9911796707
TMI Blog2006 (3) TMI 701X X X X Extracts X X X X X X X X Extracts X X X X ..... d August 12, 1999 rejected the application. The applicant filed appeal before the Tribunal. The Tribunal vide order dated February 14, 2000 set aside the order and remanded back the matter to the Divisional Level Committee to decide the application after giving opportunity of hearing to the applicant. The Divisional Level Committee again rejected the application on November 18, 2002. Against the said order, the applicant filed appeal before the Tribunal, which was allowed vide order dated February 19, 2003 and the matter was again remanded back to the Divisional Level Committee to pass a speaking order after considering all the materials available on record. The Divisional Level Committee vide order dated February 21, 2004 again rejected the application and against the order, the applicant filed appeal before the Tribunal which has been rejected by the impugned order. Against the said order, the applicant filed Revision No.1020 of 2004 in this court. This court vide order dated February 3, 2005 allowed the revision and directed the Tribunal to decide the appeal afresh and in pursuance thereof, the present appeal has been decided. Heard learned counsel for the parties. From the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harge its burden as required by Explanation (2A) to section 4A of the Act. Against the said order, applicant filed appeal before the Tribunal, which has been rejected, vide order dated April 7, 2004. Against the said order, the applicant filed revision, which was allowed, and the matter was remanded back to the Tribunal with the following observations: "I have perused the order of Tribunal and the Divisional Level Committee. Tribunal is the last court of fact and is expected to consider the material available on record and the submissions made by both the parties. It appears that the Tribunal while coming to the conclusion that the machines purchased by the applicant from M/s Universal Traders, Gokulpura, New Delhi, were old, the survey made by the Assistant Commissioner, Trade Tax, report of General Manager, District Industries Centre and the certificate of bank certifying the loan given for new plant and machinery, the affidavit, etc., have not been considered and therefore, the order of Tribunal is vitiated. It is true that the burden lies upon the applicant to prove that the machinery installed in the unit were not used or acquired for use in any of the factory or worksho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stalled in the appellant-unit have been valued by the chartered accountant, namely, M/s.Nagar Acharya & Associates, New Delhi, who after examining the books of account of the appellant-units also the documents relating to the plant and machineries has valued the same to the tune of Rs.25,04,121.10 by treating them to be 'new one'. The price of the plant and machinery purchased from M/s.Universal Traders, Delhi, has been paid by means of bank draft/cheques. In spite of aforementioned evidence being there, the learned DLC has rejected the review petition dated August 25, 1999, moved by the appellant on altogether irrelevant grounds. The aforementioned evidence was sufficient to establish the fact that the plant and machineries installed in the appellant-unit were neither used nor acquired for use in any other unit and thus, by the said evidence the burden of the appellant-unit to establish the fact that the plant and machineries installed therein were neither used nor acquired for use in any other unit, was satisfactorily discharged. The finding recorded by the learned DLC in its order dated February 21, 2004 for coming to the conclusion that the machineries installed in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the dealer and the document filed by the dealer cannot be ignored and the machineries cannot be held to be old without making proper inquiry. It is further submitted from the side of the appellant that it is not necessary for any supplier of the goods to sell or supply only those very goods which are manufactured by it and further the supplier can sell or supply the goods after purchasing from manufacturer thereof or after getting those goods fabricated. It is also submitted that M/s.Universal Traders, Delhi, was assessed for the year 1998-99 by order dated December 1, 1998 passed by the learned assessing authority under section 23 of the Delhi Sales Tax Act, 1975 which shows that during the said year M/s.Universal Traders, Delhi had shown its turnover to the tune of Rs.24,97,372.30. The disclosure of the aforesaid turnover is itself an evidence of the fact that it was manufacturing the goods in the said years as aforesaid manufacture of the goods was not possible without machineries. Since the appellantunit had purchased the machines in the year 1997 and the supplier firm M/s.Universal Traders, Delhi, continued to manufacture the goods in its unit during the