the expanded unit from 15.2.1999. The appellant was enjoying sales tax deferment as per G.O.Ms. No. 108, I & C (IP) Dept., dt. 20.5.1996 and G.O.Ms. No. 314, Rev., (CT.II) Department, dated 28.4.88 w.e.f. 1.4.1976. Under the said G.Os., the Industries Department issued them a Final Eligibility Certificate dated 10.4.2001. In this, the Industries Department fixed their base production quantity to be 5,64,700 MTs. It is the appellants contention that according to the Final Eligibility Certificate, the appellant is eligible for deferment of sales tax on sales made out of production achieved over and above the base production i.e., 5,64,700 MTs. Their expanded unit commenced commercial production only from 15.2.1999. The assessing authority did not allow the deferment to the appellant for the year 1998 -99 as the appellant had not crossed the base production fixed in the Final Eligibility Certificate during the period from 15.2.1999 to 31.3.1999. The appellant submits that the dealer has to pay sales tax to the Commercial Tax Department on monthly basis and not on yearly basis. Therefore, for February and March, 1999, their base production should be taken on prorata basis in order to allow them to avail the sales tax deferment for this period. According to them, this would be a fair way of allowing them the incentive as otherwise the sales tax deferment cannot be availed by them for 1998 -99. They have further stated that according to para 7 of the G.O.Ms. No. 108 under which the appellant has been granted sales tax exemption, incentives are permitted for the enhanced turnover above the base turnover. According to them, the prorata base production is 47,058 MTs which was reached by them by 19.3.1999. According to them, therefore, they are eligible for sales tax deferment on sales effected after 20.3.1999.

(3.) THE learned State Representative has argued that the Final Eligibility Certificate of the Industries Department does not provide for working out base production on prorata basis. It is very clear from the Certificate issued by the Industries Department that this facility is to be allowed on the production achieved over and above the base production of 5,64,700 MTs. In view of the clear and unambiguous language of the Final Eligibility Certificate, the appellant does not qualify for the sales tax deferment for the brief period of 12 days from 20.3.1999 to 31.3.1999, in the assessment year 1998 -99, as the base production level fixed by the Industries Department was not crossed by the appellant. On the issue of sales to TTD., the learned State Representative does not oppose relief to the appellant in view of the Certificate now presented by the appellant.