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2016 (10) TMI 1184 - HC - VAT and Sales TaxDemand of interest - default or delay in repayment of loan - eligibility certificate for availing benefit of deferment of payment of tax - Rule 28-B of the Haryana General Sales Tax Rules, 1975 - Held that: - Rule 28-B of the Rules provided for class of industries, period and other conditions for exemption/ deferment from payment of tax. The operative period was from 1.8.1997 ending on the date on which the policy for incentives to industries is terminated/ revised by the Government of Haryana in Industries Department. The benefits are either for exemption from payment of tax or deferment for payment of tax to eligible industrial units for the period and the extent of amount as mentioned in Sub-Rule 5 thereof. The benefit and time had relevance with the area where the industry was located. In the case in hand, as the facts are on record, the validity of the eligibility certificate of the petitioner was from 9.9.1997 to 8.9.2006. The total amount of admissible benefit to the petitioner was ₹ 44.68 lacs, out of which ₹ 43,90,396/- was availed of by the petitioner upto 30.6.2000. Thereafter, the plant and machinery was partly sold and partly it was leased out. From 30.6.2000, the unit is not in production. As the petitioner violated the conditions of eligibility certificate, the matter was put up in 92nd meeting of the Higher Level Screening Committee on 16.2.2006 and finding violation of the conditions laid down in Rule 28-B of the Rules, the committee decided to withdraw the eligibility certificate. As a consequence, the petitioner became liable to pay the entire amount of tax, interest and penalty in terms of Rule 28-B (10)(b) of the Rules, as if the benefit of deferment of tax/ exemption was not available to the petitioner. The benefit of interest free loan could be availed of only by an industrial unit in whose favour eligibility/ entitlement certificate had been issued in terms of the incentive scheme as notified on 17.5.1989 (Rule 28-A of the Rules), however, it is not in dispute that the Scheme was made applicable even to the beneficiaries under Rule 28-B of the Rules. In case a unit is not in possession of the eligibility certificate, he could not claim the benefit of interest free loan under the Scheme. Moment the eligibility certificate is withdrawn, the entire clock has to be put back, namely, that the petitioner availed of certain benefits to which he was not entitled to. The Scheme is not as such independent as it was inter-woven with the Rules 28-A and 28-B of the Rules. The petitioner having settled the liability of the sale tax department by raising loan from the Industries Department, he would certainly become liable to pay interest at the rate as provided for under the Act for the period the loan amount was utilised by it - petition dismissed.
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