2012 (11) TMI 1057 - HC - VAT and Sales Tax

Summary

Issues involved:
The petitioner challenged the assessment order and revisional order related to exemption from State and Central sales tax based on eligibility certificates for manufacturing formaldehyde, hexamine, and monoethylene glycol. The dispute arose regarding the production of hexamine in the main unit and expansion unit exceeding the installed capacity.

Assessment Proceedings:
The assessing authority initially restricted the exemption to the installed capacity of 750 MT for hexamine production and denied exemption for the excess production of 302.95 MT. The revisional authority remanded the matter back to the assessing authority to consider the eligibility certificate and relevant decisions, but the assessing authority maintained the original assessment order without proper consideration. The revisional authority affirmed the order without addressing the eligibility certificate granted to the petitioner, leading to an error in the decision-making process.

Legal Interpretation:
The petitioner argued that the authorities erred in restricting the exemption to the expansion unit's installed capacity, contrary to the exemption notification's provisions. The assessing authority failed to adhere to the remand order's direction, which required a fresh assessment considering the eligibility certificate and previous decisions. The oversight of key aspects by both the assessing and revisional authorities led to an incorrect affirmation of the assessment order.

Remand and Fresh Decision:
Considering the overlooked directions and legal provisions, the High Court set aside the assessment and revisional orders, remanding the matter to the assessing authority for a fresh decision. Emphasizing the importance of timely resolution, the court instructed the assessing authority to conduct the fresh assessment promptly and in compliance with the law, without unnecessary delays.

Conclusion:
In conclusion, the High Court disposed of the writ petition in favor of the petitioner, highlighting the necessity for a proper reconsideration of the exemption eligibility and production capacity issues in line with the legal framework and previous directives.