TMI Blog2005 (9) TMI 664X X X X Extracts X X X X X X X X Extracts X X X X ..... stings and steel fabrication situate at F-23, Section 17, Kavi Nagar Industrial Area, Ghaziabad. Being a new unit, the petitioner applied for eligibility certificate under section 4-A of the U.P. Trade Tax Act (hereinafter referred to as the Act ) under the notification no.780 dated 31st March 1995 and notification no. 781 dated 31st March, 1995 under section 4-A of the Act both for exemption under the U.P. Trade Tax Act and Central Sales Tax Act. The Divisional Level Committee issued an eligibility certificate no.5053 dated 28th January, 2000 granting exemption for a period of eight years from the date of first sale i.e. from 15th September, 1998 to 14th September, 2006. The petitioner contended that in the exemption application moved under section 4-A of the Act, the petitioner has specifically requested for the grant of eligibility certificate in respect of trade tax exemption under the deferment scheme. According to the petitioner after the receipt of the eligibility certificate dated 28th January, 2000, it moved an application to the Commissioner of Income Tax, U.P., Lucknow for the grant of moratorium under section 8 (2-A) read with rule 43 which was received in the office o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed for the balance period excluding the period during which exemption under section 4-A of the Act has been availed from February, 1999. In support of his contention he relied upon the decisions in the case of Minda Switch Auto Ltd., Delhi Versus State of U.P. and others reported in 1992 UPTC 1004 and CST Versus Industrial Coal Enterprises reported in 1999 UPTC 250. He further submitted that too hyper-technical or legalistic approach should be avoided in looking at a provision, which must be equitably interpreted and justly administered. In support of his contention he relied upon the decision in the case of Saroj Aggarwal Versus Commissioner of Income Tax, U.P. reported in (1985) 156 ITR 497. Learned Standing Counsel has brought to the notice of the court through second supplementary affidavit dated 9.11.2004 the copies of the returns in Form-4 relating to the U.P. sale and Form No.1 relating to the Central sale for the period September, 1998 to February, 1999. He referred the returns filed by the petitioner for the aforesaid months and submitted that in the returns for the month of September, 1998 to January, 1999, the petitioner has claimed the exemption on the sale turn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fty percent of the fixed capital investment mentioned in the eligibility certificate; (3) the moratorium for payment of tax admittedly payable for each of the assessment years may be granted for a period of five years the computation of which shall be done from the last date for furnishing the last return according to sub-rule (1), (2) or (3) of Rule 41 for the assessment year concerned. The amount of tax admittedly payable for each assessment year shall be paid by the manufacturer in a lump sum within one month of the expiry of the period of moratorium; (4) the moratorium shall cease and the total amount of the tax admittedly payable shall become payable- (a) on the date of discontinuance of business where the manufacturer discontinues business, within the meaning of sub-section (1) of Section 18 of the Act, (b) on the date on which the unit becomes ineligible for exemption under section4-A, and the amount shall be paid in lump sum within three months of its so becoming payable; (5) the facility shall not be admissible in respect of the amount of tax assessed in excess of the tax admittedly payable by the manufacturer on the turnover admitted by him in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iod 15th September, 1998 to 19th February, 1999 has not realised any tax. This shows the intent not to avail the benefit under the deferment scheme. Moreover, in the returns in Form No.4 and Form No.1 both relating to U.P. sale and Central Sale respectively, the exemption has been claimed on the turnover of the manufactured goods under section 4-A of the Act. This clearly shows that the petitioner has availed the facility of exemption under section 4-A of the Act and therefore, in view of sub-rule (8) of Rule 43, the petitioner is not entitled for the grant of moratorium which has been rightly refused. Similar question came up for consideration before the Division Bench of this Court in the case of Bindal Batteries Versus State of U. P (supra). In the said case also the claim of moratorium has been refused because the dealer had availed the benefit of exemption under section 4-A of the Act for certain period. This Court upheld the denial for grant of moratorium under section 8 (2-A) of the Act in view of Rule 43 (8). This Court held as follows: It is first principle of interpretation that the statute should be read in its ordinary, nature and grammatical sense. As observed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e no application. Sri Rajes Kumar learned Counsel for the petitioner has relied on the decision of this Court in Minda Switch Auto Ltd., Delhi V. State of U.P. and others 1992 UPTC 1004. In that decision there is no reference to Rule 43 (8) of the U.P. Trade Tax Act at all, and hence the same is distinguishable. Moreover, in that decision reliance was placed on the Notification dated 28th December, 1989 which stated that even if the Unit has availed of the benefit under Section 4-A and an Eligibility Certificate has been granted to it, the benefit under Section 8 (2-A) can still be extended to it though it will be for the unexpired period for which exemption was granted under Section 4-A. This position was not disputed by the learned Standing Counsel, in that case in which the above observation was made. Moreover, the aforesaid Notification is not applicable to the present case as the petitioner's Unit was established after 31st March, 1990. Sri Rajes Kumar then submitted that in the present case the petitioner availed of the eligibility certificate dated 21st May, 1996 from 12th December, 1995 to 31st March, 1996, i.e., before it was granted. Copy of the eligibility cer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivate Ltd. Versus State of U.P. and others reported in 1999 UPTC 713, the issue involved was different. The issue involved before the Court was whether under section 8 (2-A) of the Act, moratorium should be allowed for the period of eight years of five years. There was no question for consideration that if the exemption under section 4-A of the Act has been availed, the dealer was entitled for moratorium in view of Rule 43 (8). It is true that the provision should be interpreted in a purposive manner to achieve the object of the Section. Perusal of Section 8 (2-A) of the Act shows that the grant of moratorium is in lieu of exemption under section 4-A of the Act. Therefore, it is open to the unit either to opt for exemption under section 4-A of the Act or for moratorium. Under Rule 43 (8) it has been specifically provided that in case if the exemption under section 4-A of the Act has been availed, dealer is not entitled for the grant of moratorium. The language of Rule 43 (8) is clear and unambiguous. For the reasons stated above, we are of the considered view that there is no infirmity in the order passed by the Commissioner of Trade Tax, which is accordingly upheld. In th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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