year 1998-99, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not be concluded that machineries installed in the unit of the appellant were old ones or previously used in the unit of M/s.Universal Traders, Delhi. Further it is submitted by the appellant's counsel that only on account of the fact that the sale of machineries to the appellant-unit was not shown by M/s.Universal Traders in its returns submitted in the Sales Tax Department, Delhi, neither any doubt over the aforesaid transaction of purchase/sale could be raised there nor it could be inferred that in fact old machineries were sold by M/s.Universal Traders, Delhi, to the appellant-unit because it was not for the appellant-unit to ensure the fact as to whether the sale of machineries to the appellant-unit has been shown or not by the seller M/s.Universal Traders in its returns for the relevant year, and for the aforesaid lapse on the part of the seller, M/s.Universal Traders, the appellantunit could not be blamed under the law. In support of the aforesaid contentions appellant's counsel has referred to the decision given by a Full Bench of Tribunal in the case of Supreme Caps Industries Ghaziabad v. D.L.C., Meerut [2003] 22 NTN 1, principles laid down wherein have been sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... NTN 889, Agarwal Iron & Steel Co.v.Commissioner of Trade Tax, U.P. [2005] 37 STJ 151, Tribeni Motor Car Co.v.Commissioner of Sales Tax, U.P. [1983] STD 4, Mool Chand Daudayal v.Commissioner of Sales Tax [1985] 1 STR 364 and Raja Ram Ram Prakash v.Commissioner of Sales Tax [1987] 5 STR 282. The appellant's counsel has submitted that the matter has already been remanded twice to the learned DLC and the entire material required for final disposal of the matter being available on the record, it would be proper to decide the matter finally by disposal of this appeal and not to remand it again to the learned DLC" On consideration of the aforesaid submissions, the Tribunal has recorded its finding as follows: "We have considered the submissions made by the learned representatives of the parties with reference to the material available on the records as also the case law cited during the arguments on this appeal. By the impugned order dated February 21, 2004, learned counsel has concluded that all the plant and machineries installed in the appellant-unit were previously used or acquired for use in the unit of M/s.Universal Traders, Delhi, and has recorded various reasons t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 998. On the strength of the above-mentioned facts no adverse inference could be drawn against the appellant-unit as the alleged purchase of machineries by the appellant-unit from M/s.Universal Traders, Delhi, was prior to the closure of M/s.Universal Traders as is evident from the above-mentioned facts themselves. The fourth reason assigned by the learned DLC is that all the machineries, accessories, components and equipment, etc., have been purchased from a single seller M/s.Universal Traders whereas no such manufacturer or seller is there in India dealing in entire plant and machineries required for installation of any factory. In our opinion the above-mentioned reason recorded by the learned DLC is not tenable under the law as it is not difficult or uncommon to acquire various machineries, plants, accessories, components, equipment and articles required for installation of a particular unit from various sources/sellers/manufacturers/fabricators and thereafter effect sale thereof. The fifth reason recorded by the learned DLC is that the appellant unit has purchased 3 P.V.C. extruder and one rubber extruder from M/s.Universal Traders. These machineries are very costly. A very ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplied by M/s.Universal Traders to the appellant-unit were previously used in the unit of the seller. Regarding above-mentioned ground taken by the learned DLC it has been already concluded by a Full Bench decision dated February 14, 2000 of this Tribunal in Appeal No.108/99 filed by the appellant that by mere perusal of import declaration form as well as sale voucher it cannot justifiably be held that the machineries are old ones. It may be added here that the bill enclosed with import declaration form No.3020631 is bearing the names of three items in column of 'description of goods' and below the last item, i.e., the item No.3, the boiler, there is a cutting of writing which is altogether illegible and any other material is not there on the said bill to conclude that the items mentioned therein were old ones. Admittedly the endorsement about the machineries being old on import declaration form No.3020631 was made by the check-post authorities. No evidence is there to establish the fact that any such endorsement about the machine, the machineries being old was made by the seller M/s.Universal Traders on the said import declaration form. In view of this situation