New User   Login      
Tax Management India .com TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (9) TMI 465 - PUNJAB AND HARYANA HIGH COURT

2016 (9) TMI 465 - PUNJAB AND HARYANA HIGH COURT - [2016] 95 VST 402 (P&H) - Issuance of eligibility certificate - manufacture of cattle feed - tax incentives - Section 13-B of the Haryana General Sales Tax Act, 1973 - eligibility certificate - Rule 28-A of the Haryana General Sales Tax Act, 1973 - eligible industrial unit - Rule 28-A(2)(f) of the Rules - notional sales tax liability - Rule 28A (2)(n) of the rules - negative list not entitled to the benefits - benefit of purchasing raw material .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ity certificate is issued, in case specifically not mentioned in the negative list. - The quantum of benefit or type of benefit which the industrial unit may avail after issuance of eligibility certificate is a stage subsequent to the issuance thereof. As has already been referred to by the petitioner that in terms of notification issued by the Government, an eligible industrial unit availing exemption from payment of tax may be entitled to purchase goods without payment of tax. In the overa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on the ground that the petitioner is manufacturer of tax free goods cannot be legally sustained. - Petition allowed - issuance of eligibility certificate granted - decided in favor of petitioner. - C.W.P. No. 11835 of 2000 (O&M) - Dated:- 23-8-2016 - Mr. Rajesh Bindal and Mr. Harinder Singh Sidhu, JJ. For The Petitioner : Mr. Sandeep Goyal, Advocate For The Respondent : Ms. Mamta Singla Talwar, Deputy Advocate General, Haryana Rajesh Bindal, J. 1. This order will dispose of two petitions bea .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ture of cattle feed. The unit set up for the purpose came into commercial production on 23.5.1996. Section 13-B of the Haryana General Sales Tax Act, 1973 (for short, 'the Act') enables the State Government to provide for tax incentives. In exercise of powers conferred under the aforesaid provisions, Rule 28-A was inserted in the Rules. In terms of the aforesaid provisions, the petitioner applied for issuance of eligibility certificate vide application dated 19.8.1996, which was taken up .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

eas Rule 2(n) thereof defines notional sales tax liability. The ground on which the application of the petitioner for grant of eligibility certificate has been rejected is totally contrary to the provisions of Rules. The Rules contained a negative list specifying the products, the manufacturers of which are not entitled to the benefits under the Rules. The product of the petitioner is not mentioned therein. Even if on the product manufactured by the petitioner, there is no tax leviable on sale t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ich were to be used as raw material, some of which were tax free and some were taxable. 6. Learned counsel for the petitioner further referred to a communication dated 1.3.1993 from the Excise and Taxation Commissioner clarifying that the units manufacturing tax free products are entitled to benefit of exemption from tax. He further submitted that the aforesaid communication was superseded vide communication dated 31.7.1997 issued by the Commercial Taxation Commissioner. The Unit of the petition .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

(4)(a) of the Rules, in case of exemption, the benefit shall extend to tax on gross turnover and in the case of deferment, it shall extend to tax on the taxable turnover. Gross turnover has been defined in Section 2(gg) of the Act, whereas the taxable turnover has been defined in Section 2(p) of the Act. The assessment is framed as per Section 27 of the Act, which initially starts from gross turnover, which includes even the goods which are tax free. He further submitted that at the stage of iss .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ny benefit. She further submitted that Section 28A(4)(a) of the Rules provides that the benefit for the purpose of arriving at the limit of tax exemption/ deferment, the notional tax liability is to be considered, which means amount of tax payable on sale of that product. Once there is no tax payable on the furnished product, there is no use in issuing the eligibility certificate. The idea behind the scheme was to give exemption from payment of tax on sales and not on purchases. As per item 66 i .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the petition was not maintainable. 9. To this argument of learned counsel for the State, learned counsel for the petitioner submitted that the communication dated 31.7.1997 was not in response to the clarification sought by the petitioner as the letter written by the petitioner seeking clarification itself was dated 31.7.1997. He further submitted that clarification dated 31.7.1997, as has been referred to by learned counsel for the State was not communicated to the petitioner therein. 10. Hear .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

vely or retrospectively and subject to such conditions as may be prescribed. Rule 28A(2)(f) of the Rules (f) '"eligible industrial unit" means:- (i) a New Industrial unit or expansion or diversification of the existing unit, which - (I) has obtained certificate of registration under the Act; (II) is not a public sector undertaking where the Central Government held 51% or more shares; (III) is not availing the incentive of interest free loan from the Industries Department for invest .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

