RISHABH ELECTRICALS PVT LTD Vs. STATE OF ORISSA

JUDGEMENT

(1.) THE petitioner, M/s. Rishabh Electricals Pvt. Ltd., has filed this writ petition under Articles 226 and 227 of the Constitution of India with a prayer to (1) declare that the petitioner -industry is entitled to sales tax exemption in view of Entry 43 -A of the Finance Department Notification dated 26.7.1996, (2) to direct the O.Ps. to grant sales tax exemption to the petitioner as per the specific provision made in this regard in the Industrial Policy Resolution 1996 and (c) to declare that the petitioner -industry being a priority industry is entitled to sales tax exemption.

(2.) THIS case was heard along with W.P.(C) No.5616/2003 and the counter affidavit filed by the Industries Department in the present case was adopted in W.P.(C) No.5616/2003. Ultimately, the aforesaid writ petition was allowed by this Court by judgment dated 8.2.2007, which has been reported in 103 (2007) CLT 658 : 2007(Supp. -l) OLR 530 M/s. Hi Tek Powercon Pvt. Ltd. v. Asst. Commissioner of Commercial Taxes, Cuttack. In the present case the Industries Department has filed a counter affidavit taking a stand that since incentives under priority sector are envisaged for industries having investment over rupees one crore, the notification of the Finance Department takes into account such industries since an investment level of rupees one crore and above falls in the category of medium/large scale. Thus, a priority industry with rupees one crore and above investment which would be medium/ large scale industry and since the intention of IPR 1996 was to give incentives to industries in priority sector, such industries can get the benefit under Entry 43 -A. So according to the Industries Department, the petitioner -Unit is not entitled to get such benefit.

(3.) LEARNED counsel for the petitioner submitted that the statement made in the counter affidavit filed by the Finance Department that all priority industries having project cost of more than Rs. 1.00 crore have been treated by the Finance Department either as medium or large scale industries, is wrong. It was argued that the Finance Department completely misunderstood in treating the project cost to be equivalent to fixed capital investment and as such treating the priority industries primarily as medium and large scale industrial unit, was erroneous and not in conformity with the I.P.R. 1996.