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2011 (3) TMI 1501 - HC - VAT and Sales TaxWhether the Tribunal is right in concluding that sale of water plant machinery, i.e. reverse osmosis plant by the petitioner do not fall under section 3(5) of the Tamil Nadu General Sales Tax Act, when the petitioner satisfied both the conditions as prescribed under the section? Whether the Tribunal is correct in rejecting the claim of concessional levy when the petitioner has filed declaration forms as per the provisions of section 3(5) of the Act? Held that:- Section 3(5) of the Act is a beneficial provision. It provides for concession for tax purposes to encourage industrial activity. It should be liberally construed. It is well-settled principle that a provision which is a taxing statute, granting concessional and incentives for promoting growth and development, should be construed liberally. Therefore, we are of the view that plant and machinery is used for the purpose of treating water for the bleaching and dyeing in the textile factory. Therefore, it cannot be said it is not used for the purpose of manufacture. The assessee has satisfied all the conditions enumerated and section 3(5) of the Act and hence, they are entitled to the concessional rate of tax under section 3(5) of the Act. In these circumstances, the order passed by the Tribunal is not in accordance with law and we set aside the order of the authorities below and answer the questions in favour of the petitioner/assessee and against the Revenue. Consequently, the revision is allowed.
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