RAJ TUBE MANUFACTURING COMPANY LTD Vs. STATE

JUDGEMENT

(1.) HEARD the learned counsel for the parties. The short question which is involved for consideration of this Court in the present writ petition is as to whether the petitioner which is a new industrial unit as defined in the Rajasthan Sales Tax Incentive Scheme for Industries, 1987 (hereinafter to be referred as "the Incentive Scheme"), should be entitled for the benefit of the exemption as a new unit with effect from the date on which the petitioner had applied to the sales tax authorities for exemption or whether it should be extended from a later date ? It has been contended by Shri Mehta, learned counsel for the petitioner, that the petitioner-company fulfilled all the requisite conditions for the grant of exemption from sales tax as provided in section 3 (2) of the Incentive Scheme. The petitioner-company had, in accordance with the provisions of the Incentive Scheme, moved an application dated July 8, 1988, in the prescribed format, to the sales tax authority for the grant of eligibility certificate duly accompanied with the requisite information. It has been further contended that the Screening Committee had inspected the petitioner's factory and assured the petitioner that its unit would be entitled to the benefit of eligibility certificate. It is further contended that the delay in issuance of the eligibility certificate has resulted in undue harassment to the petitioner-company inasmuch as that under the legal advice, the petitioner-company had honestly come to believe that it is exempted from the payment of sales tax under the Incentive Scheme from the date of commencement of the commercial production/date of application for the grant of eligibility certificate. Shri Mehta has also placed reliance upon the judgment of this Court in the matter of Om Shiv Shakti Cement Pvt. Ltd. v. State of Rajasthan reported in [1989] 72 STC 437 wherein this Court while dealing with similar situation held as under : " The general tenor of the provisions contained in the Incentive Schemes was that the certificate of eligibility was to be operative with effect from the date on which the application was submitted and not with effect from the date on which the certificate was issued. The tax concessions given under the Incentive Schemes were intended to enable the industrial units to get over certain handicaps. Delay in granting the certificate of eligibility would be bound to have an adverse effect on the viability of these units. Moreover, the delay in these cases was actually due to the time taken by the authorities in issuing guidelines for grant of the certificates, and in convening the meeting of the screening committee. The petitioners could not be denied the benefit of the Scheme for a period of nearly eight months, when they were in no way responsible for the delay. "

(2.) RELIANCE was also placed by the learned counsel for the petitioner on a judgment of the apex Court in the matter of Assessing Authority v. Patiala Biscuits Manufacturers Pvt. Ltd. reported in [1977] 39 STC 381 wherein the apex Court held as under : " that the language of sub-clause (a) of clause 4 of the Incentive Scheme which referred to 'an industrial unit which is granted eligibility certificate' does not militate against the construction that the eligibility certificate when granted should be operative with effect from the date of the application and not with effect from the date of issuance of the certificate. "