2009 (8) TMI 1091 - HC - VAT and Sales Tax

Summary

Issues involved:
Entitlement to exemption from payment of additional sales tax under section 5D of the Kerala General Sales Tax Act based on a certificate of exemption issued under Government Notification S.R.O. No. 1729/1993.

Analysis:
The petitioner, a small-scale industrial unit, sought exemption from additional sales tax under section 5D of the Act based on a certificate of exemption issued under a government notification. The assessing officer granted exemption from sales tax for a specific period but demanded additional sales tax separately. The Government Pleader argued that the additional sales tax was a separate levy and not covered by the exemption certificate. However, the petitioner contended that the liability under section 5D was tax on tax payable on the sales turnover and hence should be covered by the exemption. Reference was made to a Supreme Court decision regarding a similar issue, but it was held that the petitioner could claim exemption based on the notification and certificate issued. The notification also granted exemption to new SSI units on surcharge payable by them, and it was noted that the additional sales tax was introduced after the abolition of certain acts. The court held that the petitioner was entitled to exemption under the certificate on the additional tax payable under section 5D, which would be set off against the eligible amount of sales tax exemption granted.

The judgment allowed the original petition, directing the respondents to grant exemption on the additional sales tax payable under section 5D to the petitioner and set off the same against the amount certified for tax exemption. An order on a related matter was dismissed.