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1995 (7) TMI 337 - SC - VAT and Sales TaxWhether the respondent is entitled to the benefit of exemption from sales tax under the Industrial Policy Resolution of 1986 as well as of 1989? Whether the process undertaken by the respondent, applying which he obtains cotton from waste cotton, can be called "manufacturing" activity? Held that:- Appeal allowed. A reading of the Industrial Policy Resolution (I.P.R.) of 1986 as well as of 1989 clearly shows that several concessions at substantial cost to public exchequer were provided only with a view to accelerate the pace of industrialisation in the State. The High Court seems to have proceeded on the assumption that the I.P.R. by itself is enough to provide the exemption from the sales tax. But where the provisions of the Sales Tax Act are also amended providing for exemption, then the court has to see whether they are the same as the I.P.R. or are they different-and if different, what is the effect of such difference. It is, therefore, necessary to ascertain the relevant provisions in the Sales Tax Act, Rules and notifications, if any, issued thereunder before expressing a final opinion in the matter. The dealers and assessees normally contend that the process undertaken by them does not involve manufacture, that no new goods have come into existence and that, therefore, no tax or duty is leviable. But here the respondent is adopting a converse position because it is beneficial to him under the I.P.R. Thus the proper course would be to remit the matter to the High Court for a decision afresh in the light of the observations made herein.
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