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TMI Blog2023 (6) TMI 752X X X X Extracts X X X X X X X X Extracts X X X X ..... he facts and in the circumstances of the Petitioner's case, the Tribunal was right in law in allowing the respondent's appeals and setting-aside the orders passed by the Assessing Authority as well as the First Appellate Authority? ii. Whether on the facts and in the circumstances of the Petitioner's case, the Appellate Tribunal was right in law in holding that the Respondent was eligible for exemption from payment of tax payable under the provisions of the KVAT Act 2003 especially in the background where no notifications have been issued in exercise of the powers conferred under Section 5(2) of the KVAT Act 2003 granting exemption? 2. Heard Shri. Jeevan J. Neeralgi, learned AGA for the Revenue and Shri. K. Mallaha Rao, lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion issued under the KVAT Act. 6. On appeal, the JCCT(A) [Joint Commissioner of Commercial Taxes (Appeals)] partly allowed assessee's appeal and confirmed the denial of exemption from payment under the KVAT Act. On further appeal, the KAT allowed assessee's appeal holding that assessee is eligible for exemption from payment of tax in view of the exemption notification issued under the provisions of KST Act. Aggrieved by the said order, Revenue has preferred this petition. 7. Shri. Jeevan J. Neeralgi, for the Revenue, submitted that: * the Government of Karnataka vide Notification [bearing No. FD 70 CSL 97(1)] dated 12.11.1999 granted exemption of the tax payable under the provisions of the KST Act in respect of sale of food and non-alco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avail the benefit of exemption. 11. We have carefully considered rival contentions and perused the records. 12. Undisputed facts of the case are, assessee is a tourism hotel unit and commenced its business in the year 2001. It was earlier registered under the KST Act and later under the KVAT Act. Assessee has obtained Exemption Certificate from the Commissioner of Tourism, Government of Karnataka. 13. Revenue's case is, in the absence of any notification issued under the provisions of the KVAT, assessee is not entitled for any exemption. 14. A perusal of Exemption Certificate dated March 25, 2003 makes it is clear that assessee is a registered Tourism Industry and is eligible for 100% tax exemption for a period of 7 years. The relevan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Section 8-A of the Karnataka Sales Tax Act. 1957 (Karnataka Act 25 of 1957), the Government of Karnataka hereby rescinds the Notification No. FD 70 CSL 97 (I). dated 12-11-1999, with effect from the 1st day of January, 2000, subject to the condition that such rescinding of the Notification shall not be applicable to dealers who have made investment in establishing a new tourism units and the incentives offered to whom are unaffected by the Government Order No. FD 303 CSL 99, dated 7-1-2000, as specified in the said Government Order" (Emphasis supplied) 16. The KAT in the impugned order has examined the above notifications and recorded thus in para 18: "18. On perusal of the exemption certificate given to the Appellant dated: 25.03 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that rescinding of the Notification dated November 12, 1999 shall not be applicable to the dealers who have made investment in establishment in a new tourism units and the incentives offered and committed by the Government shall not get affected. 18. In support of Revenue's contention, Shri. Neeralgi has placed reliance on Hotel Madhuvan Case. Paras 8 and 9 of the judgment read as follows: "8. In exercise of power under Section 5(2) of the Act the notification dated 18-4-2005 were issued providing exemption under Section 5(2) of the Act in respect of the new industrial units as mentioned in the above notification. The same is in conformity with the provisions of the KVAT Act. The exemption is granted to new industrial units. The p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7, 2000 discontinuing sales tax based incentives, the same has been clarified vide Notification dated July 17, 2007 to the effect that the notification dated January 07, 2000 shall not affect the dealers who have made investment in establishing new tourism units. This question was not under consideration in Hotel Madhuvan Case. Therefore, the said authority does not lend any support to the contention advanced on behalf of the Revenue. 20. We may further record that even in the notification dated 07.01.2000 it is stated that the discontinuation shall not affect the incentives that have been already offered or committed by the Government until the eligibility of such incentives are completed. The eligibility certificate was valid for 7 years ..... X X X X Extracts X X X X X X X X Extracts X X X X
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