JYOTI PHOSCHEM Vs. STATE OF PUNJAB

JUDGEMENT

(1.) The petitioner has invoked jurisdiction of this Court under article 226 of the Constitution of India for grant of the following substantive relief :

(2.) The petitioner is engaged in the business of manufacture and sale of di-calcium phosphate and tri-calcium phosphate in its unit situated at 38, Focal Point, Mehta Road, Amritsar. It is registered as a dealer under the Punjab General Sales Tax Act, 1948 (for short, "the 1948 Act") and the Central Sales Tax Act, 1956 (for short "the 1956 Act" ). The unit of the petitioner went into commercial production in 1991. After complying with the formalities prescribed under the New Industrial Policy, 1989, it was granted eligibility certificate on March 19, 1991 for deferment of sales tax to the tune of Rs. 14,47,571 for a period of 9 years commencing from January 21, 1991. Thereafter, the Assistant Excise and Taxation Commissioner, Amritsar, issued deferment certificate in form ST (D and E)-II for grant of benefit of deferment under the Punjab General Sales Tax (Deferment and Exemption), Rules, 1991 (for short, "the 1991 Rules") up to January 21, 2000. In the year 1996, the petitioner applied for grant of eligibility certificate under the Punjab Industrial Incentive Code, 1996 (for short "the Incentive Code") in respect of the expanded portion of its existing unit by claiming that it had made investments for expansion in order to avail of the benefit of the new industrial policy which was notified on March 20, 1996. The General Manager, District Industries Centre, Amritsar, accepted its application and granted eligibility certificate for sale tax deferment to the tune of Rs. 30,75,000 by mentioning that the manufacturing unit went into production on October 17, 1997 after expansion. Thereafter, the petitioner applied to the authority prescribed under the 1948 Act for issuance of deferment certificate. By an order dated April 27, 1998, the Assistant Excise and Taxation Commissioner, Amritsar, granted benefit of deferment to the tune of Rs. 30,75,000 on incremental basis for a period spread over 10 years from October 17, 1997 to October 16, 2007 and instead of issuing fresh deferment certificate, he made an entry to this effect in the certificate dated May 5, 1992.

(3.) The petitioner has challenged the order passed by the Assistant Excise and Taxation Commissioner, Amritsar by contending that in view of the express provisions contained in rule 2. 5 read with rule 6. 3 of the Incentive Code the condition of incremental deferment cannot be applied to the expanded portion of its unit. According it, the rules embodied in the Incentive Code are applicable to the expanded portion of its unit and the authority concerned did not have the jurisdiction to impose the arbitrary condition of granting the benefit of deferment on incremental basis. The petitioner has also challenged the notice, annexure P6, issued by the Excise and Taxation Officer-cum-Assessing Authority, Amritsar-I, under section 18 read with section 11-B of the 1948 Act requiring it to show cause against the proposed imposition of penalty and levy of interest by contending that such proceedings could not have been initiated on the basis of a void condition incorporated in the eligibility certificate.