2022 (8) TMI 1402 - HC - VAT and Sales Tax

Power of the State Governments to grant exemption under Section 8(5) is restricted only in respect of the transactions covered under Section 8(1) and not in respect of the transactions covered under Section 8(2) of the CST Act - HELD THAT - Similar issue decided in PRISM CEMENT LTD AKSHAY RAHEJA VERSUS STATE OF MAHARASHTRA, FINANCE DEPARTMENT OTHS. MUMBAI 2013 (7) TMI 668 - BOMBAY HIGH COURT where it was held that once it is held that the powers vested in the State Governments under Section 8(5) are not divested by the 2002 amendment and that even after the 2002 amendment, the State Governments subject to compliance of Section 8(4) have power to grant exemption in respect of transactions covered under Section 8(1) as also under Section 8(2), no reason to consider the second and the alternative argument of the petitioners that Section 8(5) as amended by Finance Act 2002 does not affect the rights vested in the petitioners under PSI 1993 to avail the exemption upto the quantum specified / period specified in the Entitlement Certificate granted to the petitioners. Impugned order set aside. Mr. Venegaonkar states that Respondent will be filing another SLP challenging this order - thus any comment on that not given.

Summary

The Bombay High Court quashed and set aside the impugned circulars and order dated 11th December, 2018. The Respondent may file another SLP challenging this order.