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TMI Blog2003 (4) TMI 516X X X X Extracts X X X X X X X X Extracts X X X X ..... ied the prescribed condition under rule 25-A of the Rules. The petitioner was exempt from payment of tax. The petitioner is recognised by the Commissioner of Commercial Taxes as a village industry and granted recognition certificate in terms of the Rules. Rule 25-A of the Karnataka Sales Tax Rules (now rule 24) lays down conditions and limitations that are to be satisfied for prescribed village industries to be eligible for exemption from levy of tax under the K.S.T. Act. Rule 25-B(3), as it then stood, made provisions for the Commissioner of Commercial Taxes for grant of certificate of recognition. The petitioner is having a certificate. Sub-rule (3) of rule 25-A (now rule 24(3) was introduced by Notification No. FD 39 CSL 96 dated May 8, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lier rule 25-A(1)(2)(3) provides for recognition. Rule 25A reads as under: "25-A. The village industries for the purpose of serial Number 28 of the Fifth Schedule.-The village industries for the purposes of Serial No. 28 of the Fifth Schedule shall be as specified in column (2) of the Table below, subject to the condition that, (1) in the case of village industries existing on 17th February 1984; (a) the total investment on plant and machinery at any given time does not exceed rupees one lakh; and (b) the annual sales turnover thereof does not exceed rupees ten lakhs. (2) in the case of village industries established after 17th February 1984; (a) the industry is situated within the limits of a village or town, whose population as per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urts have very little say in the matter. The argument of discriminatory is no doubt attractive but the said attraction gets dissolved once we go to the root of the matter. Rs. 10 lakhs and Rs. 20 lakhs has been fixed taking into consideration the fall in rupee value in subsequent years. What was Rs. 10 lakhs in 1984 in terms of rupee value is much more than Rs. 20 lakhs in the year 1996. In the matter of exemption Government can fix its own yardstick taking into consideration various aspects of the matter. A mere enhancement of turnover by itself after 1996 in my view cannot by itself violate article 14 of the Constitution of India. But however if exemption is in violation of any constitutional provision, the court can step in and prevent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sition in the society to put it at the highest is no higher than that of others who in other walks of life have the same income. For the purpose of valid classification what is required is not some imaginary difference but a reasonable and substantial distinction having regard to the purpose of the law." (Underline is mine) 6.. The Supreme Court in the case of Shashikant Laxman Kale v. Union of India in [1990] 185 ITR 104 has noticed the scope of article 14 in the following words: Here italicised. "It is well-settled that the latitude for classification in a taxing statute is much greater; and, in order to tax something, it is not necessary to tax everything. In order to see whether classification in a particular taxing provision is valid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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