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2019 (5) TMI 119 - HC - VAT and Sales Tax100% Export Oriented Small Scale Industrial Unit - refund of sales tax - benefit of Government Order dated 28.08.1993 - Karnataka Sales Tax Act, 1957 - HELD THAT - The petitioner s Unit is established in the year 1956 as such, it was existing as on the date of issuance of the Government Order. Further the petitioner-Unit has also not made any additional investment so as to attract the benefit of Government Orders under which the incentive is claimed by the petitioner. The object of the Government Order is to encourage the new entrepreneurs who are in the field of EOUs and who have made additional investments. The respondent under the impugned endorsement has clearly held that the Government Order dated 28.08.1993 is to be read along with Government Order dated 12.07.1993 as the Government Order dated 28.08.1993 is issued to implement the concessions announced under Government Order dated 12.07.1993. The learned Single Judge has rightly rejected the writ petition holding that the benefit of Government Order dated 28.08.1993 would be available only to new Industries and to the Industries which made additional investments. The Government Order dated 28.08.1993 cannot be read in isolation as contended by the learned Senior counsel for the petitioner. Appeal dismissed.
Issues:
1. Eligibility for refund of sales tax under Government Orders dated 28.08.1993 and 12.07.1993 for an Export Oriented Unit (EOU). 2. Interpretation of Government Orders regarding incentives for new and existing EOUs. 3. Dismissal of writ petition challenging the rejection of refund claim by the Single Judge. Issue 1: Eligibility for refund of sales tax under Government Orders dated 28.08.1993 and 12.07.1993 for an Export Oriented Unit (EOU): The petitioner, a 100% Export Oriented Small Scale Industrial Unit, sought refund of sales tax under Government Order No.FD 171 CSL 93 dated 28.08.1993. The petitioner claimed to have exported in excess of 50% of the value of goods manufactured, meeting the conditions stipulated in the Government Order. Despite initial rejection, subsequent legal proceedings were initiated, including a writ petition, to challenge the denial of the refund claim. The petitioner argued that both new and existing EOUs were entitled to incentives under the Government Orders, emphasizing compliance with the conditions specified. Issue 2: Interpretation of Government Orders regarding incentives for new and existing EOUs: The crux of the dispute revolved around the interpretation of Government Orders dated 28.08.1993 and 12.07.1993 concerning incentives for EOUs. The Government Order dated 28.08.1993 sanctioned refund of sales tax for a period of five years from the commencement of commercial production, applicable to Export Oriented Industrial Units meeting specific criteria. Contrary to the petitioner's claim, the Government Order dated 12.07.1993 stipulated incentives for new industrial units and existing units making additional investments. The respondent argued that the petitioner's unit, established in 1956, did not qualify as a new EOU and had not made additional investments, thus not meeting the eligibility criteria for the incentives claimed. Issue 3: Dismissal of writ petition challenging the rejection of refund claim by the Single Judge: The Single Judge dismissed the writ petition, upholding that the benefits under the Government Order dated 28.08.1993 were reserved for new EOUs and existing units making additional investments. The Judge emphasized that the Government Orders should be read in conjunction, with the Order dated 28.08.1993 implementing concessions announced under the Order dated 12.07.1993. The appellate court affirmed the Single Judge's decision, concluding that the petitioner had not demonstrated grounds to overturn the reasoned order. Consequently, the writ appeal was dismissed, maintaining the original judgment's validity and reasoning.
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