y the High Powered Committee for the grant of fiscal relief either in the form of exemption from the payment of sales tax or purchase tax or both or deferment of tax. xx xx xx Rule 28A (2)(n) of the Rules- (n)- "notional sales tax liability" means - (i) amount of tax payable on the sales of finished products of the eligible industrial unit under the Local Sales Tax Law but for an exemption computed at the maximum rates specified under the Local Sales Tax Law as applicable from time to .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the basis that the sales are eligible to tax under the said Act. Explanation: The branch transfers or consignment sales outside the State of Haryana shall be deemed to be the sale in the course of inter-State trade or commerce. Note: The expression and terms, if any appearing in this rule not defined above shall unless the context otherwise requires carry the same meaning as assigned to them under the Act and rules made thereunder. xx xx xx Rule 28A(4)(a) (4)(a) Subject to other provisions of th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tax on the taxable turnover of goods manufactured by the unit : xx xx xx Explanation 1: For the purpose of arriving at the limit of tax exemption/deferment, the national sales tax liability of the unit shall be taken into consideration. Notification dated 30.12.1987 LIST OF GOODS TAXABLE AT FIRST STAGE IN HARYANA (AS ON UPTODATE) Notn. No. S.O. 156/H.A.20/73/S.18/87 Dated 30th Dec. 1987 In exercise of the powers conferred by section 18 of the Haryana General Sales Tax Act, 1973 and all other po .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

. 38. to 82. xx xx SALES TAX RATES IN HARYANA W.E.F. 4th March, 2000 (As amended upto date) Sr. No. Description of goods Rate of tax (in percentage) 1. 2 . 3 . 1 to 137 xx xx 138. Goods leviable to tax at the stage of first sale when sold to a registered dealer who is availing exemption from tax under the industrial policy of the State Government, for the purpose of use in manufacture or processing of goods by him for sale or for the purpose of use in packing in the goods manufactured or process .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

se of use in packing of the goods manufactured or processed by him subject to furnishing a declaration in form STD-4 appended to this notification, by him. Nil 28. to 80. xx xx SCHEDULE- B (See Sections 6 and 15) Sr. No. Description of goods Conditions and Exceptions 1. 2 . 3 . 1 to 66 xx xx 67. Cattle feed, that is to say, a mixture of rice polish, rice bran deoiled, gram churi, mustard extraction, molasses, barley, sprout, salt, mineral mixture, urea and damaged wheat. 68 to 82. xx xx 12. The .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

pted from payment of sale tax, hence, not entitled to issuance of eligibility certificate. Reference was also made to the communication received from Commercial Taxation Commissioner dated 31.7.1997. The opinion of the Higher Level Screening Committee was also in the same terms. 13. Section 13-B of the Act empowers the State Government to exempt any class of industry from payment of tax in the interest of industrial development of the State. Prior to the amendment in Section 13-B of the Act vide .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d, which are: (i) Registered under the provisions of the Act; (ii) is not a public sector undertaking in which Central Government holding is 51% or more share; (iii) is not availing the incentives of interest free loan from the Industries Department for investment after 1.4.1988; (iv) is not included in Schedule III appended to these rules except the tiny units set up in a rural area on or after 1st April, 1992, in which capital investment in plant and machinery including market price of plant a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

h is defined as negative list in Rule 28A(2)(o) of the Rules. As per the definition of eligible industrial unit, any manufacturer of the products as mentioned in Schedule- III is not entitled to the benefits envisaged under Rule 28A of the Rules. The Schedule-III as applicable on the relevant date is extracted below:- Serial No. Industries/class of industries 1. Oil expellers (including units set up under Rural Industries Scheme) 2. Dall Mills and Rice Mills (including units set up under Rural I .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

le fabricated items like trunks, buckets, gamlas, windows, grills, trussess, etc. 10. Ethanol (Ethyl Alcohol) based industries except nonmolasses alcohal industries. 11. Khandsari units 12. Bricks made of ordinary earth including mechanized bricks where the ordinary of earth content is more than 50%. 13. Thinners. 14. Induction and ARC Furnance with more than 0.5 MT capacity. 15. AAC/ ACSR conductors. 16. L. P. Gas cylinders 17. Non-graded C.I. Casting. 18. Roller Flour Mills. 19. Re-rolling of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on spinnig mill (except units set up in Hisar and Sirsa Districts) 30. Fertilizer (Nitrogen Phosphate). 31. Sugar. 32. Cement. 33 Alluminium (Primary stages). 34. Thermal Power 35. Oil Refinery. 36. Sulphuric acid. 37. Tanneries. 38. Copper Smelter. 39. Zinc Smelter. 40. Iron and Steel (Primary stage) 41. Pulp and paper 42. Dyes and Dye intermediates. 43. Pesticides manufacturing and formulations. Note: -1: The above list shall not be applicable to the industrial units set up under the Rural Ind .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

erected at site and have been paid for. The anticipated cost of the project will be taken on the basis of documents furnished to a financial institution or banks for drawing a loan and which have been accepted by the financial institution or bank concerned for sanction of loan. 17. A perusal of the aforesaid list shows that the neither the product being manufactured by the petitioner, namely, cattle feed, nor the unit engaged in manufacturing of tax free products, is mentioned therein. Meaning .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he txable turnover and there being no taxable turnover of the petitioner, it is exercise in futile to issue him eligibility certificate, is merely to be noticed and rejected, for the reasons that the quantum of benefit or type of benefit which the industrial unit may avail after issuance of eligibility certificate is a stage subsequent to the issuance thereof. As has already been referred to by the petitioner that in terms of notification issued by the Government, an eligible industrial unit ava .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version