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TMI Blog2012 (11) TMI 606X X X X Extracts X X X X X X X X Extracts X X X X ..... so being the Board itself, and not any Department of the State Government, the other condition is also not fulfilled - against assessee. Penalty under Rule 25 - Held that:- As prior to the decision of Larger Bench of the Tribunal there are divergent views on the issue it is not a case for imposition of penalty hence deleted. - E/1490 to 1494/2012-Mum. - - - Dated:- 25-10-2012 - Mr. S.S. Kang, And Mr. Sahab Singh, JJ. Appearance Shri D.R. Gadekar, Consultant for Appellant Shri V.C, Khole, Deputy Commissioner (A.R) for respondent Per: S.S. Kang Heard both sides. 2. Common issues are involved in these applications therefore are being taken up together. 3. The applicant filed these applications for waiver of pre-d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, therefore, a State within the meaning of Article 12. However, this does not necessarily mean that every authority which is a State within the meaning of Article 12 of the Constitution of India is also a part or Department of the Government. Corporations and statutory authorities though State are different from Government even if they are controlled and financed wholly or partly by the Government. Reference may be made to the cases of S.L. Agarwal v. Hindustan Steel Ltd., 1970 (1) SCC 177, R.D. Shetty v. International Airport Authority of India, 1979 (3) SCC 489, and Ajay Hasia v. Khalid Mujib, 1981 (1) SCC 722. 6. Following the said decisions, the Allahabad High Court in U.P. State Electricity Board v. Collector of Customs Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttisgarh State Electricity Board is not a Department of the Government but took the stand that the goods i.e. PCC Poles are intended for use by the Departments of the Government, such as, Public Works Department, Water Resource Department, Public Heath Engineering Department, Education Department, Women Children Welfare Department etc. Besides, it was stated, Gram Panchayats, Nagar Panchayats, Municipalities and Municipal Corporations which are directly State deriving their authority from the Constitution of India, also use the goods manufactured by the appellant Board. Thus as the intended user of the goods is invariably one or the other Department of the State Government, they qualify for exemption under the notification. The submission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concerned Electricity Board for which the consumers pay some amount as security refundable at the stage of termination/cessation of the electric supply. The Government like any other consumer, therefore, cannot be regarded as user of the poles and it would thus follow that the subject goods are not manufactured for use by any Department of the Government. 8. As a matter of fact, on the admission of the appellant s representative that the Electricity Board is not a Department of the State Government, the benefit of exemption has to be denied, for, as seen above, the goods not only should be used by Departments of the concerned State Government, it should also be the manufactured in the factory belonging to a State Government. The status ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... win conditions, and unless both the conditions are satisfied exemption cannot be claimed. Admittedly, Chhattisgarh State Electricity Board is not a Department of the Government. Merely because 100% capital is owned by State Government does not make it a body at par with the State Government. Hence the PCC poles manufactured in the factories which admittedly belong to the Electricity Board does not qualify for exemption. That apart, the intended or actual user of the poles also being the Board itself, and not any Department of the State Government, the other condition is also not fulfilled. 11. In the result, the reference is answered in the negative and against the appellant. It is held that Chhattisgarh State Electricity Board is not a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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