TMI Blog1995 (5) TMI 259X X X X Extracts X X X X X X X X Extracts X X X X ..... ree sales tax loan equivalent to the sales tax paid within the State by the units during the first five years subject to an annual maximum limit of 10 per cent of the capital invested, but not exceeding Rs. 25 lakhs per year. The loan shall be repaid after 10 years of each year's drawal." 3.. In pursuance of the said Policy of 1980 the State Government framed Orissa Sales Tax Loan Rules, 1980 laying down the method and procedure for claim, determination, sanction, disbursement, repayment and recovery of the said sales tax loan. 4.. The petitioner-company is a medium industry situated in a panchayat area. It started commercial production on and from April 1, 1986. The benefit under the 1980 policy and scheme was allowed to the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... olicy have been provided sales tax incentive under Part III. The relevant paragraphs of the said Policy of 1989 are reproduced below: "7.1.5. Deferment/Exemption of sales tax on finished products of medium and large scale industrial units.-New medium and large industrial units will be allowed to defer payment of sales tax collected on their finished products for a period of 7 years in Zones 'B' and 'C' and 9 years in Zone 'A' from the date of commercial production. Deferred amount in respect of each year will be repaid in full after the expiry of the period of deferment annually. In lieu of deferment new medium and large scale industrial units can opt for exemption of sales tax on finished products for a period of five years if the unit i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch expansion/modernisation/diversification has been undertaken on the basis of an exclusive project report duly appraised by financing institutions." 9.. Continuing unit of 1980 policy has been defined as "any industrial unit where capital investment commenced on or after August 1, 1980 and prior to April 1, 1986 and the unit has gone or goes into commercial production on or after April 1, 1986 ". 10.. The operational guidelines as envisaged by para 7.3.2. of the 1989 policy were framed on June 10, 1992. 11.. The petitioner-company, being a continuing unit of 1980 Policy was/is entitled to the new sales tax incentives under Part III. It claims that it was entitled to deferment/exemption of sales tax on and from the effective date, i. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1991 or alternatively for declaration that the benefit of 1989 policy is available from April 1, 1991 to March 31, 1998. 15.. The petitioner-company has contended that exemption period should be counted from the date of framing of the operational guidelines inasmuch as it could not apply and get the exemption due to non-framing of the operational guidelines. It has been claimed that no sales tax can be demanded from it till March 31, 1991 and that the impugned assessment orders are illegal and unsustainable. 16.. Mr. Mohanty, learned advocate appearing for the sales tax authorities, has sought to contend that the petitioner-company not being a new industrial unit, is not entitled to the benefits of deferment/exemption of sales tax provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oan under the 1980 policy. Only condition for obtaining the benefit of sales tax incentives under Part III of the 1989 policy is that if the continuing units of 1980 policy have availed of the sales tax loan under the policy of 1980 they would have to surrender that sales tax loan within the time-limit prescribed in the operational guidelines/ instructions. All continuing units of 1980 policy as defined in the 1989 policy are entitled to the benefits of 1989 policy irrespective of the fact whether they got the benefits of sales tax loan under the 1980 policy or not. 18.. The contention that industrial units covered under Part III of 1989 policy are not entitled to the benefits envisaged by paragraph 7.1.5 or 7.1.6 is clearly contrary to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of 1989 policy. 21.. Under the 1980 policy the petitioner-company was entitled to get interest-free sales tax loan as provided, but it was liable to pay the sales tax. The petitioner-company is liable to pay sales tax till June 9, 1992. The period from April 1, 1991 to June 9, 1992 is not covered either by 1980 policy or by 1989 policy. 22.. The petitioner-company has submitted an application before the assessing officer for refund of sales tax, inter alia, on the ground that no sales tax was leviable in view of the benefits extended to the petitioner-company under the 1989 policy. On behalf of the sales tax authorities it has been submitted that the petitioner-company having realised sales tax from the dealers it cannot claim re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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