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2012 (8) TMI 876 - HC - VAT and Sales TaxExtension to the period of exemption under Notification No. A-3-24-94-ST-V (108) dated October 6 1994 denied - Held that - Decision about the claim of the writ petitioner is to be taken by the State Government and not by the High Level Committee. The decision necessarily is required to be taken keeping in view the directions contained in the scheme sanctioned by the BIFR and also keeping in view the provisions of the SICA. However undisputedly no such decision has been taken so far by the State Government after the sanction of the scheme. It is also clear that the High Level Committee has not considered the petitioner s claim on the merits but has merely observed that the petitioner s claim cannot be considered by it for want of necessary powers/jurisdiction for the same. In the aforesaid circumstances we feel it necessary to issue directions to the State Government for taking appropriate decision on the petitioner s claim at the earliest on the basis of the scheme sanctioned by the BIFR keeping in view the provisions contained in SICA.
Issues:
Challenge to order refusing exemption extension under Notification, Consequential assessment orders refusal, Interpretation of SICA provisions, Jurisdiction of High Level Committee, State Government's role in decision-making. Analysis: The judgment involves a limited company challenging the refusal to extend exemption under Notification A-3-24-94-ST-V dated October 6, 1994, despite directions from BIFR in a scheme for revival/rehabilitation. The petitioner also contested assessment orders denying exemption under M.P. Value Added Tax Act, 2002, and Central Sales Tax Act, 1956, due to lack of eligibility certificate. The petitioner argued that demands based on these assessments were unenforceable during scheme implementation under section 22 of SICA. The petitioner, engaged in solvent extraction, had a unit at Dewas and was registered under State and Central sales tax laws. Initially granted an eligibility certificate for exemption from tax, the petitioner's unit became non-operative, leading to a failed extension request to the State Level Committee and Cabinet Committee. Subsequently, after becoming a sick industrial company, the petitioner sought reconsideration through the Ministry of Commerce Industries and Commercial Tax Department. Upon being declared a sick industrial unit by BIFR, the petitioner's revival/rehabilitation scheme was sanctioned on October 4, 2007, directing an extension of exemption period for various taxes. The petitioner argued that the BIFR's directions were binding on State authorities and Commercial Tax Department under SICA section 19, challenging the High Level Committee's decision of October 11, 2010. The High Level Committee declined relief, stating jurisdiction lies with the State Government, not them. The court noted that the State Government had not made a decision post-scheme sanction and directed them to decide on the petitioner's claim promptly, considering BIFR's directions and SICA provisions. The court emphasized that the State Government should not be influenced by the Assistant Commissioner's stance against following BIFR's revival scheme guidelines. The court ordered the State Government to decide on the petitioner's claim expeditiously, within four months, based on the BIFR scheme, while halting coercive actions on the petitioner regarding the assessment orders until a decision is made. The judgment underscores the importance of adhering to BIFR's directions and SICA provisions in decision-making related to industrial revival schemes.
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