2013 (7) TMI 26 - HC - VAT and Sales Tax

Exemption under Notification dated 31.03.1995 issued under U.P. Trade Tax Act - the said notification dated 31.3.1995 provides that the units from whom the applicant has purchased the raw material, namely, iron and steel were granted exemption for a period of 12 years, 10 years or 8 years or till the exemption entitlement gets exhausted, whichever is earlier- the claim of the applicant for granting the benefit of adjustment of 2% tax in respect of the Iron and Steel purchased from the units holding eligibility certificate was maintainable- Held that denying the benefit of adjustment of 2% tax in respect of the Iron and Steel purchased from the units holding eligibility certificate is absolutely wrong and contrary to the judgment of the Apex Court in Punjab and others etc. etc. Vs. Perfect Synthetics etc. 2008 (3) TMI 454 - SUPREME COURT OF INDIA . It is not in dispute that while dismissing the above second appeals, the Tribunal has not considered the judgment rendered by the Apex Court in Usha Martin Industries (1997 (8) TMI 77 - SUPREME COURT OF INDIA). Therefore, interest of justice would be suffice, if the matter is remitted back to the Tribunal to decide it afresh after taking into consideration the above judgments. - Matter remanded back.

Summary

Issues:
Challenge to judgment and order of Trade Tax Tribunal regarding exemption eligibility under U.P. Trade Tax Act for raw material purchases.

Analysis:
The applicant challenged the Trade Tax Tribunal's judgment dismissing their appeals related to the tax liability on purchases of raw materials for manufacturing steel bars and angles. The applicant claimed exemption under a notification granting benefits to units supplying raw materials. The Tribunal upheld the Deputy Commissioner's decision, prompting the applicant to argue that the Tribunal failed to consider relevant judgments, including one by the Supreme Court. The State contended that the tax assessment was correct as the raw materials were purchased from various sources, including those with eligibility certificates under the U.P. Trade Tax Act.

The applicant's counsel highlighted discrepancies in the Tribunal's decision, citing precedents where similar claims were upheld by higher courts. The State's representative defended the tax assessment, emphasizing the diverse sources of raw material purchases made by the applicant. The Court noted that the Tribunal overlooked the Supreme Court's ruling in a similar case and decided to remit the matter back for fresh consideration, instructing the Tribunal to review the case in light of the relevant judgments.

The Court partially allowed the revisions, setting aside the Tribunal's orders and directing a fresh consideration by the Tribunal, incorporating the Supreme Court's decision and other relevant precedents. The Court urged expeditious resolution within six months, emphasizing the avoidance of unnecessary adjournments. No costs were awarded in this matter.