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2011 (2) TMI 1336 - HC - VAT and Sales TaxBenefit of tax concession of 888.15 lacs given to the petitioner under rule 28C of the Rules has been cancelled on the ground that the petitioner did not have the requisite registration with the Department of Industries which was a condition precedent for grant of benefit by treating the unit to be unit in pipeline Held that - Cancellation of tax concession was not justified. In any case the HLSC was required to reconsider the matter in the light of stand of the Central Government that the petitioner had applied to the SIA prior to April 30 2000. Learned counsel for the State of Haryana fairly states that the matter may have to be reconsidered. Thus we set aside the impugned order dated June 7 2007 and remand the matter to the Higher Level Screening Committee for passing a fresh order in accordance with law.
Issues:
Quashing of tax concession order under Haryana General Sales Tax Rules, 1975 based on registration requirements for industrial units. Analysis: The petition sought to quash an order canceling a tax concession granted to the petitioner under rule 28C of the Haryana General Sales Tax Rules, 1975. The cancellation was based on the petitioner's alleged lack of registration with the Department of Industries, a prerequisite for the tax benefit. The petitioner's unit, established in collaboration with foreign partners for manufacturing automobile components in Gurgaon district, claimed eligibility as a "unit in pipeline" for tax concessions. The petitioner was registered with the Sales Tax Department and had approvals from the Secretariat of Industrial Assistance (SIA) and the Department of Industries. The petitioner's case hinged on meeting the conditions for units in pipeline, including registration by April 30, 2000, which it claimed to have fulfilled through applications and approvals. The Higher Level Screening Committee (HLSC) initially granted the tax concession, but later revoked it citing the petitioner's alleged lack of registration on the relevant date. The initial writ petition favored the petitioner on the grounds of non-withdrawable benefits, but the Supreme Court overturned this decision. The Supreme Court directed a review of the registration requirements under rule 28C(o) of the Rules, leading to the impleadment of the Union of India in the case. The Union of India clarified the timeline of approvals and acknowledgments related to the petitioner's unit, indicating potential registration before the cutoff date of April 30, 2000. This clarification prompted a reconsideration of the matter by the State of Haryana. In light of the arguments presented, the court set aside the order canceling the tax concession and remanded the case to the HLSC for a fresh decision based on the revised understanding of the registration requirements. The petitioner was given the opportunity to submit additional evidence within a specified timeline, and the HLSC was directed to make a new determination within three months. The judgment disposed of the petition, paving the way for a reevaluation of the tax concession eligibility based on the clarified registration timeline and requirements.
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