RSWM LIMITED Vs. STATE OF RAJASTHAN AND OTHERS

JUDGEMENT

(1.) By these two writ petitions, the petitioners have challenged the clarification issued by the Finance Department (Tax Division) of Government of Rajasthan on 10.10.2008 whereby the State Government issued clarification that the term "tax payable" under the Rajasthan Value Added Tax Act, 2003 is the amount of tax leviable under the Act less the amount of input tax credit if any for the purpose of the Scheme. The Scheme in question is Rajasthan Investment Promotion Policy, 2003 which was issued by the State Government on 20.8.2003 with a view to provide the investors an attractive opportunity to invest in the State of Rajasthan and certain incentives in the form of subsidy was directed to be paid to the eligible units. The facts illustratively are taken from SBCWP

(2.) Clause 7 of the Rajasthan Investment Promotion Policy, 2003 (RIPS 2003, for short) provides that in case of new investment made, the sum total of interest subsidy and wage/employment subsidy would be subject to a maximum limit of fifty percent of the tax payable and deposited under the Rajasthan Sales Tax Act, 1994, the Central Sales Tax Act, 1956 and Value Added Tax Act as and when introduced in the State. The Rajasthan VAT Act, 2003 was enforced w.e.f. 1.4.2006 during the operative period of RIPS, 2003, which was extended upto 31.3.2011. Clause 7(i)(a) of the Scheme reads as under:

(3.) The grievance raised in the present writ petition is that the said clarification issued by the State Government on 10.10.2008 is contrary to the provisions of RIPS, 2003 as well as Rajasthan VAT Act, 2003 which does not define as such the term "tax payable" as such.