TMI Blog2004 (10) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... company is situated at Raipur and engaged in the business of manufacture of iron casting. As the petitioner-company suffered heavy losses, therefore, it approached the Board for Industrial Finance and Reconstruction (BIFR), established under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA), and was declared as sick industry vide order dated June 10, 1991. The BIFR sanctioned a rehabilitation package vide order dated September 27, 1996 (annexure P1) in exercise of its powers under section 18(4) read with section 19(3) of the SICA. The case of the petitioner is that this facility was granted in the package by the BIFR for a period of ten years commencing from September 27, 1996 to September 26, 2006. The b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st the petitioners without obtaining prior permission or sanction from the BIFR. 3.. Reply has been filed on behalf of the State-respondents in which it has been admitted that the rehabilitation scheme was sanctioned by the Board vide order dated September 27, 1996 and the erstwhile State of Madhya Pradesh was directed by the Board to declare the petitioner-company as "relief undertaking unit" for a period of ten years and also to defer the sales tax dues during that period. The erstwhile State of Madhya Pradesh declared the petitioner-company as relief undertaking unit for a period of seven years commencing from June 4, 1993 to September 30, 2000. After the formation of the State of Chhattisgarh with effect from November 1, 2000, the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order disposing of the application will be similar to granting final relief, therefore, this petition is being disposed of at the admission stage itself. 5.. I have heard learned counsel for the parties. 6.. Learned Senior Counsel appearing on behalf of the petitioners argued that as per the scheme at page 28, the Government of Madhya Pradesh was directed to waive the minimum penal and surcharge levied by the MPEB; to declare the unit as "relief undertaking" for a period of ten years; to defer the sales tax dues till the unit remains as "relief undertaking"; and to grant reliefs and concessions as above within one month of the date of sanction of the scheme. Therefore, for ten years, even the sales tax has been deferred and the res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion or a sanctioned scheme is under implementation or where an appeal under section 25 relating to an industrial company is pending, then, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956) or any other law or the memorandum and articles of association of the industrial company or any other instrument having effect under the said Act or other law, no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof and no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance gra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me legitimately belonging to the Revenue, cannot be and could not have been intended to be covered within section 22 of the Act. Any other construction will be unreasonable and unfair and will lead to a state of affairs enabling the sick industrial unit to collect amounts due to the Revenue and withhold it indefinitely and unreasonably. Such a construction which is unfair, unreasonable and against the spirit of the statute in a business sense, should be avoided." 10.. Therefore, in view of the above law laid down by the honourable apex Court the sales tax collected by the petitioner-company after the sanction of the scheme, i.e., September 27, 1996 the respondents are entitled to recover the sales tax from the petitioners and for recovery ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entitled to recover the sales tax, which has been collected by the petitioner-company after September 27, 1996. However, any sales tax collected prior to that stands deferred as per the sanctioned scheme dated September 27, 1996. 12.. Now, coming to the question as to how much amount is recoverable out of the total amount said to be recoverable as per the respondent's case i.e., Rs. 3,68,94,998. The total figures have been shown by the respondents in annexure R1 and as per their own admission, since 2000-01, the return submitted by the petitioners is pending for scrutiny and no assessment order has been passed. Therefore, in the circumstances, it is held that till 1999 up to which period the assessment has been made, the respondents are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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