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TMI Blog1995 (3) TMI 441X X X X Extracts X X X X X X X X Extracts X X X X ..... ntives to the newly established industries. The scheme has been published in G.O. Ms. No. 498, Industries and Commerce (IA) Department dated October 16, 1989. Among the incentives is included "deferment/tax-holiday on sales tax". This is available for a period of five years subject to a ceiling of rupees thirty-five lakhs during the entire holiday period of five years in so far as small-scale industries are concerned. The petitioner is a small-scale industry established with a view to avail of the benefits granted under the said G.O. Ms. No. 498. On the application of the petitioner for the benefits under the G.O. a temporary eligibility certificate was granted by the Industries Department in a sum of Rs. 1,85,000 which was valid for a peri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the conditions and that the present incumbent, having received the application for refund, verified the facts and inspected the business premises on March 16, 1994. He pointed out that one of the conditions for grant of the incentive was that the tax in respect of which exemption was granted should be utilised for development of the industry and the second condition was that the unit should be functioning. He noted that these conditions were not complied with and prayed that the writ petition be dismissed. Shri V. Ravi Kiran Rao, the learned counsel for the petitioner, contends that the fourth respondent has behaved high-handedly and recovered the tax ignoring the grant of the temporary eligibility certificate and, therefore, the tax r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llow sales tax exemption from the first month onwards after commencement of production. On receipt of an application from the industrial unit in the form at annexure XVI along with the permanent SSI registration certificate, incentive registration certificate, temporary eligibility certificate, the concerned Commercial Tax Officer will allow the sales tax exemption to the limit as mentioned in the temporary eligibility certificate and the same will be adjusted in the final eligibility certificate to be fixed by the State/District Level Committee." From a perusal of the above guideline it can be seen that after issuance of the temporary eligibility certificate the concerned industry is entitled to avail the sales tax exemption facility a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, it cannot afford a ground to the fourth respondent to deny the refund of the tax. In so far as investment of the amount for the development of the industry is concerned it is too much for the fourth respondent to expect it because the amount which could have been invested in development, had been recovered by the authority by coercive process and withheld for such a long time. In these circumstances, we find the action of the fourth respondent not merely illegal and arbitrary but also high-handed. We, therefore, consider it just and appropriate to direct the fourth respondent to refund the tax of Rs. 3,06,901 recovered on March 15, 1993 and March 29, 1993, with interest at 12 per cent per annum from the date of recovery till th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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