BOSS GEARS LTD Vs. SALES TAX TRIBUNAL

JUDGEMENT

(1.) Section 13-B was introduced in the Haryana General Sales Tax Act, 1973 (hereinafter called the Act) by Act No. 26 of 1988 published in the Haryana Government Gazette on 8.9.1988 and it provides that the State Government may, if satisfied that it is necessary or expedient so to do in the interest of industrial development of the State, exempt such class of industries from the payment of tax for such period and subject to such conditions as may be prescribed. In exercise of the powers conferred by this provisions, the State Government framed Rule 28-A which was introduced in the Haryana General Sales Tax Rules, 1975 (for short the Rules) on 17.5.1989. This Rule became operative with effect from the 1st day of April, 1988 and was to continue till 31st day of March, 1997. It was amended on 3.6.1997 with effect from 1.4.1997 and the amendment provided that it shall continue till the date on which new policy for incentive to industry is announced by the Government of Haryana in the Industries Department. The new policy for incentive to the industry in the State was announced by the Government of Haryana on 1.8.1997. Rule 28-A, therefore, ceased to operate with effect from 1.8.1997.

(2.) With a view to give effect to the new industrial policy as announced on 1.8.1997, the State Government framed Rule 28-B by adding Chapter IV-B in the Rules. This Rule was inserted in the Rules on 18.5.1999 and it became operative from the 1st day of August, 1997 and was to end on the date on which the policy for incentive to industry is terminated/revised by the Government of Haryana in the Industries Department. We are concerned with this Rule in the present case. This Rule provides for incentive of exemption/deferment of payment of tax to the eligible industrial units. "Eligible industrial unit" has been defined in Clause (f) of Sub-rule (3) of Rule 28-B of the Rules and it reads as under:-

(3.) Petitioner before us is a limited company which has set up a new industrial unit for the manufacture of automobile parts at Sikanderpur (Bada) in District Gurgaon in the State of Haryana. In terms of Rule 28-B(6)(a) of the Rules the petitioner applied on 13.8.1999 for the issue of Eligibility Certificate for availing the benefit of deferment of sales tax with effect from the date when it went into commercial production. This option was exercised in terms of Rule 28-B(5)(a) of the Rules. The application was processed by the General Manager, District Industries Centres, Gurgaon and the same was considered by the Higher Level Screening Committee in its meeting held on 20.5.2000. This Committee observed that the petitioner had filed its sales tax return upto 31.3.1999 and had paid tax upto that date but it had not filed its quarterly returns for the subsequent quarter ending 30.6.1999, 30.9.1999 and 31.12.1999. It was further observed that tax for these quarters had also not been paid, the unit was found to be in default of payment of voluntary tax for three quarters and, therefore, it held the unit to be ineligible for claiming the benefit of tax deferment. Consequently, the application filed for the grant of Eligibility Certificate was rejected. A communication to this effect was received by the petitioner as per letter dated 11.7.2000 from the Director of Industries Haryana. Feeling aggrieved by the order passed by the Higher Level screening Committee the petitioner filed an appeal before the Sales Tax Tribunal, Haryana which Was dismissed on 1.2.2001. The Tribunal also observed that since the petitioner had voluntarily filed its sales tax returns upto 31.3.1999 and had paid tax for those quarters, it must be presumed that it opted for determent of sales tax from the date of issue of Entitlement Certificate and not from the date when it went into commercial production. The Tribunal also held that the petitioner had defaulted in the payment of tax for some of the quarters and, therefore, it had become ineligible to avail the said concession. It is against these orders that the present petition has been filed under Article 226 of the Constitution.