on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... strong and the confidence howsoever strange cannot take place of legal proof'. According to the provisions of section 4A of the Act, for availing the benefit of exemption thereunder, it was required to be proved that the machineries and plant, equipment, apparatus or components installed in the unit were neither previously used nor acquired for use in any other unit and the burden to prove the aforesaid fact lies on the unit claiming exemption under the provisions of section 4A of the Act. Now we have to see as to whether and how far the appellantunit has succeeded in discharging the aforesaid burden. It appears from the letter dated September 9, 1997 issued by the Oriental Bank of Commerce, Kavi Nagar, Ghaziabad, that the appellant-unit was sanctioned a loan of Rs.18,00,000 only on the strength of plants and machineries installed therein. It further appears from the report dated August 6, 1998 of the authorities of DLC, Ghaziabad, that after physical verification and checking of the entire plant and machineries of the appellant-unit, it was found by them that those machineries were neither used nor acquired for use in any other unit. It also appears from the report dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not the substantive evidence. In our considered opinion the substantive, basic, primary and the best evidence in this connection could have been the bills/vouchers/invoices issued by M/s.Universal Traders, New Delhi, in connection with the alleged sale of plants and machinery to the appellant-unit and the oral evidence if any, in support thereof. Since it is an undisputed fact that the alleged seller M/s.Universal Traders was neither manufacturer nor dealer of the plants and machinery said to have been sold by it to the appellant-unit, therefore, a reasonable suspicion could be there regarding genuineness/truthfulness of the aforesaid transaction of sale/purchase. Unless and until this suspicion was removed the aforesaid bills/vouchers/ invoice could safely be relied on. That suspicion could certainly be removed by making an enquiry regarding the fact as to when and from whom the machineries said to have been sold to the appellant were acquired by the seller M/s.Universal Traders, New Delhi, and also by giving an opportunity in this connection to the appellant-unit to disclose and establish the aforementioned facts, but neither that enquiry has been held by the DLC nor the said op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted that the matter has already been remanded twice by the Tribunal to the DLC and once by the High Court to the Tribunal and this is the third remand by the Tribunal to the DLC. He submitted that this court in several cases has consistently held that the exemption matter under section 4A of the Act has to be decided on priority basis because it leads to serious consequences. Learned Standing Counsel relied upon the order of the Tribunal. Having heard the learned counsel for the parties, I have perused the order of the Tribunal and the authorities below. On the facts and circumstances of the case, I am of the view that the remand of the case to the DLC for further enquiry is patently illegal and erroneous. Explanation (2) to section 4A of the Act defining "new unit" established after March 31, 1990 reads as follows: "(2) 'new unit' after March 31, 1990, means a factory or workshop set up by a dealer after such date and satisfying the conditions laid down under this Act or Rules or notifications made thereunder with regard to such factory or workshop and includes an industrial unit manufacturing the same goods at any other place in the State or an indust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uting the machines as new have been considered by the Tribunal and have been found insufficient. Tribunal on consideration of the material also arrived at the conclusion that the evidence establishes that the machines were new ones and have not been used by any factory or workshop. In my opinion, after coming to the aforesaid conclusion, there was no justification for asking further enquiry and remanding back the matter to the DLC. On the facts and circumstances of the case, I am of the view that the unit has discharged its burden in proving that the installed machines have not been used in any factory or workshop and there is no need of remanding the matter back to the DLC for further enquiry. In the circumstances, I direct the DLC to treat the unit as new unit and issue eligibility certificate under section 4A of the Act. Before parting with the case, I must express that the unit was established in the year 1997. Exemption was claimed for the period of eight years, which expired in the year 2005, but the issue relating to the exemption has not been finalised. The matter has already been remanded by the Tribunal to Divisional Level Committee twice and this is the third remand mad ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
