2002 (3) TMI 904 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Eligibility certificate issuance date under the Dispersal of Industries Packaging Scheme of Incentive, 1993.
2. Applicability of the amendment to the 1993 scheme to the petitioner's case.
3. Delay in processing the eligibility certificate by the sales tax authorities.
4. Entitlement to benefits under the eligibility certificate from the date of commercial production.

Issue-wise Detailed Analysis:

1. Eligibility Certificate Issuance Date:
The primary issue was whether a manufacturer could receive an eligibility certificate from a date other than the date of commercial production under the 1993 scheme. The scheme stipulated that the eligibility certificate would be issued after the commencement of commercial production, based on documentary evidence. The implementing agency's decision would be final and binding, and the Commissioner of Sales Tax would endorse the certificate, specifying the date of effect for sales tax incentives.

2. Applicability of the Amendment to the 1993 Scheme:
The Government of Maharashtra amended the 1993 scheme on March 23, 2000, stating that the effective date of the eligibility certificate should be from the date of commercial production. The petitioners argued that their case should be considered under the amended scheme since their application was pending when the amendment was made. The respondents contended that the amendment applied only to pipeline cases and not to the petitioner's case, as SICOM had processed their application before the amendment.

3. Delay in Processing the Eligibility Certificate:
The petitioners complied with all formalities and submitted their application on September 3, 1998, after starting commercial production on July 5, 1998. Despite SICOM forwarding the case to the sales tax authorities on December 16, 1999, the eligibility certificate was delayed. The sales tax authorities insisted on the payment of sales tax up to November 30, 1999, before issuing the certificate. The court found no justification for the delay and criticized the sales tax authorities for withholding the application without reason.

4. Entitlement to Benefits from the Date of Commercial Production:
The court noted that under the 1993 scheme, there was no bar on making an application after the commencement of commercial production. The petitioners were entitled to the eligibility certificate from the date of commercial production, as similar cases decided by the Sales Tax Tribunal had established this precedent. The court held that the petitioners' application should be treated as a pipeline case under the amended scheme, entitling them to benefits from the date of commercial production.

Conclusion:
The court ruled in favor of the petitioners, directing the respondents to issue the eligibility certificate effective from September 3, 1998, the date of the application. The court emphasized that the issue of granting eligibility certificates prior to the application date under the 1993 scheme remained open. The petition was allowed, and the respondents were ordered to grant all consequential reliefs and entitlements under the 1993 scheme without any costs.