SHYAMAL PRASAD DAS Vs. STATE OF TRIPURA

JUDGEMENT

(1.) THE petitioner, who is a manufacturer of steel furniture in Agartala, is aggrieved by the order passed by the sales tax authorities holding that the sales of taxable goods made by him are not exempt under sub-section (2) of section 3 of the Tripura Sales Tax Act, 1976, or sub-rule (2) of rule 5 of the Tripura Sales Tax Rules, 1976 and has approached this Court by filing the two present writ petitions. As the facts and questions of law involved in both the petitions are common, they were taken up for hearing together.

(2.) THE case of the petitioner is that he is carrying on the business of manufacture of steel furniture under the name and style of M/s. Steel Well Industries, Agartala. He is registered as a dealer under the Tripura Sales Tax Act, 1976 (hereinafter referred to as "the Act"). He is also registered as a small-scale industry with the Department of Industries to the Government of Tripura vide Registration No. SSC/AGT/8/78-79 dated may 2, 1978. The petitioner sold the goods manufactured by him in his newly set up small-scale industry and claimed the sales of taxable goods made by him as exempt from tax by virtue of the provisions contained in sub-section (20 of section 3 of the Act and sub-rule (2) of rule 5 of the Tripura Sales Tax Rules, 1976 (hereinafter referred to as "the Rules"). the Superintendent of Taxes, Agartala, rejected the contention of the petitioner on two grounds : Firstly, that sub-section (2) of section 3 is only an enabling provision and the same becomes effective only when a notification, as contemplated therein, is made by the State Government. As no such notification had been made in the present case, it was held that the petitioner was not entitled to claim exemption under the said provision. Secondly, that exemption under sub-rule (2) of rule 5 was not allowable to newly set up industry. Accordingly, claim for exemption from tax was rejected and tax was levied on its turnover, which was also estimated and the actual figures of sales were enhanced.

(3.) THE learned counsel for the petitioner, Mr. A. M. Lodh, made the following submissions : (i) that the petitioner is a newly set up small-scale industry and it is entitled to the exemption from payment of tax on its turnover as contemplated by sub-section (2) of section 3 of the Act; (ii) that the claim of the petitioner for exemption is also fully covered by sub-rule (2) of rule 5 of the Rules which provides that sales by a newly set up small-scale industry of goods manufactured by it shall not be taxable for a period of three years; (iii) that, in any event, the estimation of turnover made by the Superintendent of Taxes is most arbitrary, inasmuch as there is no basis or material in support of the same and the impugned assessments are not tenable on that ground also.