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2015 (5) TMI 62 - HC - VAT and Sales TaxConcessional rate of entry tax - Section 9C of the Orissa Entry Tax Act, 1999 - petitioner is engaged in business of generation of electricity and distribution thereof in the State of Odisha - whether generation of electricity is a manufacturing activity. - Held that:- Court in the case of Orient Paper & Industries Ltd. (1989 (1) TMI 138 - HIGH COURT OF ORISSA) while interpreting Section 2(b) of the Central Excise and Salt Act, 1944 has held that generation of electricity for the purpose of Central Excise and Salt Act is "manufacture or production of electricity", since the term "manufacture or production" is to be given a wide meaning. - In view of the definition of 'manufacture' as provided in Section 2(28) of OVAT Act read with Rule 2(1)(c) of the OET Rules and Section 2(q) of the OET Act and all the above judicial pronouncements of the Hon'ble Supreme Court and High Court, we are of the considered view that the activity of generating electricity in thermal power plant by using coal would qualify as a manufacturing activity. Whether coal is a raw-material for generation of electricity in thermal power plant - Held that:- When the processes that are involved in manufacturing/ generation/production of electricity in a thermal plant as narrated in the preceding paragraph is considered in the light of the above observation of the Hon'ble Supreme Court, it can safely be concluded that coal is a raw material for production/generation of electricity. - perusal of the impugned assessment order reveals that before the Assessing Authority, the petitioner produced the expert opinion obtained from IIT, Kharagpur, wherein, it has been opined that coal is a raw material which results in the emergence of electricity. Whether the reasons given by the learned Assessing Authority for disallowing the petitioner's claim to avail concessional levy of entry tax in terms of Rule 3(4) of the OET Rules are legally valid - Held that:- it extreme difficult to accept the above reasons given by the Assessing Authority to hold that coal is not a raw material for generation/production of electricity in thermal power station and that generation of electricity is not a manufacturing activity and therefore the petitioner is not entitled to avail concessional rate of entry tax as provided under Rule 3(4) of the OET Rules. - by no stretch of imagination, it can be said that the findings/observations of this Court that 'coal is a raw material for generation of electricity' are unnecessary for the decision of that case or it does not relate to the material facts in issue. Therefore, the learned Assessing Authority is wholly unjustified to hold that the observation of this Court in Bhusan Power and Steel Ltd. (2012 (11) TMI 696 - ORISSA HIGH COURT) that "coal is a raw material for generation of electricity" is a cursory remark, i.e., obiter dicta. Even though the petitioner has filed a written submission in course of the assessment proceeding as evident from the impugned assessment order relying on various statutory provisions, the Supreme Court judgments, judgments of the High Court in support of its contention, the Assessing Authority without dealing with the contention of the petitioner with reference to the judgments relied upon by it passed the assessment order raising huge tax and penalty amounting to ₹ 7,22,44,608/-. Thus, the impugned order shows complete non-application of mind which ultimately amounts to judicial indiscipline and impropriety. The Assessing Authority, who is Joint Commissioner of Sales Tax, Sambalpur Range, Sambalpur, being a fairly senior officer is always expected to take note of various decisions of the Hon'ble Supreme Court/High Court placed before him by the assessee before passing any order. It may not be appropriate to say that competent and efficient Assessing Authorities are to be posted because the fate of litigants is dependent upon their proper adjudication. - petitioner is entitled to avail concessional rate of entry tax on coal in terms of Rule 3(4) of the OET Rules - Decidedin favour of assessee.
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