1994 (4) TMI 367 - HC - VAT and Sales Tax

Summary

Issues:
Jurisdiction of assessing authority to cancel eligibility certificate under Rajasthan Sales Tax Incentive Scheme, 1987.

Analysis:
The petitioner established an industrial undertaking in an industrial backward area, engaging in various activities such as stone cutting, polishing, edible oil, oilcakes, pulses, and dals. The petitioner obtained eligibility certificates under the Rajasthan Sales Tax Incentive Scheme, 1987 for these activities. However, the assessing authority issued notices to the petitioner, questioning the validity of the eligibility certificates and seeking to cancel them. The assessing authority alleged that the certificates were wrongly granted by the District Level Screening Committee. The respondent contended that the petitioner was not entitled to tax exemption under the scheme. The jurisdiction to determine eligibility for tax exemption lies with the Screening Committee, not the assessing authority.

The Court observed that the assessing authority exceeded its jurisdiction by attempting to cancel the eligibility certificates based on its opinion that they were wrongly granted. The authority should have raised its concerns with the Screening Committee, which has the power to address such issues. The Court emphasized that the assessing authority cannot unilaterally cancel eligibility certificates without proper procedure. The notices issued by the assessing authority were deemed to be without jurisdiction and were quashed.

The petitioner informed the Court that the District Level Screening Committee had partially cancelled the eligibility certificate post the filing of the writ petition. The petitioner indicated pursuing a separate remedy for this partial cancellation through another writ petition. The Court clarified that its decision in the current case would not impact the separate proceedings concerning the partial cancellation of the eligibility certificate by the Screening Committee. The Court allowed the petition, quashed the notices, and ensured that its ruling would not affect any ongoing legal actions related to the partial cancellation of the certificate.