1996 (3) TMI 488 - AT - VAT and Sales Tax

Summary

Issues:
1. Application under section 8, Rajasthan Taxation Tribunal Act, 1995 for compliance with the State Level Screening Committee's order.
2. Delay in issuing eligibility certificate under the Rajasthan Sales Tax Incentive Scheme for Industries, 1987.
3. Imposition of penalty under section 22A(7) of the Rajasthan Sales Tax Act, 1954.
4. Review application filed by the respondent before the State Level Screening Committee.
5. Interpretation of clause 7(e) of the Sales Tax Incentive Scheme for Industries, 1987.
6. Jurisdiction of the Tribunal under section 8 of the Rajasthan Taxation Tribunal Act, 1995.

Analysis:

The case involves an application filed under section 8 of the Rajasthan Taxation Tribunal Act, 1995, seeking direction for the Commercial Taxes Officer to comply with the State Level Screening Committee's order to issue an eligibility certificate under the Rajasthan Sales Tax Incentive Scheme for Industries, 1987. The petitioner, an industry established in Bhiwadi, invested over Rs. 8 crores and applied for exemption from sales tax in June 1994. Despite the Committee's order in September 1994, the certificate was not issued, leading to subsequent penalties and appeals against tax evasion charges.

The respondent filed a review application before the State Level Screening Committee, citing the petitioner's evasion of tax and pending appeals against imposed penalties. The petitioner contended that the review application was neither filed nor decided within the Scheme's specified time limits, emphasizing the mandatory nature of such provisions. However, the Tribunal highlighted clause 7(e) of the Scheme, which disallows benefits if penalized for tax evasion, regardless of procedural delays or review application timelines.

The Tribunal, vested with extraordinary jurisdiction under the Act, dismissed the application considering the petitioner's penalization for tax evasion, dismissed appeal by the Deputy Commissioner, and pending second appeal before the Tax Board. The Tribunal emphasized that the concessionary nature of the Scheme does not confer an absolute right to claim benefits, especially when penalized for tax evasion. Consequently, the Tribunal found it inappropriate to grant relief to the petitioner based on the circumstances and the provisions of the Scheme.

In conclusion, the Tribunal dismissed the application under section 8 of the Rajasthan Taxation Tribunal Act, 1995, without imposing any costs, based on the petitioner's penalization for tax evasion and pending appeals, which triggered the application of clause 7(e) of the Sales Tax Incentive Scheme for Industries, 1987.